Following the playbook of some of the most innovative personalities in retail, Albertsons is launching its own subscription service with a key Amazon Prime-style perk.
The program called FreshPass allows subscribers to get unlimited free grocery deliveries, reports Progressive grocer. FreshPass, an optional service added to Albertsons’ existing apps, costs $ 99 per year or $ 12.99 per month. With a subscription, buyers get free shipping for orders of $ 30 or more.
The grocer is offering a 30-day free trial with a five percent discount on some of its private label products and ongoing perks like food and wine experiences to encourage adoption. Albertsons is also introducing two more new digital offerings – a Deals & Delivery app and an improved loyalty program. The loyalty program called Albertsons For U will automatically include members of the grocer’s previous program.
The cost of the Albertsons FreshPass program is roughly the same as the new one from Walmart Walmart + Subscription service (which offers unlimited free shipping and various other perks) and about $ 20 cheaper per year than Amazon Prime.
Even before the novel coronavirus pandemic, surveys showed that a majority of customers preferred free and fast shipping for e-commerce orders. The dramatic increase in the use of grocery delivery since the beginning of the pandemic has caused grocers to compete to provide such services to a greater extent than ever before.
However, some of the biggest names in retail are starting to pay customers extra for the privilege of fast delivery in some cases. Amazon recently announced that Whole Foods’ grocery delivery, which was previously free with Amazon Prime membership, costs an additional $ 9.95 in some pilot markets.
Albertsons, once regarded as a latecomer among grocers, has improved and redesigned its operations in recent years. The chain has piloted micro-fulfillment centers for online orders, in-store robots, automated grocery pick-up kiosks, and other new omnichannel technologies.
The grocer too went public in June 2020 and finally completes its IPO after several failed attempts.
DISCUSSION QUESTIONS: Will a membership program with unlimited free delivery work for Albertsons and its existing customers? What does Albertsons need to do to differentiate its offering from other providers of similar subscription services?
“Albertson’s ‘Prime-like’ subscription program is a must to keep the banner competitive.”