Dive Brief:

• Giant Food has added grocery pickup to stores in Washington, D.C., Maryland, Virginia and Delaware, according to a company press release. The service began July 1 and will be available at 100 locations by the end of the year.
• Through Giant Pickup, shoppers order items online and choose same-day or next-day pickup. Same-day is only available for orders of $30 or more with a $2.95 fee. New customers receive free pickup on their first order.
• Participating Giant Food stores will have designated pickup lanes for Giant Pickup customers, where orders will be delivered directly to shoppers' cars. 

Dive Insight:

With the introduction of Giant Pickup, it's clear that parent company Ahold Delhaize is making a concerted effort to expand grocery pickup offerings across all its banners. In June, the company launched same-day pickup at 20 Stop & Shop locations across four East Coast states through Peapod. It also added a new grocery pickup program at Food Lion that fulfills orders in as little as one hour.

Tackling grocery pickup one banner at a time will help Ahold Delhaize gauge customer demand for e-commerce, particularly when it comes to their preferences for pickup versus delivery. According to a 2018 Nielsen report, 69% of shoppers said grocery delivery appealed to them, while four out of 10 used click and collect. Ahold Delhaize is focused on getting the service right before rolling it out across banners and to all stores, and giving itself room to make adjustments pending customer feedback. 

Giant is a smaller banner for Ahold Delhaize, but its location in the competitive Mid-Atlantic region makes it an important asset. Kroger's Harris Teeter has a strong presence in the region, and Wegmans has staked its claim recently as well. Aldi plans to expand there, recently announcing plans for a cutting-edge store in Washington, D.C. Lidl has set its sights on Maryland, Virginia and the nation's capital in its next wave of U.S. openings, with 25 new stores in progress. To remain relevant against these players, Giant Food has to offer a strong experience both online and in store. 

In addition to localized competition for each banner, Ahold Delhaize has to keep its sights set on powerful competitors including Walmart, which will offer grocery pickup from over 3,000 stores by the end of 2019, and Target, which has recently expanded pickup and delivery.

If Ahold Delhaize is too slow introducing innovation to its stores, it could lose market share to these larger national retailers. So far, the grocery company has been taking a slower pace toward e-commerce expansion compared to others despite its sizable footprint and deep pockets.