Albertsons Says New AI and Interactive Features Boost Digital Sales

Albertsons Companies saw growing engagement with its digital platforms during the last quarter.

The food and drug retailer’s digital sales increased 25% during the quarter ended June 14, outpacing its 2.8% increase in identical sales, Albertsons said in a Tuesday (June 15) earnings release. It also saw a 14% increase in its loyalty program membership.

“Ongoing investments in our strategic priorities drove increased engagement across our digital platforms, evidenced by strong growth in our digital sales, pharmacy operations and membership in our loyalty program,” Albertsons CEO Susan Morris said in the release.

Morris said Tuesday during the company’s quarterly earnings call that the growth in digital sales boosted eCommerce’s share of total grocery revenue during the quarter to 9%. She attributed the growth to Albertsons’ customer service and mobile app.

Recent enhancements to the company’s digital experience include the introduction of artificial intelligence and interactive features, including one that allows customers to communicate back-and-forth with its in-store employees during the order fulfillment process and another that lets customers add items to their orders after placing them, until picking has started, “recognizing that shoppers often think of one more item they need just after an order is placed.”

“While our eCommerce penetration is still below industry peers, it is one of our biggest growth, customer acquisition and customer retention opportunities for 2025 and beyond,” Morris said during the call. “From a profitability perspective, our eCommerce business is near breakeven and improving.”

The company said in the earnings release that the growth in digital sales leads to increases in delivery and handling costs, which contributed to a decrease in gross margin rate during the quarter.

Albertsons’ loyalty program grew to include 47 million members after gaining 14% in the quarter, Morris said during the call. She added that the company had simplified the program and further enhanced the value it offers.

“Members in the program today are engaging more frequently, using more of our easy-to-understand-and-redeem features and spending more with us,” Morris said.

It was reported in January that Albertsons was investing heavily in digital transformation and that its digital connections were driving customer growth.