From CNBC:

Major U.S. retailers like Walmart, Target, and Kroger are ramping up their same-day delivery services to compete for grocery shoppers. With fast deliveries becoming a key strategy, Walmart now offers early morning drop-offs, while Target launched a paid membership program called Target Circle 360 for same-day deliveries.

Kroger reported over 10% year-over-year growth in digital sales, with a 24% increase in delivery sales in the recent quarter, attributing much of this growth to home deliveries. This move by retailers not only improves convenience but also capitalizes on their physical store locations’ proximity to customers’ homes compared to e-commerce giants like Amazon.

Numerator, a market research firm, estimated that Walmart holds 23.6% of the market share in the U.S., making it the largest grocer, followed by Kroger with 10.1% and Target in ninth place with 2.7%. The new paid membership programs launched by Walmart, Target, and Kroger all require a minimum spend for home deliveries.

Target Circle 360, a $99 yearly membership program, offers same-day deliveries with the option for customers to sign up for $49 during a special promotion. Walmart+ costs $98 annually, while Kroger’s Boost program offers $59 and $99 yearly options, both with free delivery perks based on order spend thresholds.

Walmart and Kroger have remained tight-lipped on their subscriber counts, while Target boasts over 100 million members in its free loyalty program, Target Circle. These retailers strive to differentiate themselves by providing speedy deliveries, collecting valuable customer data, and enhancing customer experience to drive more frequent and personalized online orders.

Grocers like Target face challenges in boosting sales as they transition to selling more essential items like food and household products to meet customer needs. Kroger has expanded into new regions using online delivery services, contributing to its double-digit sales growth expectations for the upcoming year.

Kroger’s CEO emphasized the importance of digital technology as an essential growth driver, driving over $12 billion in sales for 2023. With fierce competition from other grocers, Kroger aims to keep up with changing shopping preferences and defend its efforts to acquire Albertsons amid FTC scrutiny.

While the three retail giants see delivery services as crucial for growth, they also grapple with attracting price-conscious shoppers who remain cautious despite economic improvements. Both Walmart and Target exceeded holiday quarter sales expectations but noted continued value-focused consumer behavior.



Read more at CNBC: Walmart, Target and Kroger compete on grocery delivery