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Kroger Ship Expands Delivery Service To Digital Marketplace: Just The Facts

August 21, 2020 Joelle Beckett

Aiming to mirror the endless online aisles offered by Amazon and Walmart, the nation’s largest grocery retailer, The Kroger Co. is expanding its Kroger Ship delivery service. 

The addition of a new online interface and ecommerce platform - inclusive of third-party sellers -  will increase Kroger’s online inventory and provide consumers more choices in more categories.  

The expansion of Kroger Ship services is part of the grocery brand’s response to growing and evolving consumer grocery and houseware needs. Kroger's Senior Vice President and Chief Merchant and Marketing Officer Stuart Aitken said, "The expansion of our Kroger Ship platform will continue to bring together our industry-leading customer insights and merchandising data to offer our customers a digital shopping experience that includes staples available in our physical stores as well as products that are exclusive to Kroger.com." 

What Is The Expanded Kroger Ship Service?

Kroger Ship Service

Kroger launched its direct-to-consumer (DTC) platform, Kroger Ship, in 2018 as an online delivery service platform for non-perishable grocery products. This fall, by partnering with Mirakl, Kroger Ship will go beyond delivery services and become a holistic marketplace. Kroger Ship is expected to add more than 50,000 new products in various categories, such as international food, organics, housewares and toys, to Kroger’s merchandise inventory for it’s ship-to-home services. 

In 2018, Kroger announced ecommerce expansion plans including a partnership with UK-based online supermarket Ocado to develop its infrastructure by building 20 high-tech automated customer fulfillment centers (CFCs), called “sheds,” in the United States. The CFC sheds are being strategically built in regions across the U.S. that do not currently have traditional brick-and-mortar Kroger brand storefronts, helping Kroger provide their ecommerce customers with “anything, anytime and anywhere.” 

Why Did Kroger Co. Expand Kroger Ship?

Even before the global pandemic, the grocery industry projected that e-grocery services were the fastest-growing segment of the grocery retail market. However, as a result of social distancing, shelter-in-place and general health guidelines due to COVID-19, online grocery sales in 2020 accelerated beyond expectations and experienced record growth. According to the company’s press release, Kroger’s decision to expand Kroger Ship offerings was heavily supported by Kroger's growth in digital sales. In Q1 2020, Kroger’s digital sales grew 92%, motivating the brand to expand its merchandise options to better serve growing online consumer demand. 

"Our customers are increasingly turning to our ecommerce solutions provided at Kroger.com for their grocery and household essential needs. To better serve our customers, we're continuing to invest in technology that enables us to expand our digital services," said Jody Kalmbach, Kroger's Group Vice President of Product Experience. Kroger expects that expanding its Kroger Ship website with the Mirakl Marketplace Platform will help the brand better anticipate its customers needs and buying habits while also providing website visitors with a positive online shopping experience.

Why Is The Kroger Ship Expansion Important To Digital Marketing?

The more Kroger scales its online offerings, the more opportunities it provides digital advertisers to reach consumers. The expansion of Kroger Ship’s digital service positions Kroger to compete with fellow marketplace giants like Amazon and Walmart, for consumers and for advertisers.

Kroger’s self-service advertising platform, Kroger Precision Marketing (KPM), includes opportunities for advertisers to place banner display ads and product-listing ads influencing consumers when they are shopping and searching for products. The KPM platform allows brands full transparency into media performance and the ability to view in-store and online sales results attributed to advertising campaigns. Additional transparency can help marketers to learn about the purchasing decisions and shopping motivations of their target audiences. 

Digital marketers need to stay aware of where their audiences are spending time and how audience segments learn about new products. As more grocery and big box stores build out their ecommerce platforms and branded apps, marketers should anticipate time spent within these platforms to scale as consumers use the platforms to both search for and purchase products. 

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About the Author

An experienced content specialist with a dynamic skill set including news writing, graphic design and social media management, Joelle Beckett has established herself as an effective strategist in the world of digital marketing. At Digital Media Solutions (DMS), Joelle is a Content Manager, creating content for several DMS owned-and-operated websites and providing editorial, creative and technical support to team members. Joelle also researches, writes and edits in-depth articles weekly for DMS Insights, covering digital marketing trends, technology and innovative strategies for growth.

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