Dive Brief:
- DoorDash announced Thursday that it has launched an “express” grocery delivery service that can bring orders to customers in less than 30 minutes.
- The service is currently available from more than 300 Albertsons stores, offering a selection of more than 6,000 products like eggs, milk, produce and snacks. Express delivery will expand to additional Albertsons stores in the coming weeks and roll out with other grocery chains in the coming months.
- DoorDash is going toe to toe with Instacart in offering faster delivery and a range of services as grocers look to boost e-commerce demand.
Dive Insight:
DoorDash has rapidly built up its online service offerings for grocers as it challenges Instacart’s e-commerce dominance in the industry. With this latest launch comes an offering that enables grocers to deliver small-basket orders to shoppers in less than an hour.
In an interview, Fuad Hannon, DoorDash’s vice president of new verticals, said these quick deliveries boost online demand during normally off-peak times. During its pilot of the express service with Albertsons, which began in October and lasted through January, DoorDash found that many orders happened on Wednesdays, which are typically slow days for e-commerce, and that 44% of orders were placed between 4 p.m. and 9 p.m., in contrast with the early-morning orders people often place for full-basket shops, indicating shoppers are using the express service for last-minute meal ingredients or a fill-in order.
“It's a very, very different occasion than traditional e-commerce and actually is more similar to traditional restaurant delivery,” Hannon said.
To order from DoorDash’s express service, shoppers can search “Rapid Grocery” stores in the DoorDash app or filter for grocery delivery in under 30 minutes under the app’s Grocery tile. From there, they can peruse a limited assortment of several thousand items that consumers typically target for fill-in trips and impulse buys, like fresh produce and snacks.
DoorDash noted in its announcement that it does not guarantee 30-minute delivery, and that this timing claim is based on average delivery times at Albertsons stores from October 1 through January 31. Hannon said DoorDash worked with Albertsons to determine the service radius around its stores and the items it will offer to ensure it can offer that sub half-hour service as often as possible.
The service with Albertsons is integrated with DashPass, DoorDash’s membership program, with members able to receive free delivery on orders of $12 or more.
Albertsons has worked closely with DoorDash on other services, including alcohol delivery and DoubleDash, which lets shoppers add an order from a restaurant or convenience store to their grocery delivery. Albertsons also offers delivery through Instacart and Uber as it has scaled down its own delivery services and scaled up services led by third-party companies.
DoorDash’s express rollout comes several months after close rival Instacart launched its own 30-minute delivery service. Grocers like Kroger, Publix and Stop & Shop have integrated the offering since then and slapped their own branding on it. Kroger Delivery Now kicked off in September offering 25,000 products to shoppers nationwide, while Publix Quick Picks is available across that grocer’s seven-state footprint.
These 30-minute delivery services offer a wider assortment than what instant needs delivery companies like Gopuff and Getir offer, and retailers are hoping that this will help them compete against these startups as they extend their reach. DoorDash offers its own instant-needs service, DashMart, which recently kicked off a 15-minute delivery service in New York City. And just this week Grubhub announced the launch of its on-demand convenience offering, Grubhub Goods.
Jordan Berke, founder of consulting firm Tomorrow Retail and a former e-commerce executive with Walmart China, said grocers are looking to faster delivery services as a way to generate demand among young shoppers.
“Quick commerce is being seen as a very attractive demand opportunity for a lot of retailers,” he said in a recent interview, noting that he expects most of the top 20 grocers in the U.S. to offer a quick delivery option by the end of this year. “They're seeing the potential to win a new trip.”
In addition to its store-based express service, DoorDash is also exploring ways to offer its DashMart operation as a service for retailers. Hannon, who noted the effort in an interview late last year, declined to offer an update on that program in Wednesday's interview. Instacart is also pushing into dark store services through its tie-up with micro-fulfillment company Fabric — an effort aimed at improving order accuracy and operational efficiency as well as allowing retailers to move inventory closer to where shoppers live.
