(Reuters) — As Amazon.com looks to upend the U.S. grocery market with home delivery, some veteran supermarket operators are betting on a different strategy: curbside pickup. Americans have long loved the convenience of drive-through service for burgers and coffee. Kroger Co and Walmart Inc are tweaking that formula for groceries.
The companies have invested heavily in online systems that allow customers to order ahead from their neighborhood store. Workers pick and pack the products, then run them out to shoppers in the parking lot, the grocery version of carry out pizza. For the retailers, the service is cheaper than delivery, because customers do the driving. For shoppers, it means skipping crowds and queues at their local market, and no worries about missing packages or melted ice cream if they are not at home to meet the delivery guy.
Tony Sacco, who lives in the Los Angeles beach community of Playa Del Rey, is a regular user of the service at a nearby Ralphs supermarket, owned by Cincinnati-based Kroger. Each pickup costs $6.95, but the time-crunched married father of three says it is worth it.
“This is easy. Time is money,” said Sacco, 47, as a worker loaded bags into his SUV on a recent morning.
Retaining customers like Sacco is critical for traditional grocery retailers as they battle an array of upstarts bent on turning groceries into the next home-delivery juggernaut.
New entrants such as meal-kit company Blue Apron and organic food seller Thrive Market are peeling off coveted slices of their business. Amazon, the nation’s largest online retailer, has amassed an 18 percent share…