Dive Brief:

• Hannaford has eliminated service charges for pickup orders of at least $125, the Northeast supermarket chain announced Tuesday. Orders that total less than that amount carry a $1.99 fee.
• The Ahold Delhaize-owned retailer has also boosted the number of time slots when shoppers can place pickup or delivery orders by 20%.
• Hannaford is looking to improve its pickup operations as the fulfillment channel remains highly popular with online grocery shoppers.

Dive Insight:

Hannaford’s effort to drive interest in pickup comes as grocers endeavor to strike an optimal balance between their interest in drawing people into physical stores and the need to accommodate consumers accustomed to the convenience of digital shopping.

While pickup order volume bounced around during 2023, the channel has established itself as the top choice among online grocery customers following the pandemic-driven surge in e-commerce that began in early 2020. But traditional supermarkets have been losing ground to mass retailers like Walmart that combine digital savviness with a strong reputation for low prices, data from Brick Meets Click and Mercatus show.

Grocers are also facing rising competition from Amazon, which has been refreshing its Amazon Fresh chain of traditional supermarkets and recently extended grocery delivery and free pickup to shoppers who don’t belong to its Prime membership program.

Hannaford noted in a press release about its updated pickup fee structure that it offers the same prices to pickup and delivery shoppers as it charges in its stores. But while Hannaford now offers pickup for free to shoppers who spend enough, it charges $10 for all delivery orders and requires a minimum purchase of $30 for that service.

Hannaford, which runs 187 supermarkets in Maine, Vermont, Massachusetts, New Hampshire and New York, suggested that it is hoping to build interest in its pickup service among shoppers in addition to encouraging people to place larger orders.

“We encourage customers who have not yet experienced Hannaford To Go to let us do the shopping for them and see for themselves just how easy, convenient and customizable it can be,” Mark Bradeen, director of e-commerce and digital marketing for Hannaford, said in a statement.

Last May, Hannaford began working with technology provider Flybuy to let pickup customers transmit their location to the store as they travel to collect their orders. The system helps employees time order preparation activities so they can have goods ready for immediate handoff when shoppers arrive.