Gas. Food. Savings.
With prices soaring, grocery chains compete for customer loyalty by offering incentives that ease costs at both the pump and the checkout counter
With the economy struggling and gas and food prices escalating, grocery stores are aggressively competing for price-conscious shoppers.
Several chains are offering a discount at the pump when customers buy groceries. Some stores also are trying to lure shoppers with deep price cuts on everything from ice cream to coffee.
And it's becoming increasingly common to see coupons offered only on store websites and discounts you can only find in a grocery flier in the newspaper or by mail.
These are the latest tactics grocery stores are using to compete for customer loyalty at a time when shoppers now are paying near record prices for food and fuel.
Gas prices are near all-time highs and food prices have skyrocketed 5.3 percent from a year ago, the fastest increase since 1990.
John Rand, a grocery store analyst with Cambridge-based Management Ventures Inc., said New England has lagged behind other parts of the nation in gas discounting programs.
He also noted that many grocery store chains are moving toward a pricing model that shuns big-sale discounts in favor of lower everyday prices.
The message the stores are trying to send to consumers, Rand said, is that they can count on their overall shopping trip being less expensive than it had been.
"It's a good message to be putting out in this economic time," he said. The Boston area is "not a low-price market, but it is a more competitive market now."
As a result, some chains, such as Shaw's, Stop & Shop, and Price Chopper, are trying to entice customers by offering discounts at gas stations based on how much a shopper purchases at the grocery store.
The discounts can add up, typically accumulating at 10 cents a gallon for every $50 spent.
Shaw's, which started its program offering discounts on fuel purchased at Irving Oil stations in New Hampshire, has since expanded to Massachusetts stores in Worcester County and in suburbs north and south of Boston.
Stop & Shop, with some 70 stores with their own gas stations in New England, is offering discounts on its own brand of gas. And smaller Price Chopper, which has several Central Massachusetts locations, is partnered with Sunoco.
"Food and fuel go hand in hand," Shaw's spokeswoman Judy Chong said. "They have to buy food and they have to buy gas. If they can save doing both, they're compelled by it."
Shopper Kim Schoen of Worcester agrees. The mother of four said she found her grocery bill is always bigger at Shaw's and Stop & Shop, so she became a regular at Price Chopper.
Then she got hooked. She said that after several trips for groceries, she recently took her minivan with an empty tank and filled it after getting a $2.20 a gallon discount.
"I didn't go there because of the gas," she said. "The gas just became a factor to make me stay." But the gas discount isn't the only way stores are trying to convince customers that it's better to come inside their stores.
Stop & Shop said it has or will cut prices on items in 70 percent of the categories in its stores - moving away from a pricing model that favored higher prices and the enticement of big markdowns for sales.
In May, Stop & Shop dropped prices on 40 types of ice cream cones and toppings.
Other price cuts include frozen food, cereal, and coffee, the company said. And the company is extending some of its seasonal price cuts.
For example, the chain is putting Gatorade products on sale for the entire summer - compared with the more traditional week-long sale.
In the already competitive world of grocery stores, creating a feeling that you're offering a better deal than your rival is huge, said Jim Dwyer, chief business development officer for Ahold USA, which owns Stop & Shop.
"That's become even more important as the economy has softened a little bit," he said. "There's no question that's in response to the way things have been going."
Another change showing up at some Stop & Shop stores is a handheld price scanner that shoppers can pick up at the front of the store.
They can use the scanner to check prices, scan an item from the shelf into a grocery bag, and, with a running tally, pay based on what they've scanned - avoiding checkout lines.
Over the last few months, Dwyer said the scanners have been slowly rolled out across the chain and are now available at 92 of the 350 or so Stop & Shop stores.
About 60 scanners are typically available at each store. Dwyer said consumers have quickly embraced the program, particularly the heaviest shoppers.
In addition to helping shoppers stay within their grocery budget, Dwyer said the scanners are "a very fast way to get through a store."
Hannaford, which has been promoting itself as a low-price supermarket, took a tack similar to Stop & Shop, dropping prices on 1,500 items following the "everyday low price" model made famous by Wal-Mart.
Spokesman Michael Norton said the company avoids gimmicks (although it did give away a car in the spring in a promotion) and doesn't even offer a discount card - something that is common to most chains.
He noted that incentives being offered by other merchants to customers who used their economic stimulus checks for groceries was an example of something Hannaford would not do.
Hannaford, Norton said, has tried to show shoppers its prices are competitive.
For instance, it has a $10 meal promotion that offers recipes for four that always come in under that magic number, including shrimp scampi, or grilled pork sirloin with vegetables.
"They want a good value and they want to get in and out quickly," he said. "Nobody knows how long this environment is going to persist," Norton said.
Even so, not every grocery shopper is swayed by store pricing and marketing gimmicks.
Lorena Dias of Arlington has another reason for shopping at her local Stop & Shop. "It's convenient," she said. 