Kroger Co. has made yet another move to gain an edge in the competitive online grocery market.
On Wednesday, the nation’s largest supermarket 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, Kroger reported.
The program enables customers to shop from a curated selection of 4,500 Kroger private-label products, which are not available anywhere else online, and more than 50,000 center-aisle groceries and household essentials. The service also features bulk and additional sized merchandise. Assortments were curated based on insights revealed through Kroger’s 84.51° customer insights division.
The program also offers a “set-and-save” subscription model that enables customers to create a list and set up automatic deliveries. The service entitles users to a 5% discount on orders, according to Kroger’s website.
Shipping is free on orders over $35, or $4.99 for smaller orders. During the launch phase, customers will receive free shipping, with no minimum purchase required, and 15% off their order with a one-time-use promo code.
"Kroger's e-commerce platform expands our offering beyond the physical store to include even more products,” said Yael Cosset, Kroger's chief digital officer. "Kroger Ship is our next step in creating a seamless experience that allows our customers to shop when and how they want.”
Kroger Ship complements the retailer’s 1,250 curbside pickup locations, and delivery service from 1,200 locations.
This is Kroger’s latest move to accelerate the company’s commitment to digital and e-commerce efforts, and compete with rivals, such as Amazon, Walmart and Target. Last month for example, the supermarket operator announced it would deliver online grocery orders using a fleet of self-driving vehicles.
To further evolve its digital business, in May, the company 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.
"Our vision is to build a seamless e-commerce system that offers our customers an ever-growing number of products, and allows Kroger to ship nationwide,” said Frank Bruni, VP of supply chain and procurement.