Just when you thought Uber Technologies Inc. (NYSE: UBER) had perhaps put too many eggs in its basket, it’s putting eggs in consumers’ baskets – straight from the grocery store.
The company on Monday announced its largest grocery expansion since launching in July 2020, with the company’s same-day and on-demand scheduled grocery delivery now being offered in over 400 U.S. cities and towns. The move, Uber’s first major grocery expansion in the U.S., will more than double the availability of its grocery delivery service.
The expansion will cover several major markets from coast to coast, including San Francisco, New York City, Washington, Miami, Dallas and Phoenix, with several more locations still to come in 2021.
Uber enters the playing field
“This past year has been one of incredible growth for grocery delivery,” said Raj Beri, Uber’s global head of grocery and new verticals. “Today nearly 3 million consumers order groceries and other essentials each month through Uber and we’re just getting started. By adding thousands of beloved grocers to our selection this year, we are fast-tracking our efforts to help Americans get everything they need from their favorite supermarket delivered to their doorsteps.”
To accelerate the rollout of its expanded services, Uber is partnering with Albertsons Co. Inc. (NYSE: ACI) and 1,200 of its grocery stores, including familiar names like Safeway, Jewel-Osco, ACME, Tom Thumb and Randalls. With an even larger network in place, Uber hopes to cut grocery delivery times from days to hours — or even minutes.
Uber isn’t the only company growing its presence in the grocery delivery space, nor is it the only business to partner with Albertsons. Last month, DoorDash (NYSE: DASH) announced its own collaboration with Albertsons and nearly 2,000 of its banner stores, while Instacart established a relationship with the national grocer years ago.
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However, it’s unclear whether shoppers will continue to have their groceries delivered after COVID-19 conditions subside and the country returns to normalcy. Since March 2020, online grocery delivery and pickup sales have grown, peaking at $7.2 billion in June of last year, but they have since plateaued. In May, the most recent month for which data is available, the market for online grocery delivery and pickup dipped to $5.3 billion but still above the $4 billion it raked in at the start of the pandemic.
That hasn’t stopped companies from continuing to innovate within the space. Instacart, one of the industry’s pioneers, recently added nearly 6,000 7-Eleven locations to its arsenal of stores, and it has plans to go global. Meanwhile, Amazon (NASDAQ: AMZN) is starting to show interest in capitalizing on its 2017 acquisition of Whole Foods, perhaps preparing to enter the same-day grocery delivery space.
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