Harris Teeter rolls out new online subscription perks, fee structure

Dive Brief:

Harris Teeter will introduce a new tiered service fee structure for its ExpressLane online grocery service, including service fee waivers for orders of more than $100 and for senior shoppers on Thursdays from 9 a.m. to 2 p.m., the grocery chain announced in a press release on Thursday.
The grocer will charge a $4.95 service fee for orders between $25-$49.99 and a $2.95 fee for orders between $50 and $100. Online orders must be at least $25, except for subscription members, for whom the order minimum is waived.
The Kroger subsidiary also announced additional incentives to people who sign up for ExpressLane subscriptions, including double fuel points, 5% off Harris Teeter brand items and exemption from the company's normal $4.95 pickup charge.

Dive Insight:

Harris Teeter was an early player on the e-commerce grocery shopping scene, having been the first major retailer to pilot a cloud-based mobile wallet back in 2013. ExpressLane is still the only e-commerce site under the Kroger banner that operates separately from Kroger's online shopping service, as it was in existence prior to Harris Teeter's 2013 acquisition by Kroger.

The Harris Teeter e-commerce site enjoys familiarity among loyal customers, but as many more consumers turned to online shopping this year and with many expected to follow omnichannel shopping habits for years to come, it’s not enough for a grocer to just maintain its consumer base — it needs to grow.

Cutting down its service fees makes strategic sense for the mid-market grocer, as a 2020 report by Timothy Laseter, a professor at the University of Virginia's Darden School of Business, found that price was the biggest deciding factor for customers mulling a switch to online grocery shopping.

Revamping perks for subscription members, however, can be seen as a defensive move aimed at stopping reliable customers from shopping elsewhere, according to James McCann, a former CEO of Ahold USA. Harris Teeter charges subscribers $99.95 per year or $16.95 per month and offers annual subscribers extra benefits.

Kroger is behind the curve on delivery subscriptions compared to Walmart, which introduced its third e-commerce grocery buying option, an unlimited grocery delivery plan, in June 2019, and Albertsons, which began testing its delivery subscription service in July 2019. Hy-Vee announced a premium membership program, which offers free delivery and express pickup as well as a personal concierge service, in November.