Kroger’s foray into meal delivery highlights seafood

Published on
December 5, 2019

Kroger’s new meal delivery service, via a partnership with ClusterTruck, features an expansive menu with multiple seafood options, such as Chipotle Shrimp Tacos and a Poke Bowl.

Kroger partnered with ClusterTruck, a software platform that powers vertically integrated delivery-only kitchens, to launch Kroger Delivery Kitchen. The partnership allows Kroger to offer multiple menus – including breakfast, street food, and burgers – of fresh meals from one central scratch kitchen.

“Kroger Delivery Kitchen Powered by ClusterTruck will allow our customers to access restaurant-quality fresh and delicious meals like never before and without having to pay excessive service or delivery fees,” Kroger Chief Information Officer Yael Cosset said in a press release.

Kroger is initially rolling out the service in Carmel, Indiana, where Kroger and ClusterTruck are jointly opening a fourth kitchen, along with Indianapolis, Indiana, and Columbus, Ohio. Meanwhile, King Soopers Delivery Kitchen Powered by ClusterTruck will serve customers in Denver, Colorado.

Indianapolis-based ClusterTruck's “dark kitchens” are powered by a proprietary software system that uses custom algorithms to optimize kitchen and delivery operations.

“This systematic approach to meal delivery ensures that nearly every order is in the hands of the customer within seven minutes of the meal's preparation. The average time between placing an order and a customer receiving their food is less than 30 minutes,” Kroger said.

Kroger Delivery Kitchen’s seafood meals include: Poke Bowl with raw ahi tuna for USD 15.99 (EUR 14.40), Chipotle Shrimp Tacos for USD 10.49 (EUR 9.45), and Smoked Salmon Bagel for USD 14.49 (EUR 13.05).

"ClusterTruck's ultra-fresh and quick made-from-scratch meals set them apart in the food delivery landscape. Kroger Delivery Kitchen customers can order pizza or pad thai on the same order and get it delivered hot and fresh, within minutes of the meals being prepared,” Kroger Group Vice President of Fresh Suzy Monford said.

While there is consumer demand for convenient, restaurant-quality meals, as 58 percent of Americans’ restaurant meal occasions are off-premises, Steven Johnson, a grocerant guru at consultancy Foodservice Solutions, has doubts about Kroger’s ability to succeed with the new meal-delivery service.

“I’m not sure they have the ability to adapt to or tap into consumers’ meal mindset,” Johnson said. “Kroger has many of the right tactical components of selling meals in place yet, with all of their experimenting, they have yet to show any willingness to evolve their stores and brand forward.”

For example, Kroger continues to remodel stores that “look more like yesterday than today,” Johnson said.

In related news, Kroger’s stock fell on 5 December after the retailer reported that its quarterly bearings were USD 0.47 (EUR 0.42) per share, lower than forecasts of USD 0.49 (EUR USD 0.44). While quarterly sales increased to USD 28 billion (EUR 25 billion), they were slightly below estimates for USD 28.2 billion (EUR 36.1 billion) in the quarter.

Kroger also announced its plan to divest from Lucky’s Market, a natural grocery chain based in Colorado. And Kroger has made heavy investments as part of its “Restock Kroger” transformation program to grow online sales, improve delivery, and modernize stores, Reuters reported.

To succeed, Kroger’s delivery service will need to target shoppers with menu and meal-focused branded invitations, Johnson said.

“The key to successful customer adoption will be at the intersection of the consumer targeted and the price, value, and service offered,” he said. “That is where Kroger seems to stumble most often.”

Kroger Delivery Kitchen’s seafood offerings will perform “very well, if they empower mix-and-match meal bundling of seafood entrees and side orders, as they are hallmarks of grocerant niche food sales success,” Johnson said.

Photo courtesy of Kroger

Contributing Editor



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