Uber Eats extends grocery delivery reach with Albertsons

Uber Technologies Inc. has landed Albertsons Cos. as a major retail partner for its Uber Eats on-demand delivery service.

San Francisco-based Uber said Monday that Uber Eats grocery delivery is slated to roll out to 1,200 Albertsons Cos. stores this year. Some Albertsons Cos. retail banners previously offered the service through selected locations.

Albertsons Cos. customers — including banners such as Albertsons, Safeway, Jewel-Osco, Acme, Tom Thumb and Randalls, among others — can access the online grocery and food delivery service via the Uber and Uber Eats apps. Uber Pass and Eats Pass users get free delivery for grocery orders over $30.

Uber noted that the Albertsons partnership marks its first major grocery expansion in the United States, more than doubling the same-day service’s reach to over 400 cities and towns since its launch last July. Uber Eats grocery delivery is now available in major markets such as Miami, Dallas, New York City, San Francisco, Phoenix and Washington, D.C., and through regional and local supermarket retailers like Southeastern Grocers and New York’s Red Apple Group.

Albertsons customers can access the online grocery and food delivery service via the Uber and Uber Eats apps.

Plans call for Uber to add more grocery delivery markets during 2021.

“This past year has been one of incredible growth for grocery delivery,” Raj Beri, global head of grocery and new verticals at Uber, said in a statement. “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.”

Related:Walgreens launches same-day delivery via Uber Eats

Uber also has gone the acquisition and partnership routes to bolster its delivery capabilities and serve new market segments. In December, the company finalized its $2.65 billion purchase of Postmates — following an unsuccessful effort to acquire meal delivery service GrubHub — and then in February purchased on-demand alcohol delivery app Drizly for $1.1 billion. Also, in May, Uber partnered with Gopuff to provide delivery of everyday essentials such as food, drinks, household, personal and beauty care items via Uber Eats.

Those deals came after an October 2019 agreement to buy a majority stake in online grocery service Cornershop, which provided Uber a springboard into the grocery delivery space. Uber acquired the remaining 47% interest in Santiago, Chile-based Cornershop last month.

For Boise, Idaho-based Albertsons, Uber represents another key delivery partner. The grocer, with nearly 2,300 stores in 34 states and Washington, D.C., has been steadily expanding online grocery delivery across its retail banners. Instacart is delivery available through more than 90% of its stores, and last month the retailer unveiled a deal with DoorDash to provide last-mile grocery delivery service at almost 2,000 stores. Some Albertsons retail banners also work with Shipt, a Target Corp. subsidiary.

Related:DoorDash, Uber Eats, Instacart challenge major e-commerce retailers

The expansion stems from a plan to increase use of third-party delivery. In January, Albertsons said it was shutting down its own online grocery delivery operation — offered at about 65% of its stores — in some of its market areas and shifting exclusively to third-party delivery providers. Albertsons discontinued the use of its home delivery truck fleet in 10 states as of Feb. 27.

Edge by Ascential predicts third-party providers of on-demand food delivery — including DoorDash, Instacart and Uber Eats — to overtake some of the largest U.S. retailers in e-commerce sales by 2025.

The researcher’s Edge Retail Insight arm projects U.S. gross merchandise value (GMV) sales to more than double at Instacart and Uber Eats by 2025, surpassing Target.com. And DoorDash, the nation’s largest app-based restaurant delivery service, is expected to eclipse eBay.com in GMV sales by 2025 to become the third-biggest U.S. e-commerce banner, behind Amazon.com and Walmart.com.