Target Corp will team up with Instacart in offering same-day delivery of household items and groceries for $3.99 in Minneapolis, as the retailer rolls out its alternative to Amazon.com an online rival that offers $299 per year grocery deliveries.
Target will be the second largest retailer partner of Instacart by revenue. Currently the largest is Costco Wholesale, and it will significantly expand the delivery startup’s inventory positioning itself as an antidote to Amazon for retailers that are brick and mortar.
Even as sales of electronics, clothing and books shift online, some shoppers prefer to shop at supermarkets when it comes to food.
Companies expect grocery sales might move over to the Internet as well, and have started experimenting to find what is the best approach.
Amazon, the largest retailer of e-commerce in the world, has promoted its service of grocery delivery with free trials for 30-days in certain markets.
Google Inc announced last week that it plans to start testing its delivery service for fresh food and groceries later in 2015 in San Francisco as well as one more city.
Instacart works with many retailers that provide stores near customers. The company has the technology to enable orders online as well as employees who can fetch groceries from shelves and has mostly drivers who are contracted to deliver them in private vehicles.
Instacart’s other partners in retail include Whole Foods, Petco and supermarkets in 18 different metropolitan areas including New York, Seattle and Miami.
The partnership with Target announced on Tuesday adds much more inventory to Instacart’s beauty and health items as well as its baby products.
The deal also expands the order options online for customers of Target, who already can receive free delivery within five days on a minimum order of $25.
The deal with Instacart adds perishable items like eggs and milk its options for ordering online as well as faster delivery times, rounding out the offerings of the company for its online shoppers.
The grocery delivery fees will start through Instacart at $3.99.