Major grocery retailers across Canada are leveraging sophisticated data analytics to recapture market share in an increasingly fragmented shopping landscape where consumers routinely divide purchases between multiple retailers, according to loyalty program expert Lia Grimberg.
“The modern grocery shopper no longer demonstrates loyalty to a store. They’re demonstrating loyalty to a pattern,” said Grimberg, Principal at Radicle Loyalty and loyalty expert with 20+ years experience in the Canadian retail industry.
This fragmented behaviour typically sees households making monthly bulk purchases at warehouse clubs like Costco, supplemented by weekly visits to grocery banners and specialty retailers for specific categories—a pattern that has intensified competitive pressure on traditional supermarkets.
To combat this trend, leading grocers are implementing multi-dimensional customer segmentation frameworks that map consumers across four critical metrics: attrition risk, shopping frequency, average transaction value, and profit margin contribution.
“What grocers can easily determine is where they lay in the pecking order of a particular customer,” Grimberg explained. “If your customer isn’t buying staples like milk, eggs, or paper products from you, they’re currently buying these necessities somewhere else.”
During a past role, where she optimized a $150M+ loyalty budget, Grimberg implemented this segmentation approach to identify specific growth opportunities for different customer types.
“We were able to segment customers in fairly small clusters across the combination of these four dimensions,” she noted. “For instance, when you identify customers with low attrition risk, high average order value, low frequency and low profitability, you know that what you’re trying to do with this group is increase their frequency.”
For these customers, retailers develop targeted incentives to drive incremental shopping trips—such as promoting a salad bar for lunchtime visits—then test various promotional mechanics from points to percentage discounts at different reward levels to see what moves the needle.
Canada’s grocery retail landscape offers unique opportunities for this approach due to the banner structure of major chains operating across multiple price points.
“Within our Canadian ecosystem, our large supermarket grocery stores have a variety of discount versus market banners,” Grimberg said. “If they’re using their data properly, they can map to see if people are moving down market or up market within their own walls.”
The PC Optimum program provides franchise operators like No Frills with access to customer data, enabling more sophisticated inventory and merchandising decisions beyond simple transaction analysis.
“In theory and hopefully in practice, as a merchant, if you look at who buys a particular product and discover your best customers are building their entire shop around this one item, all of a sudden your delisting decision becomes completely different,” Grimberg explained.
Even retailers without traditional points-based loyalty programs leverage extensive data for strategic decisions. “Costco is a loyalty program—they have all the data,” Grimberg noted. “This is why every Costco location has different merchandise and layouts. All of their decisions are 100% data-driven.”
As economic pressures mount on Canadian households, grocers are exploring new dimensions of loyalty beyond traditional points programs. Loblaw has recently introduced gamification elements to PC Optimum, which Grimberg sees as an attempt to “offer more value because points are not cutting it when people are struggling.”
For younger consumers, traditional loyalty mechanics hold limited appeal. “For Generation Z, it’s all about experience. Loyalty programs, as far as they’re concerned, are too long-term,” Grimberg observed.
Grimberg, who holds an MBA from York University’s Schulich School of Business and completed a postgraduate degree in Artificial Intelligence at the University of Texas at Austin in 2022, emphasizes that personalization must extend beyond offers to include channel and timing considerations.
“Understanding your customers’ actual behaviour patterns rather than just their demographic profiles is critical to modern grocery strategy,” she concluded.
Dustin Fuhs is the founder and Editor-in-Chief of 6ix Retail, Toronto’s premier source for retail and hospitality industry news. As the former Editor-in-Chief of Retail Insider, Canada’s most-read retail trade publication, Dustin brings over two decades of expertise spanning retail, marketing, entertainment and hospitality sectors. His experience includes leadership roles with industry giants such as The Walt Disney Company, The Hockey Hall of Fame, Starbucks and Blockbuster.
Recognized as a RETHINK Retail Top Retail Expert in 2024 and 2025, Dustin delivers insider perspectives on Toronto’s evolving retail landscape, from emerging brands to established players reshaping the city’s commercial districts.