by Cody Hodge

Created on: October 01, 2009

Have you ever been shopping at the grocery store, and you have noticed that a lot of items are discounted, but only if you have the discount card? What is the point of that? Wouldn't it just be easier to discount all the items without the use of a card, and make it so you didn't lose out on savings if you forgot your card? Wouldn't it be easier for the employees to not need to have a card on hand in case the customer forgets the card? If only it were that simple, there are many reasons why a grocery store uses a discount card besides discounts.

Obviously the main reason that a grocery store uses the discount card is for discounts, but why do they discount the items that they do? There are strategic reasons why sometimes the peanut butter is going to be on sale, and sometimes the peanut butter is simply going to be set at a lower price. It is to drive traffic, but there is another reason why the grocery store is going to use a discount card for certain items as opposed to just setting the prices lower.

The main reason for doing this is because with the card they can track who is buying what. They can see who is buying the peanut butter, and what brands are being purchased. If you wanted to see how many people are buying the Jif peanut butter as opposed to the store brand, you can put it on sale via the discount card, and you are going to see how many people are buying one brand versus the other brand.

The next reason they will do so is to notify customers of product updates, recalls, or information. Again with the peanut butter, when there was the huge scare a few months back, grocers were able to call customers who had a discount card on file. They were able to look up the customer information, and actually call them, or send them an e-mail saying that a certain brand was on recall, and that they could bring back the tainted products.

Another reason to use the discount cards to collect customer information is that you can reward your best customers. Where I work, there is a gift bag for the top 50 customers at the end of every year. They cull the information that is taken from the discount card, and they are able to formulate a list of the customers who have spent the most amount of money. Another good reason to get a discount card wherever you do your shopping.

You might think it is weird that they would give you a card for discounts, especially when the stores can just set the prices at whatever they want. When you really think about it though, it makes a lot of sense for the stores to not only give customers discounts, but have a way to keep track of customer behavior. It is a win-win for both sides, and takes advantage of technology to improve business practices.

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