Uber’s Meijer Partnership Expands Grocery Delivery to Drive Platform-Wide Sales

Uber has announced a grocery delivery partnership spanning hundreds of stores with Midwestern retailer Meijer.

According to a press release, Uber Eats is adding nearly 250 of the supermarket chain’s approximately 500 stores to its marketplace, expanding grocery delivery options in six states.

“Fresh food, fresh thinking and a focus on innovation makes [Meijer] a natural partner for Uber,” Christian Freese, Uber’s head of grocery and new verticals across the U.S. and Canada, said in a statement. “We’re thrilled to be bringing their fresh selection to Uber and Uber Eats across much of the country, and to be working together to deliver must-have groceries to America’s doorsteps, just in time for the holidays.”

The move is part of Uber’s ongoing strategy to expand its grocery presence not only to drive sales from those merchants themselves but also to boost platform-wide engagement.

“We are actively cross-selling delivery consumers, food delivery consumers into grocery consumers into alcohol and then actually back now to mobility as well,” CEO Dara Khosrowshahi told analysts on a call last month. “So, all of the cross-sell that we have across the platform continues to increase, drive new customers and also drive retention as well.”

That said, even aggregators without Uber’s diversity of verticals are looking to grow their grocery presence in a bid to ingrain their offerings deeper in consumers’ day-to-day routines. DoorDash, for instance, also has a partnership with Meijer, one that was included in the aggregator’s initial launch of its grocery vertical in August 2020. The company has been growing its presence in that category.

“Our new verticals, our convenience and grocery business is growing over 80% year on year,” DoorDash CFO Prabir Adarkar told analysts on the company’s most recent earnings call. “Our U.S. third-party grocery business is growing over 100% year on year, and that’s significantly faster than other companies that operate in this space.”

Meanwhile, No. 3 player Grubhub has been partnering with convenience eTailer Gopuff to  deliver groceries and other daily essentials.

Regarding this partnership, Just Eat Takeaway Chief Financial Officer Brent Wissink told analysts in October, “The trajectory seems positive, and I think we’ll see that and other similar partnerships expand as we march at a faster clip into grocery generally and other adjacencies in the U.S.”

When it comes to delivery, DoorDash is in the lead. Data from the latest edition of PYMNTS’ Provider Ranking of Aggregators, which leverages a proprietary combination of publicly available information as well as app usage data, has the San Francisco-based firm on top, with Uber Eats in second and Grubhub way down at No. 10.

While DoorDash may have the biggest slice of the pie, there is plenty to go around. Research from the latest edition of PYMNTS’ monthly ConnectedEconomy study, the “ConnectedEconomy Monthly Report: The Gender Divide Edition,” which drew from a survey of more than 2,600 U.S. consumers in October, finds that 42% of men and 28% of women order groceries from aggregators for same-day delivery each month.

Get the study: ConnectedEconomy Monthly Report: The Gender Divide Edition

Additionally, findings from PYMNTS’ October study “Super Apps for the Super Connected,” created in collaboration with PayPal, based on responses from 9,900 consumers across the United States, the United Kingdom, Australia and Germany, found that the majority of consumers shop for grocery online, with a share ranging from 64% to 76%, depending on the generation.

Read the full report: Super Apps for the Super Connected