The Kroger Co. announced they are expanding their Kroger Ship program this fall to include an online marketplace of more than 500,000 ship-to-home items available through third-party sellers. Kroger has partnered with Miraki, a SaaS platform that enables B2C and B2B marketplaces, to facilitate the expansion. Kroger launched the Kroger Ship program in August 2018 to make online shopping easier for their customers.
The Kroger Ship expanded program will include products across various categories include food, specialty items, housewares and toys. Kroger, who claims it is the largest grocery retailer in America, could use this opportunity to compete against Amazon. Customers who place eligible orders from Kroger.com can earn loyalty rewards including fuel points.
“Our customers are increasingly turning to our e-commerce 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 to deliver anything, anytime, anywhere,” said Jody Kalmbach, Kroger's group vice president of product experience, in the August 11 announcement.
“Leveraging Mirakl's best-in-class marketplace solution, we are broadening Kroger's ship-to-home capabilities by offering more relevant products for our customers through exciting new partnerships with reputable third-party sellers,” Kalmbach added.
Stuart Aitken, senior vice president and chief merchant and marketing officer for Kroger, also commented on the expanded Kroger Ship program.
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“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,” said Aitken. “As part of our continuing transformation, we look forward to accelerating the development of our e-commerce platform and providing our customers with even more choices.”
In terms of their grocery retail business, Kroger operates under various names and brands:
- Kroger and Kroger Marketplace
- Dillons and Dillons Marketplace
- Smith’s and Smith’s Marketplace
- King Soopers and King Soopers Marketplace
- Fry’s and Fry’s Marketplace
- City Market
- Jay C
- Pay Less
- Harris Teeter
- Pick ‘n Save
- Metro Market
- Fred Meyer
- Food 4 Less
- Foods Co.
Kroger first quarter financials
In June, the Kroger Co. reported its first quarter financials, for the period ended May 23, 2020, which included an update on the company’s COVID-19 response and impacts and an update on the company’s Restock Kroger initiative, a three-year plan to transform the company. Here are highlights from that earnings report.
- Total sales for the quarter were $41.5 billion, compared to $37.3 billion for Q1 2019.
- The company had operating profit of $1.3 billion, and adjusted earnings per share of $1.22.
- Digital sales increased 92% year-over-year.
- The company invested more than $830 million to help keep its associates and customers safe. This investment included ‘thank you pay’ for frontline workers.
- The company hired more than 100,000 new associates, expediting their hiring process.
- The company helped text more than 82,000 patients in 15 states for COVID-19 and provided walk-up testing for the most vulnerable people in various communities.
- The company launched The Kroger Co. Zero Hunger | Zero Waste Foundation’s Emergency COVID-19 Response Fund to help families impacted by the pandemic. The foundation was committed over $8 million to nonprofits dedicated to addressing urgent pandemic response efforts.
- The company also contributed $15 million to their Helping Hands fund to provide financial support to associates experiencing hardships caused by COVID-19, including childcare costs.
Kroger is the latest retailer to try to take on Amazon. Walmart, Target and others have tried to adapt their online marketplaces to compete with Amazon. Most recently, for example, Walmart launched (another) paid membership service. Priced at $98 a year and offers members same-day delivery on groceries and other products as well as some special discounts.
With Kroger’s resources, the company could see success with their expanded Kroger Ship program, but they will have to execute it well, and grow well beyond 500,000 products. Competing against Amazon is a pretty big lift, but in a COVID world, having more choices is ultimately better for consumers. If Kroger does the Kroger Ship marketplace right, it could be good for them too.