Dive Brief:
- Tops Friendly Markets rolled out curbside pickup service through Instacart this weekend at its stores in Hamburg, Williamsville, and Tonawanda, N.Y., according to a press release.
- Customers choose their products on Tops' Instacart website, select a pickup time as well as a store location and then pay for their order. Instacart’s shoppers will pick and pack the products. Shoppers will then receive a text when their order is ready, proceed to the location’s designated parking spot for Instacart shoppers, and text back “here,” after which a store associate will bring out their groceries.
- Shoppers will be able to purchase the same meat, produce, and seafood as they would in-store but will also have access to the grocer's new online natural and organics store, topsorganics.com, which features thousands of organic, gluten free, and minimally processed foods.
Dive Insight:
As Tops continues to make its way out of bankruptcy, it's showing a willingness to try new things — store pickup being one example. The announcement builds on Tops' current same-day delivery partnership with Instacart, which recently expanded to 125 out of the chain's 169 stores.
But the test is hardly a revelation for the chain, with competitors like Wegmans already offering Instacart pickup while others, like Walmart, have built out their own curbside service. The Bentonville-based retailer currently offers click-and-collect at more than 1,800 stores.
Still, the service gives Tops an opportunity to reach more shoppers, and it shows the chain is deepening its e-commerce investments at a time analysts say building infrastructure is critical. Forrester Analytics predicts that the U.S. online grocery market will total $36.5 billion by 2022, up from about $26.7 billion this year.
Overall, more and more grocers are offering curbside pickup services, as it’s less expensive for retailers and cuts out pricey last-mile costs. In the past year, 46% of orders in the full-assortment grocery channel came through click and collect, up from just 18% the year before, according to Rakuten Intelligence.
Instacart’s explosive growth, meanwhile, has come in step with retailers' increasing realization that e-commerce is a channel to be taken seriously. In the past few years, the company has secured partnerships with dozens of grocers and expanded partnerships with high-impact ones like Kroger and Aldi. Instacart wants to keep adding value to those partnerships, and store pickup is seen by many grocers as a service that offers added convenience while also leveraging their greatest asset — brick-and-mortar stores.
This new service will add to Instacart's portfolio of partnerships and give Tops another avenue to gain customers. However, both companies face bigger challenges to their business as competitors threaten and consumer demand continues to evolve.
