Albertsons Companies Inc. already works with a range of delivery partners for its grocery orders, but that group has now expanded nationally to include Grubhub. Albertson announced a new partnership with Grubhub on June 25. As a result, it will offer home grocery delivery from almost 1,800 stores within the family of nearly 2,300 that it operates. In addition to Albertsons, the service will be available under the company’s other banners: Safeway, Vons, Jewel-Osco, Shaw’s, ACME and Tom Thumb.

Albertsons is No. 24 in Digital Commerce 360’s Top 1000, a ranking of North America’s leading retailers by online sales. The company appears in the rankings’ Food & Beverage category. Digital Commerce 360 projects total ecommerce sales for Albertsons in 2024 will be $5.52 billion.

Albertsons ecommerce sales by year

Why Albertsons is partnering with Grubhub for delivery

Amber Kappa, vice president of business development and digital innovation at Albertsons Co., framed the partnership in the context of the grocer’s prioritization of “convenience, choice and variety.”

“With our latest collaboration with Grubhub, shoppers can receive fresh produce, household essentials, and regional favorites directly from our stores to their homes with a simple tap on Grubhub,” she said in a public statement.

Analysts and insiders see the partnership as offering strategic benefits to both parties and customers.

Damian Rollison, director of market insights at the brand marketing platform SOCi, said that the Grubhub and Albertsons alliance makes sense.

“The partnership between Grubhub and Albertsons marks a strategic move for both companies to capture a larger share of the online grocery delivery market,” Rollison says.

Delivery strategy at Albertsons

Rollison said this collaboration expands Albertsons’ digital footprint and enhances customer convenience. He also noted that it diversifies delivery options alongside existing Albertsons partnerships with Instacart and DoorDash. In addition, it responds to consumer demand for increased digital availability of common local needs, including groceries.

Rollison said Grubhub’s entry into the grocery delivery market uses its established logistics and customer base. Moreover, it will tap into a new revenue stream as online grocery shopping continues to grow.

“Partnering with a major chain like Albertsons also strengthens Grubhub’s competitive position by offering a more comprehensive service portfolio,” Rollison assessed.

He called this partnership the latest example of a food delivery company trying to become an “everything app” connecting consumers to local stores.

“This partnership sets a precedent for future collaborations in the online grocery delivery space, reflecting the current consumer retail behavior,” Rollison says.

Opening up a new channel for discovery

While home grocery delivery has become a fairly standard service since the pandemic, Jennifer Silverberg, CEO of the ecommerce platform provider SmartCommerce, says that Albertsons’ partnership with Grubhub has a crucial difference from in-house delivery services like ones run by Kroger: “Grubhub is not talking about being the fulfillment engine of an order that happens on an Albertsons site,” Silverberg said (though that may happen, too). Rather, she sees it as being more about using Albertsons as a product source, or de facto “warehouse” for products purchased on Grubhub.

“This moves the shopping experience from Albertsons to Grubhub, which reflects what we have been seeing for a while, where product discovery and now even the transaction have become distributed, rather than concentrated only at the retailer,” Silverberg stated.  She added that the trend has expanded the definition of a retailer to pretty much anywhere a product is purchased.

“We have the potential to see a fundamental change in what we as consumers consider a store,” Silverberg said. She called the partnership “a very smart move” for Albertsons.

“It gets them at the front of the line for expanding their reach with Grubhub’s reach,” she explained. “It would be easy and understandable for a retailer to try to insist on controlling the full shopping experience — many are — but based on the shifts we’ve seen in consumer behavior, this was a very smart move for all parties.”

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