The Kroger Co. has tapped restaurant digital hospitality platform provider Olo Inc. to help manage third-party online delivery orders.
In announcing its fiscal 2022 results this week, New York-based Olo said Kroger has deployed the Olo Rails module to about 1,600 locations to bring sushi and floral delivery to customers nationwide. News of the rollout comes a couple of months after Kroger, the nation’s largest supermarket retailer, announced on-demand delivery of sushi and floral online orders placed through DoorDash.
Kroger couldn’t immediately be reached by Winsight Grocery Business for comment on the Olo deployment.
Part of Olo’s software-as-a-service (SaaS) offering, Rails connects third-party marketplaces to a merchant’s e-commerce platform to facilitate order management. The module enables the synchronization of menus, pricing, location data and item availability between retailer systems and third-party sites, in turn streamlining operations through one integration, according to Olo.
Cincinnati-based Kroger said in mid-December that it launched the new DoorDash service at more than 900 stores serving fresh-made sushi and 1,600-plus stores with floral departments. The rollout followed a pilot of DoorDash sushi and floral delivery in selected markets in the fall. Kroger customers place their sushi and floral/gift orders via DoorDash’s marketplace app or website.
Over the past few years, Kroger has been building out its own e-commerce infrastructure for its Kroger Delivery service. However, the supermarket giant also has worked with third-party delivery providers such as Instacart, DoorDash, Shipt and Uber to ensure broad e-grocery coverage across its geographic footprint.
Used by more than 600 restaurant brands, Olo’s hospitality platform runs millions of orders daily through its on-demand commerce engine and provides a single source to serve customers at all touchpoints, whether direct or third-party, the company said. The solution also allows users to build personalized, omnichannel customer experiences via integrations with over 300 technology partners.
Supermarkets signal an “exciting new vertical” for Olo, CEO and founder Noah Glass told analysts Wednesday in a conference call on fiscal 2022 results.
“For Olo, enabling guests to purchase prepared foods and flowers from multi-unit grocery stores represents an emerging vertical, expanding Olo’s total addressable location count by almost 30,000 locations, representing more than $37 billion in annual foodservice sales,” he said. (Call transcript provided by AlphaSense/FactSet.)
Olo also has recently entered the convenience-store space, Glass noted in a Q&A with analysts.
“Although we always thought restaurants are the first vertical, they’re not the only vertical for what is fundamentally an on-demand e-commerce platform. So we’ve taken what we’ve built initially for restaurants and expanded that in past quarters into the c-store space, to the extent that you have convenience stores operating fresh [food] programs. As a reminder, there are about 55,000 of those around the country,” he explained. “Now we’re seeing expansion into the grocery space, again with fresh food programs, with food that is prepared, meats to order, but also importantly with flowers, with a floral department. I think that’s a good representation of another product category that shares some of the same characteristics as prepared food—it’s highly perishable, made to order just in time. And that’s really what our platform was designed to do, unlike some other traditional e-commerce platforms.”