Retailers and restaurants offer offers to shoppers

A car pumps gas at the Costco gas station. Gas prices in the United States have risen over the past two weeks due to the conflict between Ukraine and Russia.

Michael Ho Wai | Lightrocket | Getty Images

Along with fried chicken, biscuits and iced tea, family meals at the Southern fast food chain Bojangles now have a $ 10 case card free.

At select Crispy cream shops, the price of a dozen polished donuts dropped temporarily on Wednesdays, with drivers paying more per gallon, reducing breaks.

As Americans feel the pain at the pump and some begin to choose to withdraw from the budget, companies are hanging on to gas-related concessions. Warehouse clubs, including Walmart-owned Sams Club and BJP Wholesale Wholesale, have made special advertisements to emphasize cheap gas for the benefit of a key member. Grocers, including Groger and Giant Eagle, are talking about fuel plans that reduce customer grocery costs to less than a gallon.

“We are an automobile economy,” said Jackie Woodward, Bojangles’ chief brand and marketing officer. “It’s really something that touches the heart of how people go about their lives, which is why I think it resonates with our customers.”

Bojangles last week began offering $ 1 million worth of gas gift cards to restaurants and owners owned by the company, many of which have been hit hard by inflation, especially in the southern states.

The customer at the Charlotte-based company is usually a blue-collar worker who “cares about the food they feed their families and how they extend their dollars,” Woodward said. He said the fast food chain took advantage of the opportunity to show that it was in line with customers’ concerns. So far, customers have responded with surprise and gratitude for getting more of their money, he said.

As inflation rises to a nearly 40-year high, gas prices are one of the daily expenses. The gallon national average reached $ 4,331 on March 11, the highest price ever recorded by the AAA. It averaged $ 4,098 as of Tuesday, but it’s up significantly from the $ 2,863 a year ago. In some northeastern and western coastal states, gas prices are even higher. For example, in California, the average gas price on Tuesday was $ 5.748 per gallon, according to the AAA.

Prices published in large labels across the country pay only a fraction of the cost of housing, but could have a greater impact on consumer confidence, said Tendai Cupidge, chief economist at US Bank.

“The attitude effect can be bigger than the wallet,” he said.

Impact on retail

Cuffitse said consumers spend about 4% to 6% of their monthly expenses on gas. This is a heavy burden on low-income families, where the percentage can rise as high as 20%.

On Thursday morning, when the Department of Commerce reports retail sales from March, retailers will receive new clues as to how consumers will respond to those prices. Retail sales in February were ashamed of expectations, indicating that the pace of consumer spending could slow.

However, even before the March retail information was released, concerns about consumer status were growing. Over the past two weeks, an uncertain economic background has prompted analysts to reduce the shares of some retailers and upgrade others. The war in Ukraine has added to the uncertainty about consumer sentiment. Some economists have warned of the risk of recession, even though unemployment is low and jobs are more than enough to fill them.

Companies like Macy’s have agreed to compete for the preferred dollars as some consumers decide between buying new clothes, booking a vacation or going to dinner.

Petrol prices will be displayed at a petrol station in Manhattan, New York on March 7, 2022.

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Steve Sadove, former Saks CEO and senior adviser at Mastercard, said retailers are at an infiltration point when consumers have less space to spend their money after an “almost naked period.”

During the earlier part of the epidemic, people put in trigger checks and extra savings to buy. Companies received less advertising and more profit because inventory was lower than usual. Holiday sales, for example, hit an all-time high of $ 886.7 billion, despite the supply chain snorls and the Omigron-fueled spike case.

Satov said consumers are healthy, but he expects costs to fall. Higher retail numbers now reflect higher prices for gas and other commodities, not just shoppers’ interest in spending, he added.

Sending message

Although the high cost of the pump is a burden to consumers, some retailers see the opportunity to capture a large share of household budgets.

Beginning last week, cashiers at Giant Eagle grocery stores began promoting the company’s loyalty program at Checkout. The private grocery store has 200 supermarkets and 270 convenience stores with gas stations in Pennsylvania, Ohio, Indiana, Maryland and West Virginia.

One of the key features of the program is the rewards that customers can redeem for dollars from groceries or gas. To motivate customers to sign up, Justin Weinstein, vice president of customer experience, said the grocery store offers a 10 cent discount for the first 90 days on every gallon of gas it buys from its pumps. It also recently waived the expiration date of the rewards, he said.

“Fuel prices were on our minds when we made this change,” he said.

Weinstein said the Giant Eagle had noticed that gas prices had already changed buying patterns. Customers are turning to smaller, more frequent fillers.

Some companies have a little fun with the otherwise serious stuff. Starting this week, Krispy said Kreme is tapping into its “strategic donut balance”. Over the next four weeks, it will set the price of a dozen of its polished donuts on Wednesdays, in line with the national average for a gallon of gas. It’s less than half its regular price above $ 10.

Dave Skena, chief marketing officer, said the idea was born out of complaints from his own groups about gas prices. The lighter idea, he says, gets the more real problem for home budgets. Gas prices are unique because billboard size numbers are on the face of consumers, he said.

“It’s very conscious, and it’s not very changeable, and for many, it has a significant impact on other things they can buy – especially things that are fun,” Skena said.

Donuts are sold at the Krispy Kreme store in Chicago, Illinois on May 05, 2021. Donut Chain said yesterday it plans to take the company back to the public.

Scott Olson | Getty Images

For membership-based warehouse clubs, branded gas stations – and their low prices – are the way to attract customers.

According to Kate McClellan, CEO of the Samsung Club, some members register at the pump at a cheaper price. Once they are full, the club is looking for ways to pull them in, he said.

“We see gas as a member advantage – so we always want to be very competitive – and then it becomes the transport driver for the club,” he said.

This month, the Sams Club offers 10% store credit every Tuesday.

Warehouse Club competitor BJS encourages shoppers to fill refrigerators and tanks at the same time. Customers who spend $ 100 or more at a club this month will receive a 50 cent discount per gallon on the same day of the transaction. If they shop with one of BJ’s co-branded credit cards, they will get an additional 10 cents discount during a month’s ad.

Costco, another warehouse club, saw sales increase in March as gas prices rose. In the five weeks ending April 3, its comparable sales increased by 17.2% compared to the same period last year.

Some of those sales gains came from customers who shopped in stores after being inspired by gas prices and the warehouse club’s gas pumps.

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