Dive Brief:

• Meijer has partnered with Instacart to offer same-day delivery service from nearly all of the grocer’s more than 240 stores, according to a press release.
• Instacart shoppers will deliver groceries and thousands of other items Meijer’s stores carry to customers across the retailer’s six-state region, which covers Indiana, Illinois, Kentucky, Michigan, Ohio and Wisconsin, in as little as one hour.
• ​Meijer’s agreement with Instacart expands on its existing third-party delivery partnerships with Shipt and DoorDash.

Dive Insight:

Meijer’s tie-up with Instacart continues the e-commerce fulfillment company’s rapid expansion across the grocery industry, further cementing its position as a must-have partner for food retailers across the United States. Instacart has grown quickly in 2020 as retailers have lined up to work with the company amid the surge in consumer interest in online shopping spurred by the pandemic.

Instacart has locked in partnerships with more than 500 retailers, giving its army of shoppers access to almost 40,000 stores. The company is reportedly looking to cash in on its popularity with customers and retailers by going public, and could receive a valuation of $30 billion when it enters the stock market, Reuters reported.

The arrangement with Meijer also could burnish Instacart’s image as a delivery service for items other than groceries given the large selection of household items and other goods Meijer carries in its cavernous stores, which can reach 200,000 square feet. Instacart has recently taken steps to expand beyond its traditional supermarket realm, bringing beauty and skincare chain Sephora on board in September and signing a deal with electronics retailer Best Buy in November.

But even as Instacart bolsters its dominant position in e-commerce, the company faces an array of competitors and often must battle with those companies on the same turf given that many retailers work with more than one online fulfillment provider.

Instacart’s arrangement with Meijer is a perfect example of that dynamic. Meijer began working with Shipt to provide delivery in September 2016, when relatively few grocery stores offered customers the ability to place orders without visiting a store, and saw the service rapidly take off.

The retailer signed on with DoorDash earlier this year as that delivery company jumped into the grocery arena. With Instacart now in the mix, Meijer customers can now choose between at least three third-party delivery services when looking to place delivery orders with the retailer.

Instacart also faces competition from Uber, which is known for its ubiquitous ride-sharing service, and has been ramping up its efforts to secure a foothold in the grocery delivery space. The company has signed deals with several U.S. food retailers, and on Dec. 1 finalized its acquisition of Postmates, which provides service to grocery shoppers in addition to serving restaurant customers.