Dive Brief:
- Giant Food announced on Tuesday that it's the first Ahold Delhaize banner to launch the company's Ship2Me online marketplace.
- Integrated into the grocer's e-commerce platform, Ship2Me "significantly" expands the company's assortment beyond traditional grocery products by adding "tens of thousands" of items, like home décor, outdoor goods, pet supplies, dining and premium pantry items.
- The Ahold Delhaize banner said Ship2Me is featuring categories that complement grocery but aren't usually found in stores, further incentivizing online shopping adoption by customers.
Dive Insight:
The new online marketplace is the latest step by Giant Food to make e-commerce more appealing to consumers.
Ship2Me not only expands product categories, but also blurs the line between grocery shopping and general merchandise purchasing, with the goal of building larger baskets and keeping shoppers engaged with the grocer's platform. Ship2Me purchases will ship by ground for free and carry no order minimums. Shoppers enrolled in Giant Food's rewards programs can earn points on Ship2Me purchases, which can be redeemed for grocery or gas savings.
Ahold Delhaize has said it's launching the Ship2Me marketplace at additional banners in the coming months, but hasn't provided a timeline for the rollout. The endless-aisles service will carry around 40,000 products initially, the company reported when it issued its third-quarter earnings last month.
During Ahold Delhaize's Q1 earnings call in May, Chief Financial Officer Natalie Knight said Ship2Me will offer a "seamless" checkout experience that offers a fuller shopping experience for customers. The service could have as many as 100,000 products, she said during the call.
"It allows us there to capture... the incremental margin opportunity of general merchandise with the frequent shopping that we experience in our stores," she said
Amazon and Walmart have pioneered the online marketplace strategy, which relies on outside vendors to supply products to customers, thus boosting online assortments without requiring retailers to build additional warehousing and shipping capabilities. Kroger launched its online marketplace last year, which focuses on specialty goods and general merchandise, and recently announced a multi-category collaboration with Bed Bath & Beyond, furthering its product assortment beyond grocery.
Like other grocers, Giant Food has seen online shopping take off during the pandemic. "Giant's online offerings have exploded in popularity the past 12 months, with over three million online orders fulfilled," the company stated in its latest announcement.
The Ship2Me launch is the latest effort by the grocer to boost appeal of its own digital services at a time when e-commerce profitability is top of mind for the industry. In September, Giant Food slashed order fees and minimums for purchases made through its in-house e-commerce services in order to attract shoppers to its own offerings and encourage weekday orders.
Also on Tuesday, Ahold Delhaize announced it's rolling out Instacart's 30-minute convenience delivery service to all of its banners, including Giant Food.
