An analysis of millions of grocery transactions and surveys of thousands of shoppers reveal a major challenge for grocers: more than 90% of grocery shoppers are uncommitted, prioritizing their own needs over brand loyalty. As this behavior grows in popularity, it’s no longer enough to win a shopper once and expect return visits.

Upside’s latest report, Winning the Uncommitted Customer, shows that retailers must engage customers early in the relationship to win them back for each subsequent return trip — forming habits and building long-term loyalty.

Strengthening loyalty through early engagement

Most grocers have a loyalty program at the center of their retention efforts — and they work to an extent. Our data shows that when customers use a loyalty program, the month-one churn rate drops from 31% to 14%. That’s a total of 17 percentage points and a meaningful improvement. 

But even with a loyalty program, one or two out of every 10 shoppers still won’t return after the first month. And it’s not necessarily for a lack of resources on the grocer’s part. When we surveyed retailers, nearly 40% of them said their customer acquisition costs have risen year-over-year, and more than a third of them have increased their marketing budgets to keep pace. 

This retention gap signals an opportunity. Loyalty isn’t broken, it’s just not enough on its own to drive sustained behavior.

Especially in an inflationary, promotion-saturated market, shoppers prioritize convenience, relevance, and digital value. To keep pace, grocers need to strengthen their loyalty strategies by engaging customers earlier — before the second visit, when habits begin to form.

Who is the uncommitted customer?

Uncommitted customers put their own value ahead of loyalty to any particular retailer or brand. They shop across banners and formats in order to provide for their households most effectively. They span all demographics and loyalty statuses. From the retailer’s perspective, you might see them making regular small purchases or infrequent large ones without forming a habit to dedicate the majority of their spend to you.

The three defining characteristics of an uncommitted customer are:

• Value-seeking: Uncommitted customers are price-sensitive, cross-shopping at up to three locations per month to best meet their needs. But price isn’t the only consideration for them — factors like item quality and convenience can also impact value equations for shoppers. 

• Digitally driven: Uncommitted customers have everything they need right at their fingertips. About 90% of these shoppers say they use online sources to discover brands; in grocery, that means they’re comparing prices and seeking value.

• Opportunistic: Uncommitted customers make decisions about where to shop while on the go. In fact, roughly half of surveyed customers said they decide where to shop less than two hours before going.

Again, although uncommitted customers might not be behaving loyally, they often join loyalty programs. When they do, churn is high early in the customer relationship — and when acquisition dollars are being spent to win these customers, their early exit creates a ripple effect that drags down ROI.

Building habits, not just giving discounts

Uncommitted customers might be hard to win, but it is possible to get their business. The key moment to engage them isn’t months into the relationship — it’s before the second transaction. That’s when behavioral patterns start to form and when the right intervention can tip the scale toward loyalty.

Loyalty programs still play an important role. But the most successful grocers aren’t relying on it alone; they’re enhancing it with digital programs that address real consumer behaviors. Combining loyalty with other strategies creates compounding value that drives repeat visits.

In our new report, which analyzed 2.7 million grocery customers shopping at over 300 American stores, Upside found that layering multiple incentive strategies had the greatest impact on retention. 

The chart below highlights the importance of incentivizing shopping behavior. Shoppers with no loyalty or cash back rewards showed the lowest retention growth. Loyalty programs alone were more successful, but the most powerful impact comes from combining multiple incentives: loyalty and cash back rewards. 

Layering these incentives provides the value that shoppers are actively seeking elsewhere, encouraging them to return to your store instead of shopping around for better deals.

Rethinking loyalty for 2025 and beyond

To truly improve retention, retailers need to strengthen their loyalty efforts. Marketplaces that offer personalized cash back incentives can complement loyalty programs, encouraging long-term customer engagement without cutting into profits.

Improving customer retention and earning true loyalty isn’t just about offering discounts. It’s about understanding what each customer needs in the moment and showing up with the right offer, in the right place, at the right time.

By layering proven strategies, like traditional loyalty and personalized incentives, retailers can turn fleeting visits into frequent ones for sustainable growth.