Kroger's Game-Changer: Disney Joins the Membership Party!
In this Fast Five Short we discuss Kroger's recent partnership with Disney marks a significant shift in the retail subscription landscape, as it now offers Disney's streaming options as part of its annual membership plans. This includes complimentary subscriptions to Disney Basic with ads, Hulu with ads, or ESPN Plus for both new and existing members. The discussion explores the competitive implications of this move, particularly for major players like Amazon and Walmart, and highlights how these subscription services could lead to increased customer loyalty. The conversation also touches on the potential challenges regional grocers may face and speculates on the future of retail memberships as more companies seek to enhance their value propositions. As consumer preferences evolve, the episode emphasizes that the real winners may ultimately be the consumers, who stand to benefit from an expanding array of enticing subscription options.
Kroger has made a significant move in the retail subscription landscape by incorporating Disney's streaming services into its Boost by Kroger membership. This strategic decision allows members to choose from a complimentary subscription to Disney Basic with ads, Hulu with ads, or ESPN Plus as part of their annual fee. The $99 membership plan is designed to attract both new enrollees and existing members looking for added value in their subscriptions. Additionally, a more accessible $59 plan offers a six-month subscription to the same streaming services, appealing to a broader audience. This partnership with Disney is seen as a major win for Kroger, positioning it as a formidable competitor against giants like Amazon and Walmart, which already offer similar subscription models that include access to extensive content libraries. This move signals a shift in consumer preferences towards bundled services that integrate both retail and entertainment, raising questions about how regional grocers will keep pace with these developments.
The implications of such partnerships extend beyond mere consumer offerings; they hint at a future where grocery retailers leverage media content to enhance customer loyalty. As subscription models become more popular, the potential for customer retention increases, making it harder for consumers to switch to competing brands. The conversation also touches on the future of retail subscriptions, with both speakers contemplating what other services could be integrated into these models. The discussion raises interesting points about the direction of services like Walmart Plus and the ongoing evolution of consumer expectations, particularly among younger demographics like Gen Z and Gen Alpha. These groups prioritize experiences and value, suggesting a future where grocery shopping could incorporate elements of hospitality and lifestyle services, further blurring the lines between retail and entertainment.
Additionally, the episode delves into the competitive landscape of retail subscriptions, highlighting how companies like Target may need to rethink their strategies to remain relevant. As Kroger enhances its offerings with Disney's vast content portfolio, the pressure mounts on other retailers to find unique partnerships or services that can differentiate them in a crowded market. The speakers express curiosity about how Target will respond and what additional streaming or media content they could potentially offer. This episode underscores the significance of innovation in the subscription space, as retailers vie for consumer attention and loyalty in an increasingly digital world.
Companies mentioned in this episode:
- Kroger
- Disney
- Hulu
- ESPN
- Amazon
- Walmart
- Paramount
- Netflix
- Albertsons
- PBS
This podcast uses the following third-party services for analysis:
Podcorn - https://podcorn.com/privacy
Transcript
Kroger has revealed that boost by Kroger will now include Disney's streaming options as part of its annual membership subscriptions.
Speaker A:According to Progressive Grocer, for its $99 a year plan, new enrollees and existing members may select a complimentary subscription to Disney Basic with ads, Hulu with ads, or ESPN plus for the duration of their $99 annual membership.
Speaker A:For its dollar 59 plan, new enrollees and existing members may select a complimentary, one time, six month subscription to Disney Basic with ads, Hulu with ads, or ESPN Plus.
Speaker A:Chris Kroger landed Disney.
Speaker A:It's big news.
Speaker B:Yeah.
Speaker A:So what do you think this means for the retail subscription landscape?
Speaker B:Oh, wow.
Speaker B:I mean, if you're scoring at home, and let's score this at home.
Speaker B:Yes, you've got Amazon with Amazon prime.
Speaker B:Pretty formidable, right?
Speaker B:Kroger and possibly albertsons down the road, who knows?
Speaker B:Disney plus.
Speaker B:Yep, also pretty formidable.
Speaker B:Walmart, Paramount plus, not as compelling, but okay.
Speaker B:I mean, especially if you like Yellowstone, wherever the hell that show is going.
Speaker B:And so the regional grocers, if you think about it, are going to have a tough time competing because people are going to become more sticky to Amazon, Kroger and Walmart for e commerce, grocery by way of these subscription programs and how enticing they are.
Speaker B:And once you get people into them, it's hard to switch.
Speaker B:Right.
Speaker B:And so the other part of this that makes me wonder who loses out nationally is target too.
Speaker B:Like who's target bringing into the party at this time?
Speaker B:I mean, is PBS available?
Speaker B:Like, like what other.
Speaker A:They have a great menopause documentary coming out this weekend or next weekend.
Speaker A:You never know.
Speaker A:Services out there, they're not dead yet.
Speaker B:Yeah, maybe Netflix.
Speaker B:Maybe.
Speaker B:Maybe Netflix gets into this party at some point, which would be kind of game changing if you could convince them to come in.
Speaker B:But, you know, I think grabbing Disney was a great coup for Kroger, and people are gonna rue the day, I think, that they were able to get that potentially, given all the content Disney has under its umbrella.
Speaker B:So I think this is big news, and it just shows you that the subscription battles are heating up.
Speaker B:They're going to get more and more varied and more and more differentiating and more and more enticing.
Speaker A:Yeah, I mean, I think the consumer wins.
Speaker A:Yeah, agreed.
Speaker A:We interviewed Vanessa Yates.
Speaker A:She's the SVP of Walmart plus a couple days ago.
Speaker A:And one of the things that I thought was most interesting about that conversation is when we talked about the future of the Walmart plus membership.
Speaker A:One, how do you keep that price point at $98 and not increase it yearly like we're seeing from Amazon and some of the others.
Speaker A:And how do you get more products or more value for your consumers under that same umbrella?
Speaker A:And one of the things that she talked about that I think will be really interesting, especially as more Gen Zers and Gen Alpha come into the subscription market.
Speaker A:What else do they add to that?
Speaker A:And when does hospitality start to come?
Speaker A:And airlines like, you know, we know that that generation prioritizes experiences, so how do they bring more of that into this experience?
Speaker A:Even healthcare and other things, too.
Speaker A:So that's something that we'll be watching really closely and on one side of it, and then I think the other part is Christy Argyll on Albertsons media collective we talked to yesterday, too.
Speaker A:And you think about the retail media side of it and the data sharing that's happening between these companies now, when you're connecting these programs and you have visibility not only to what the retail or what the customers are doing in a kroger, but what their behaviors are on Disney, on ESPN, on Hulu, and then what their, you know, down the road, what their extensions might be, where they like to vacation, what, you know, they.
Speaker A:What spending they do on their credit cards, and help kind of further inform the full package of what that membership can offer them.
Speaker B:Yep, 100% agree.
