- Aldi is piloting online deliveries in the US
- The discounter has partnered with Instacart for the trial
- Aldi is testing the service in Los Angeles, Atlanta and Dallas
Aldi is launching an online delivery service in the US after partnering with fulfilment provider Instacart.
The discounter, which has around 1,600 stores in the US, will start piloting home deliveries at the end of this month in Los Angeles, Atlanta and Dallas.
Aldi does not currently offer online shopping in the American market, although it has started selling wine and its general merchandise special buys online in the UK.
The partnership with Instacart will allow it to test demand for online groceries as the US increasingly adopts digital capabilities.
A report published by the Food Marketing Institute and Nielsen in January estimated online grocery spending to grow from 4.3% of US food and drink sales to as much as 20%, or $100bn, by 2025.
Online grocery sales in the US totalled $20.5bn last year.
Aldi’s tie-up with Instacart will allow shoppers to order goods through the Instacart website and smartphone app.
Instacart will fulfil orders by picking items up from Aldi stores and delivering them to customers’ homes is as little as one hour.
Shoppers will pay Instacart the usual delivery fee to use the service.
- This is a significant move from Aldi and shows how online is playing a bigger role in US grocery. We also view it as indicative of Aldi’s attempts to position itself as a more mid-market player in the US by appealing to the more sophisticated and digital-native groups in this customer base.
- Instacart enters a new channel – discount – with this deal. Having recently secured an extra $400m in funding, the business is now profitable in 25 of its 35 US markets and expects to see full profitability by year end. Maintaining and sustaining growth is dependent on how many retailers it can tempt to use its services. With more than 130 US retailers now working with it, Instacart appears to be the go-to provider for grocers seeking a quick, easy and cost-effective method of going online.
- Suppliers should look to partner strategically with Instacart. It has been working successfully with major FMCGs on promotions and digital couponing targeted at app users according to their shopping habits. Aldi will want to see if it can drive private label sales via this partnership so suppliers should give consideration to online-only multi-buy offers as a volume driver.
Howard Lake is senior editor at Planet Retail RNG
Aldi was joined in the US by its German rival Lidl earlier this year when it launched its first stores in the country.
The American grocery sector is going through seismic shifts as the discount duo drive down prices and more established players turn to M&A activity to beef up their market shares.
Etail titan Amazon is acquiring Whole Foods Market and Walmart is bolstering its ecommerce expertise after buying Jet.com and upping its stake in JD.com.
Until now, Aldi has focused on its bricks-and-mortar presence in the US, revealing in June that it would plough $3.4bn into taking its store estate past the 2,500 mark by 2022.