Categories: Delivery

Why Instacart, DoorDash And Other Delivery Firms Are Moving Beyond Just Food

If the holiday shopping season is divided into two groups — those who love to go shopping vs. those who don’t — the latter looks set to enjoy more opportunities than ever this year to get same-day-delivery for gifts and other purchases.

The growth of same-day-delivery services comes in many cases only a few months after the pandemic forced many traditional brick-and-mortar retailers to embrace curbside or in-store pick-up options in order to stay in business. But now, what some had seen as a temporary adaptation to COVID-19 looks set to become a long-term trend that will go well beyond food and groceries.

The latest example came Tuesday (Sept 29), a full month before the traditional start of the holiday shopping season, as Bed Bath & Beyond announced it was teaming up with Instacart and Target-owned Shipt to launching same-day delivery.

“Once the order is placed, a personal shopper from the company's Same Day Delivery partner Shipt will pick up the item at the local store and deliver to the customer's home,” a Bed Bath & Beyond statement said. Customers will pay a $4.99 fee, with a minimum order size of $39 required.

The move not only benefits Bed Bath & Beyond customers, but allows both Shipt and Instacart to further expand their stable of merchandise beyond their mainstay of groceries.

The news follows a similar partnership last week in which beauty-supply retailer Sephora announced it would soon offer same-day delivery via the Instacart platform from more than 400 of its stores in North America.

“We’re always looking for unique, yet practical ways to meet our clients at every touchpoint,” Carolyn Bojanowski, Sephora’s senior vice president and general manager of eCommerce, said in a statement. “With our Instacart partnership, we can offer a new, same-day delivery service option to our existing clients, and also introduce some of the benefits of being a Sephora client to Instacart’s marketplace.”

Chris Rogers, vice president of retail at Instacart, held up the deal as proof of a growing non-grocery business in the same-day-delivery space.

“Today, we’re excited to welcome Sephora to Instacart, delivering more selection to customers looking for a seamless, same-day shopping experience from their favorite beauty retailer,” Rogers said, adding he was proud to bring customers additional product choices from emerging and established brands.

Other delivery services are getting into segments beyond groceries and restaurant takeout as well.

In August, DoorDash expanded upon its food-delivery offerings with the launch of its “DashMart” virtual convenience stores. DoorDash said the new platform will “offer thousands of convenience, grocery, and restaurant items, from ice cream and chips, to cough medicine and dog food, to spice rubs and packaged desserts from the local restaurants.” 

And not to be outdone, Postmates announced in early September that it has become the "Official On-Demand Food Delivery Partner of the NFL."

Keeping Up With The Competition

The product diversification within the rapid-delivery sector is being driven in large part by a necessity to compete with industry giants such as Amazon, Walmart and Target — which are themselves gearing up for an unprecedented holiday-sales battle.

In response to the Amazon Prime Day sale set to run Oct. 13-14, Walmart and Target have announced similar sales events of their own. That includes Target’s “Deal Days” on the same two days as Prime Day, and Walmart’s "Big Save" online event from Oct. 11-15.

The rapid-delivery wars also intensified on Sept. 15 with the launch of Walmart+, a $12.95-a-month service whose benefits include free delivery on items from some 2,700 Walmart stores.

While Walmart+ seems on the surface aimed at Amazon Prime, it’s arguably more a hedge against Targets’ grocery business and that of traditional supermarket chains that deliver. As PYMNTS recently noted, Target and traditional supermarkets like Kroger have launched marketplaces and loyalty programs to attract COVID-19 wary consumers. Considering that Walmart's eCommerce boom during the pandemic has hinged on its grocery sales, the retailer needs to closely watch the expanding supermarket space.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.