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Bloomberg reports that Whole Foods, "facing intensifying competition from organic and natural-food chains, is testing a loyalty program that gives customers a 10 percent discount on its '365' private-label line of groceries."

It is a limited test - the "Hello 365" loyalty program ids only available in eight stores in Illinois, Indiana and Florida. The company says there are no plans for a rollout, but says it could happen if the program is successful.

Bloomberg notes that "Whole Foods, which has about 360 stores, is grappling with rising competition from such specialty grocers as Sprouts Farmers Market Inc. (SFM) as well as mainstream chains such as Kroger Co. that have added upscale provisions to their shelves. Meanwhile, the chain’s 'Whole Paycheck' reputation may be a turnoff at a time when many households are budgeting."

Meanwhile, Austin Culture Map reports that Whole Foods is testing a “click and collect” system that allows customers of a store in Plymouth Meeting, Pennsylvania, to order products online and then pick them up at the store. The test, according to the story, "will be expanded in early 2014 to the Whole Foods store in Laguna Niguel, Calif., near Los Angeles."

Walter Robb, co-CEO of Whole Foods, tells the site that the “'click and collect' system bridges the 'physical world' and the 'digital world' of grocery shopping.

"Based on the results of this pilot program, Whole Foods eventually could roll out the concept at its more than 320 stores throughout the United States."
KC's View:
Gosh, when Robb talks about online shopping, he almost sounds like he's just discovered it …and he's way too smart for that. So maybe he's just being disingenuous. (BTW…I'm a big fan of click-and-collect. My understanding is that among retailers that have offered it vs. a delivery program, click-and-collect gets profitable a lot faster.)

As for the loyalty program … well, I would argue that if Whole Foods only wants to use it to offer coupons on private label products, it may be missing a big opportunity. Because an effective loyalty program really analyzes shopper behavior and drills down as deeply as possible to offer relevant deals that make me as the shopper want to spend my money there rather than elsewhere. And, it makes me feel that the store is loyal to me, rather than using coupons to make me loyal to them.

Otherwise, it is just an electronic coupon scheme.