Regional grocers fight back in online grocery war

SpartanNash, for one, has its own subscription service and wants to roll out Prime-like extras for customers.


Jeff Wells, GroceryDive†

Aug. 8, 2019


In an effort to reduce customer wait times for its Fast Lane curbside pickup, SpartanNash recently began testing a state-of-the-art geofencing system. The program tracks shoppers' locations using the company app, providing updates to store staff so that an employee can deliver each order right as the shopper pulls up.


The system, which SpartanNash initiated in partnership with Radius Networks, has cut wait times from an average of eight minutes to practically zero, said Matt Van Gilder, the company's director of e-commerce, during a presentation at last month's Digital Food & Beverage Conference.


There's just one wrinkle: Walmart and Target already offer the same technology at hundreds of stores.


Fine-tuning e-commerce platforms can feel like a constant game of catch-up for regional grocers, many of whom rushed online in the months following Amazon's 2017 acquisition of Whole Foods. With fewer resources and technical prowess than the major chains, they lack the ability to be first in their markets to offer eye-catching innovations that can win shoppers over.


This could prove costly in the long-run. Despite all the sales growth projected to flow online in the coming years, analysts predict the spoils will not be distributed evenly. A report issued last year by Deutsche Bank analysts predicts large players with the ability to invest in services and navigate complex operations will gain market share over smaller competitors. The report estimated Amazon will increase its e-grocery market share to 19% by 2025 while Walmart will claim 17% and Kroger 7%.


But SpartanNash, which owns several regional grocery brands including Family Fare and Martin's Super Markets, isnít ready to concede too much ground to the likes of Walmart. Personal service and fostering a sense of trust are two areas where smaller grocery chains can win, Van Gilder said ó a belief underscored by the fact that many shoppers still don't trust someone else to buy their perishables for them.


SpartanNash drills its Fast Lane personal shoppers for days...