Grocery Roundup: Walmart Takes on Instacart With New Tech Partnership

Walmart’s white-label delivery service is turning its focus toward small- to medium-sized grocery retailers.

The retail giant announced in a Wednesday (Feb. 23) press release a partnership with Cognetry Labs, an artificial intelligence (AI)-powered, end-to-end eCommerce software provider for grocers, to create a turnkey solution for mid-sized and independent grocers to run digital delivery businesses, including access to Walmart’s delivery network.

“This is one way we deliver on Walmart GoLocal’s brand promise to bring affordable access to products and services to customers while also empowering businesses to grow using our capabilities and coverage,” said Walmart GoLocal General Manager Harsit Patel in the release. “The fully integrated solution with Cognetry Labs plus Walmart GoLocal drives value to our customers and addresses real needs of mid-market retailers.”

In the past couple of years, many smaller grocers looking to offer a competitive online business have had to rely on Instacart to provide consumers delivery options. With this feature, Walmart offers a white-label alternative for grocers to fulfill eCommerce orders while holding onto their customers rather than losing their loyalty to third-party marketplaces.

Offering the option to bring groceries to consumers’ doors can go a long way toward driving purchasing frequency for grocers, according to data from PYMNTS’ study “Decoding Customer Affinity: The Customer Loyalty to Merchants Survey 2022,” created in collaboration with Toshiba Global Commerce Solutions. The report, which drew from the results of a survey of a census-balanced panel of more than 2,000 U.S. consumers, also noted that 20% of consumers said delivery options would improve their loyalty to their grocer.

Get the report: The Customer Loyalty to Merchants Survey 2022

Kroger Launches Reusable Container Program to Keep Shoppers Coming Back

Kroger’s latest environmental, social and governance (ESG) initiative aims to build loyalty in more ways than one.

The grocery giant announced in a Wednesday press release that its Portland, Oregon-based Fred Meyer brand is partnering with Trenton, New Jersey-based recycling company TerraCycle to bring the latter’s Loop platform into stores.

Through the program, consumers can purchase items in reusable packaging, returning empty containers to designated bins, where they will be cleaned and refilled. Once these containers are returned, consumers receive back a deposit paid upon initial purchase. The program, available at 25 Fred Meyer locations in the Portland metropolitan area, includes 20 food and household products from national and private-label brands.

The initiative not only builds loyalty by appealing to ESG-conscious consumers’ values but also incentivizes consumers to keep coming back to stores. After all, once they return the package to receive their deposit, they will likely shop for new items, since they are already at the store. These new items may also come in Loop reusable containers, perpetuating the cycle for future grocery shopping trips.

“Customers are increasingly seeking out sustainable products and services that fit their lifestyle, and this collection makes it convenient,” Kroger Head of Sustainability Lisa Zwack said in the release. “As the first grocer in America to offer these products, Kroger is pleased to take another meaningful step toward a world with zero waste.”

Kroger and Kitchen United Expand Grocerant Partnership to Houston

Also in Kroger news, the grocery brand announced Monday (Feb. 21) in a press release the opening of its second location in partnership with virtual restaurant company Kitchen United’s multi-brand, off-premise restaurant program Kitchen United MIX.

Following the opening of the first such location at a Ralphs store in Los Angeles, California’s Westwood neighborhood, the two companies opened a pickup and delivery restaurant at a Kroger brand grocery store in Houston, Texas.

Read more: Seeing the Writing on the Wall, Major Grocers Enter the Restaurant Space

The partnership allows Kitchen United to reach new customers in the course of their grocery shopping trip and enables Kroger to embed itself in consumers’ prepared meal ordering routines, seizing on consumers’ growing expectations of on-demand convenience.

“Our customers know they can count on Kroger as a destination for the freshest meal solutions,” said Kroger Group Vice President of Fresh Merchandising Dan De La Rosa in the release. “The Kitchen United collaboration provides another simple, on-demand meal option within our stores. It is one more example of how Kroger is fulfilling our commitment to anything, anywhere, anytime.”

Ultrafast Grocery Options Expand Inland With Food Rocket’s Chicago Launch

As ultrafast grocers struggle with soaring losses and potential upcoming regulations that could threaten their value proposition, consumer desire for on-demand remains high.

While much of the innovation in the space in the U.S. has been centered on New York City, ultrafast grocers are beginning to expand into other areas. Food Rocket, a 10-minute to 15-minute grocery delivery startup, for instance, announced in a Tuesday (Feb. 22) press release its expansion to Chicago. The city marks the delivery service’s second market, following its launch in San Francisco last year.

“Even though Chicago is an extremely competitive market, we plan on moving the entire team there,” said Food Rocket CEO and Founder Vitaly Alexandrov in the release. “The software and AI we use not only allow us to reduce delivery times, but also to more precisely select an assortment for each consumer. Of course, we also rely on local producers, whose products will be available to Chicagoans within 10-15 minutes of placing an order.”

In late December, ultrafast grocer Buyk announced its own Chicago launch.

“We think that there’s an opportunity to treat these markets and subsequent markets throughout the U.S. differently, that through our focus on a hyperlocal assortment, we can really cater to the differences in the markets,” Buyk CEO James Walker told PYMNTS in an interview at the time. “Obviously, everybody’s going to buy Diet Coke and water, bread, milk, eggs — those things are universal. But really catering to the unique assortment driven by that hyperlocal customer is ultimately where we want to be in a market-by-market basis.”

Read more: Ultrafast Grocery Delivery Moves to the Midwest as Competition Heats Up