Dive Brief:
- Instacart announced Monday that Cut+Dry, an e-commerce and ad platform for foodservice distributors and manufacturers, will integrate Instacart’s advertising solutions, called Carrot Ads, to help expand its ad capabilities.
- Instacart said the tie-up will provide advertisers in the foodservice space with direct access to buyers as well as create new revenue opportunities for distributors and operators.
- The Cut+Dry partnership is part of Instacart’s strategy to diversify and scale its ad technology, Andrew Nodes, vice president and general manager of Instacart Business & Supply Chain, said in an emailed statement.
Dive Insight:
By creating new avenues for foodservice operators and distributors to connect with brands, Instacart will bolster its booming advertising solutions business, Nodes told Grocery Dive.
Advertising and other revenue for Instacart was up 11% year over year during the third quarter, to $246 million, accounting for 3% of the company’s gross transaction volume. Launched in 2023, Carrot Ads technology now has nearly 220 retailer banner partners, Instacart said.
With the partnership, foodservice operators can access detailed product information, recipes and menu ideas, while distributors can get additional revenue through digital ads, and manufacturers can boost brand visibility and influence in foodservice sales, Nodes said in the announcement.
Cut+Dry’s collaboration with Instacart aims to address advertising difficulties that foodservice manufacturers face, including sharing brand stories and product benefits, Cut+Dry CEO and co-founder Mani Kulasooriya said in the announcement.
Sales for the retail foodservice sector increased by 1.4% to roughly $51 billion in 2024, according to NIQ data cited by FMI —The Food Industry Association.
As retail media has taken off in the grocery industry, Kulasooriya said foodservice distributors “have been left out of the rapidly growing digital advertising space.”
“By giving brands a direct line to foodservice operators and distributors through Cut+Dry’s extensive network, they can now showcase their products at critical decision points – like when operators are planning menus or placing orders,” Kulasooriya said in an emailed statement.
