Kroger Launches Same-Day Service, Pushes on Other Digital Fronts

Kroger, demonstrating why it is a force to be reckoned with in e-grocery, is now offering same-day delivery in five markets, while also testing out self-driving delivery in a Phoenix pilot and creating automated distribution centers with partner Ocado.

The Cincinnati-based company is making an all-out push to not get left behind in the grocery wars against bigger competitors including Amazon, Walmart and Target, investing billions in the process.

The Kroger Ship same-day service will be available in its hometown of Cincinnati as well as Houston, Louisville and Nashville, with new markets added over the next few months. Initially customers can order from a curated selection of 4,500 Kroger-branded products, as well as 50,000 center aisle groceries and household essentials.

The service will be powered by natural foods and supplements ecommerce marketplace Vitacost, which Kroger acquired in 2014. It will likely be expanded through Kroger’s new partnership with cutting-edge British online grocer Ocado and its state-of-the-art fulfillment and distribution technology.

In addition to investing 5% in Ocado, Kroger and its partner are identifying the first three sites to build automated distribution centers in the U.S., with plans for an eventual 20 facilities over the next three years.

“Kroger’s ecommerce platform expands our offering beyond the physical store to include even more products,” said Yael Cosset, Kroger’s chief digital officer, in a release. “Along with staples and customer favorites, Kroger Ship will carry bulk and additional sizes, and focus on Our Brands, local and international food and flavors, specialty items, and health and wellness products.”

The Ship service is free on orders over $35 and $4.99 otherwise. The company already provides delivery from 1,200 of its 2,800 grocery stores and curbside pickup at 1,250 locations though its Clicklist service.

Meanwhile various reports have Kroger starting up a driverless delivery test in Phoenix powered by autonomous vehicle startup Nuro. The latter is looking to hire managers for the service. Apparently Phoenix is ground zero for autonomous vehicle pilots, as Walmart has a program going there with partner Waymo, a division of Google parent Alphabet Inc.