Payment Options

osk. Giant Eagle, Albertsons Cos., Lowes Foods, Meijer, Hy-Vee, ShopRite and many other grocers offer similar options.

San Francisco-based Instacart, meanwhile, is creating a contactless payment ecosystem through its Connected Stores solutions. Independent grocer Foodcellar Market was the first retailer to fully roll out Instacart’s Scan & Pay option, which lets shoppers scan a QR code found on a sign at the front of the store and automatically add items to their digital cart and check out anywhere via their smartphone.

“Our customers have shared their surprise at how easy it is to use Scan & Pay – there’s no need to download an app or learn complicated technology,” says Metin Mangut, co-founder of Long Island City, N.Y.-based Foodcellar Market. “We’ve been really pleased with the early adoption, and our store associates love how Scan & Pay reduces stress for them, too.”

Amid inflationary times, many grocery shoppers are also turning to buy-now-pay-later (BNPL) options in an effort to stretch their dollars at the register. A PYMNTS.com study found that 40% of Millennial and 37% of bridge Millennial grocery shoppers are “very” or “extremely” interested in such a service.

Stockholm-based financial technology company Klarna partners with Walmart to give customers the option of splitting the cost of their purchase into four separate interest-free payments, with other companies, including Four, Zip, Affirm and Splitit, offering similar services at food retail.

Another payment option seeing mass adoption is online acceptance of electronic benefits transfer and Supplemental Nutrition Assistance Program (EBT SNAP) payments. Millions of shoppers throughout the United States depend on SNAP benefits, making this an important component of e-commerce operations across the grocery industry.

A Host of Considerations

Customers are becoming increasingly interested in these options, as well as everything from self-serve kiosks and endless aisles to smart shopping carts and in-app payments, giving grocers a lot to consider in terms of the flexibility they offer at checkout. Wegmans Food Markets, for example, rolled out its Scan app in 2019 and ramped it up during the height of the pandemic, but discontinued the service last year in the wake of shoplifting losses.

“Early in the pandemic, we quickly rolled out our Scan app to provide a contactless in-store shopping option,” Rochester, N.Y.based Wegmans noted at the time. “Scan users have told us they love the app and the convenience it offers. Unfortunately, the losses we are experiencing prevent us from continuing to make it available in its current state.”

Other grocers have lamented similar issues, but technology advancements are helping to ensure that these problems are addressed head-on. Instacart’s contactless payment solution, for instance, promises speed, convenience and added budget consciousness for customers, but it also lets retailers employ a dashboard aimed at monitoring Scan & Pay transactions in real time to monitor loss prevention and stay on top of any pattern shifts.

Customer data safety is another issue to keep in mind when considering new payment options. Third-party companies like Miami-based payment systems provider ACI Worldwide offer merchant omni-tokens that protect data across all in-store and online payment channels, as well as point-to-point encryption that protects customer data throughout the payment process.

The New Era

At the end of the day, new payment options will only continue to proliferate and shoppers will remain loyal to those grocers that offer convenience, speed and a positive experience. According to ACI’s “Who’s Shopping at Your Store?” report, “Grocers have a massive opportunity to migrate to new types of digital and hybrid services that resonate with — and lock in — increasingly connected consumer audiences.

“Grocers must respond by continuing to evolve with their customers while accelerating innovation and finding new ways to harness payment tech to best service their changing needs,” the report continues.

Indeed, ACI notes that enabling these payment methods, as well as others, gives grocers an unmatched opportunity to remove friction, minimize fraud and false declines, seamlessly connect services, personalize loyalty and experiences, and much more.

Foodcellar Market is partnering with Instacart to offer the latter company's Scan & Pay option, which lets shoppers scan a QR code and automatically add items to their digital cart and check out anywhere via their smartphone.