Target to expand several delivery services
On the heels of a strong performance sales-wise in its fourth quarter, Target announced a major rollout of several of its delivery services.
The retailer also announced it is raising its minimum hourly wage to $12 this year, part of its previously announced initiative to raise the minimum wage to $15 by 2020. The hike will start with existing associates.
On the delivery front, Target will expand “Drive Up,” its fastest delivery option, to nearly a thousand stores nationwide in 2018. The service, available through the Target app, allows shoppers to have their online orders brought out to their cars by a store associate within a couple minutes after arriving at the store.
In addition, the discounter also announced free two-day shipping on hundreds of thousands of items on Target.com with no membership required — an offer available when guests use their Target REDcard or spend more than $35.
Also, Target will expand its service that lets customers shop select urban stores and have their order delivered the same day for a flat fee. After last year’s successful pilot launch in four New York City stores, Target will roll out the service throughout the year to all stores in the five New York boroughs and select urban locations in Boston, Chicago, San Francisco and Washington, D.C.
Target is also expanding its “restock” overnight essentials delivery service. It will roll out in 2018 — to 40 markets total, covering nearly three-fourths of the U.S. population, by the end of the year.
“We’re always looking for ways to make it easier for our guests to get what they need on their terms,” said Mike McNamara, Target’s chief information and digital officer. “Thanks to investments in our supply chain and digital operations, we’re able use our stores to fulfill guests’ digital orders with flexibility and speed. With recent success, we’re eager to scale Drive Up and other fulfillment options to more guests in 2018.”
Target said it began testing its Drive-Up service last fall in the Twin Cities. With a nearly 10% increase in orders week over week since launch, it quickly became one of the highest rated fulfillment services shoppers in the area, the retailer said. Half of the shoppers that tried the service have used it again, according to Target.
The new service has been especially popular among shoppers with small children, with diapers and paper towels among the most ordered items through it. It’s also proven popular for purchases of bulky items, with cases of bottled water and soda, as well as home electronics like TVs, among the most ordered items.
‘No longer niche,’ Kroger increases presence at NatExpo West
Kroger on Tuesday shared its participation in the NatExpo West event in Anaheim, Calif. as part of its effort to continue building relationships with emerging brands.
“This is Kroger’s 16th year to participate in Expo West,” Jill McIntosh, Kroger vice president of natural foods, said. “Through our exclusive First Pitch and Town Hall events, we are increasing our presence and accessibility at the NatExpo West. This year is our biggest activation. We will have more than 40 Kroger representatives participate, ranging from buyers and category managers to merchandising executives.”
Kroger anticipates a robust number of suppliers engaging with the company’s representatives during its First Pitch event, which provides innovative, ready-to-go-to-market businesses the opportunity to present their products to the retailer.
“Our customers’ appetite for better-for-you products continues to grow year-over-year. The natural foods category has become mainstream — it is no longer a niche market,” added McIntosh. “Along with growing our Simple Truth brand, which reached $2 billion in annual sales in 2017, we will continue to focus on developing new partnerships at micro and macro levels to expand this category. Innovation is key in this space and this is one of the reasons we have attended Expo West since 2002 and recently started our Natural Foods Innovation Summit series.”
Kroger’s Town Hall will focus on its merchandising leaders sharing the Restock Kroger plan along with hosting discussions about ecommerce and Kroger Precision Marketing powered by 84.51° in front of an anticipated group of 500 individuals representing more than 270 suppliers. During the event, industry leaders, including CPGs and Kroger’s own Simple Truth and sustainability experts, will lead a panel about sustainable practices, a focus of the natural foods industry.
The Town Hall will also feature a celebrity chef tasting that spotlights Kroger’s Zero Hunger | Zero Waste initiative, which aims to end hunger in its communities and eliminate food waste in its company by 2025. Kroger is partnering with three distinguished chefs — Roy Choi, Phillip Frankland Lee and Chelsea’s Messy Apron — to host the event.
Kroger will host its third Natural Foods Innovation Summit this June in Cincinnati, Ohio.
Amazon expands Whole Foods delivery service
Amazon is expanding its grocery delivery service from Whole Foods Market to two new markets.
On Tuesday, the companies launched free, two-hour deliveries of natural and organic products from Whole Foods through Prime Now in Atlanta and San Francisco. The program initially launched last month in Austin, Cincinnati, Dallas and Virginia Beach, with plans for continued expansion across the U.S. throughout 2018.
Through the service, Prime members can order from “thousands of items” across fresh produce, bakery, dairy, meat and seafood, floral, among other everyday staples, all locally sourced items from Whole Foods Market. Select alcohol is also available for delivery to customers in San Francisco.
Prime members receive two-hour delivery for free, or they can pay $7.99 on orders of $35 or more, if they need groceries to arrive within an hour.
Customers can create an orders by visiting the Whole Foods Market selection on the Prime Now app available on Android and iOS devices, or on the Prime Now website.
The expansion coincides with Amazon’s ongoing efforts to integrate the two companies. Last month, the online giant announced that Prime members using their Amazon Prime Rewards Visa card at Whole Foods now earn 5% back on all purchases. This is in addition to the rewards they already receive, including 5% back on all Amazon.com purchases, 2% at restaurants, gas stations and drugstores, and 1% on all other purchases.
Non-Prime members that have the Visa card are entitled to 3% back. They also receive 3% back on all Amazon purchases, 2% at restaurants, gas stations and drugstores, and 1% on all other purchases.
Amazon acquired Whole Foods for $13.7 billion in September 2017.