Grocery store increases sales with customer loyalty

It appears Kroger could be stealing customers from competitors, according to The Wall Street Journal.

It appears Kroger could be stealing customers from competitors, according to The Wall Street Journal. In spite of a down economy and rising food prices, the grocery giant has outearned analyst predictions for the fourth quarter.

The company reported sales gains of 7.7 percent, up to $21.4 billion including gas sales. Excluding gas sales, revenue growth increased 5 percent. Additionally, Kroger forecasts that same-store sales will continue to grow in FY12 from 3 percent to 3.5 percent.

Kroger's sales performance topped competitors Safeway and Supervalu. Safeway reported 1.5 percent gains for same-store sales while Supervalu saw a 2.9 percent drop in sales.

"Our customer-first strategy is delivering value for our customers, who are rewarding Kroger with their loyalty," said David Dillon, Kroger CEO. "Customer loyalty in turn is driving sales and shareholder returns."

The company's strong rewards programs have helped develop customer satisfaction and loyalty. One of Kroger's recent customer service projects includes a mobile application that targets customers using their smartphones in stores. Consumers can download an app that allows them to create shopping lists. The program then matches coupons, special offers and rewards points to merchandise on the customers' lists before they go to the stores.