Dive Brief:

• Bashas’ has launched its own e-commerce site through provider Instacart, according to an announcement from the online ordering and delivery company. The “white label” site, which plays down Instacart’s branding in favor of the retailer’s, will be available to customers in the Phoenix market.
• In March, Bashas’ began offering grocery delivery through Instacart in eight Arizona markets, including Phoenix, Scottsdale, Tempe, and Chandler. Since then, it has seen 13% weekly sales growth on online orders and twice the average basket size per order, according to Instacart.
• Bashas’ is the fifth retailer to use the new “Powered by Instacart” offering. Others include Whole Foods, Schnucks, Publix and Fairway Market. 

Dive Insight:

Two of the biggest concerns retailers have about partnering with third-party e-commerce companies are profitability and the customer experience. Will the deal make money? And will the grocer still have control of the brand experience — or will the online ordering and delivery provider overshadow it?

Instacart’s “Powered by Instacart” offering is its answer to that second concern. The new site, which for Phoenix customers will be bashas.instacart.com rather than instacart.bashas.com, is being touted as the retailer’s own standalone entity, and will play up Bashas’ branding while playing down Instacart’s.   

Will this distinction be apparent to consumers and have an impact on profitability? The difference between  the store having a portal within the Instacart system and having its “own” site powered by Instacart doesn’t seem significant enough for shoppers to notice. Other retailers have chosen a more distinct positioning through the service, including Schnucks and its “Schnucks Delivers” site.

But playing up Bashas’ logo and other elements so that they don’t clash with Instacart’s could have a subtle but meaningful impact. If nothing else, Instacart’s new offering proves that owning the customer experience online is a real concern for retailers.

Bashas’, which is one of Arizona’s largest grocery retailers, no doubt hopes e-commerce growth will complement its other recent updates. After voluntarily filing for bankruptcy in 2009 and then emerging just 13 months later, the company has been cutting costs, diversifying its services and remodeling stores. The company recently began updating its Diné Market stores, which primarily serve members of the Navajo Nation.

However, Bashas’ continues to feel the pressure from competing retailers, including Safeway, Whole Foods, Trader Joe’s and Sprouts Farmers Market. The company offered online ordering and delivery nearly a decade ago to customers in Phoenix and Tuscon, but discontinued the service due to lack of interest. Bashas’ is no doubt banking on better management, logistics and a more receptive audience. Certainly its prices, which were $14.95 for same-day delivery and $9.95 for next-day delivery 10 years ago, are better this time around.