Dive Brief:
- Kroger will offer grocery delivery via DoorDash from nearly 2,700 of the supermarket operator’s stores under an expanded relationship with the e-commerce firm, the companies said Monday.
- Shoppers will be able to place orders through DoorDash’s platform for fresh foods, household goods and other products starting on Wednesday.
- The announcement follows Kroger’s disclosure earlier this month that it believes individual stores will undergird its e-commerce fulfillment operations going forward.
Dive Insight:
Kroger’s decision to allow DoorDash to handle delivery orders across its fleet builds on a previous deal the companies announced nearly three years ago, under which DoorDash delivers sushi and floral items sourced from a subset of Kroger’s locations.
Kroger cast the expanded relationship as a way to make shopping easier while also bringing in new customers and generating incremental trips.
“Customers are looking for more convenient ways to shop at their local Kroger store, and delivery is an increasingly important way they engage with us. We want to provide customers what they want, how they want it, without asking them to compromise on value,” Kroger Chief Digital Officer Yael Cosset said in a statement.
Cosset added that Kroger’s tie-up with DoorDash reflects broader steps the company is taking to build connections with customers. Those steps include offering lower prices and more relevant offers to generate more traffic, which will in turn provide more data for its retail media business, he said.
DoorDash said Kroger is among the grocers that users of the e-commerce service search for and request the most, adding that the retailer is the largest grocer on its platform. Shoppers will be able to use DoorDash’s app to access promotions and loyalty program discounts Kroger offers.
Kroger is deepening its ties with DoorDash at the same time as the grocer examines the viability of its network of robotic fulfillment centers. Kroger has invested heavily in those facilities through a multi-year partnership with U.K.-based warehouse automation specialist Ocado, but executives have indicated that they think stores are in many cases better suited than centralized warehouses to meeting the needs of online customers — especially when speed is a priority.
Kroger, which works with Instacart and Uber in addition to DoorDash, has noticed that shoppers have shown a preference for rapid service when ordering groceries, Kroger interim CEO Ron Sargent said on Sept. 11 during the company’s second-quarter earnings call.
“We are seeing a clear trend of customers opting for faster delivery times, an area where we are well positioned based on our conveniently located store network,” Sargent said.
DoorDash has been working to expand its reach in the grocery delivery space, where it faces intense competition from rivals including Instacart and Uber Eats. In July, the company added several independent grocers to its platform, including Dorothy Lane Market, and in May linked up with Northeast Grocery, the parent company of Price Chopper, Market 32 and Tops Friendly Markets. In February, the company announced the addition of four grocery chains to its roster, including Wisconsin-based Festival Foods and Marc’s, an Ohio food retailer.
