Kroger begins an unconventional delivery service—no driver required

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Kroger begins an unconventional delivery service—no driver required

By Deena M. Amato-McCoy - 08/16/2018
Kroger Co. has gone driverless in Scottsdale.

On Thursday, the supermarket giant formally launched its self-driving grocery delivery pilot at a Fry’s Food location in Scottsdale, Arizona. The launch comes several weeks after Kroger announced its partnership with tech startup Nuro, the maker of a fully unmanned vehicle.

Initially, deliveries will be made by Nuro’s self-driving Toyota Prius fleet. But sometime later this fall, the deliveries will be made by Nuro’s custom R1 driverless vehicle (shown in the photo above). The self-driving vehicle, which has been called a “delivery pod,” is about half the size of a Toyota Corolla, and is specifically designed for the local transportation of goods.

"We're excited to launch our autonomous vehicle delivery pilot with Fry's in Scottsdale," said Kroger chief digital officer Yael Cosset. "Kroger wants to bring more customers the convenience of affordable grocery delivery, and our pilot with Nuro will help us test and learn to understand customer acceptance of autonomous vehicles in our seamless offering.”

Here’s how it works: Customers place delivery orders online or through Fry's mobile app, and then choose a delivery time based on slot availability. Grocery orders can be scheduled for same-day or next-day delivery. Orders will arrive via the car, and be left at the customer’s curb. There is a flat fee of $5.95, and no minimum order is required to use the service.

This is only one of Kroger’s plans to bolster its digital offering, and compete with rivals, such as Amazon, Walmart and Target. Earlier this month for example, the company launched Kroger Ship, a service that delivers goods through third-party carriers. The service will initially be available in Cincinnati, Houston, Louisville, and Nashville. More markets will be added over the next few months.

In May, Kroger announced an exclusive partnership with British online grocer market Ocado, and acquired online meal-kit company Home Chef. Early efforts are making an impact, as the chain reported its first quarter digital sales grew by 66%.

To better focus on these initiatives, the grocer also established a separate headquarters for its digital team in downtown Cincinnati. It will house approximately 600 existing Kroger digital associates at first, who are being relocated from another facility. The retailer said it expects to grow its digital team to more than 1,000 over the next three years.

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