Kroger Pilots 30-Minute Grocery Delivery as Digital Sales Spike 42%

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Kroger Pilots 30-Minute Grocery Delivery as Digital Sales Spike 42%

By Jamie Grill-Goodman - 06/21/2019
Kroger Rush will deliver items within as short a time as 30 minutes.

As The Kroger Co.’s e-commerce sales spike, the grocery retailer is expanding its digital prowess.

“Our efforts are positioning Kroger to be the leading omnichannel retailer in the food industry,” chairman and CEO Rodney McMullen said in the retailer’s recent earnings call.

Kroger is currently piloting Kroger Rush, a grocery service that can deliver items within as short a time as 30 minutes, at two stores in the Greater Cincinnati area, according to Business Courier.

The service launched in the spring and is available for now to a limited number of customers who live within a three-mile radius of the two stores and place orders through the Kroger Rush app.

Kroger’s website features a Kroger Rush FAQ page that describes the service as a “need-it-now delivery service, offering immediate order processing and quick delivery.”

The webpage notes that the goal of the service is to deliver every order within 30 minutes, however “there are a number of factors that impact that time: number of orders received, shopper/driver availability and order size. Available for Rush delivery are “need-it-now items,” consisting of “everyday essentials” that a customer may have a sudden need for, including alcohol.

Kroger’s digital sales grew 42% in its first quarter of 2019. Since 2014, the grocery retailer has gone from no digital sales dollars to a 2018 annual run rate of about $5 billion, which is expected to trend toward a $9 billion digital sales run rate in the future.

The retailer also reported it expanded its coverage area in Q1 to reach 93% of its customers.

“This means 93% of the customers who shop Kroger in a brick-and-mortar store also can shop with us for pick-up or delivery,” said McMullen. “By the end of this year, everyone in America will have the ability through our modalities to shop with Kroger, whether they decide to come into a store, use our pick-up or delivery services, or Ship.”

Kroger also continues to partner with industry innovators such as Home Chef, Microsoft, Ocado, and Walgreens, which McMullen said are helping accelerate Kroger’s “ability to provide customers anything, anytime, anywhere.”

“Each partner shares our passion for exploring the nexus between technology and innovative customer experiences,” he noted.

Additionally, Kroger broke ground last week in Ohio on America's first customer fulfillment center powered by Ocado.

“Kroger's partnership with Ocado will for the first time introduce transformative e-commerce fulfillment and logistics technology in America,” said McMullen. “This in turn means Kroger customers will get fresher food faster than ever before. We intend to open additional customer fulfillment facilities to create a seamless customer experience, replicating the model to serve everyone across America.”