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Daily news and analysis about the food tech revolution

Kroger

Kroger Taking Flight with Drone Delivery Pilot This Spring

Kroger announced today that it is working with Drone Express, a division of TELEGRID Technologies, to launch a drone delivery pilot starting this spring.

The first test of the new drone delivery will begin this week near the Kroger Marketplace in Centerville, Ohio (just outside of Dayton). Actual customer deliveries are scheduled to begin later this spring with a second pilot launching this summer at a Ralphs in California.

But Kroger isn’t just planning on sending drones to your front yard. In the press announcement, the company indicated that it’s looking to get customers the last minute items they need, wherever that may be. So that could be picnic supplies to a park, or cold drinks at a hot beach. Kroger said that drone deliveries will be limited to a payload of around five pounds and deliveries of eligible orders should arrive within 15 minutes.

When we talk about drone food delivery, it’s usually centered around restaurants. Because drones can reach their destinations so quickly, they are shaping up to be a viable option for hot restaurant meal delivery. But we are starting to see drone delivery gain traction with grocery retailers. In Ireland, Manna has a partnership with Tesco, and here in the U.S., Walmart is working with Flytrex to test out drone deliveries in North Carolina and Rouses Market is using Deuce Drone to trial deliveries in Alabama.

It should also be noted that with this drone trial, Kroger continues to show its tech-forward thinking. So far this year, Kroger has opened the first of its robot-powered customer fulfillment centers, and started piloting more automated checkout via Caper’s smart shopping carts. Plus the fact that Kroger is launching two drone delivery pilots this year shows the company is being more aggressive about aerial delivery than its competitors (at least publicly).

If you are interested in the future of drones delivery, then you must come to ArticulATE, our food automation virtual summit happening on May 18. We’ll have a full panel devoted to drones featuring the CEO of Manna. Get your ticket today!

Kroger Launches a Recycling Program in Partnership With TerraCycle

Grocery retailer Kroger announced today the launch of its Kroger Our Brands Recycling Program, an expansion of an earlier program developed in partnership with TerraCycle. The program aims to make it easier for consumers to recycle flexible plastic packaging. 

Flexible plastic packaging includes things like snack pouches, potato chip bags, packets of cheese, and frozen food pouches, among other items. While this particular type of packaging keeps food fresh, it’s also very difficult to recycle and not eligible for curbside pickup in most parts of the U.S.

TerraCycle, meanwhile, specializes in hard-to-recycle items such as flexible plastics. The company has several different recycling programs in operation, and also runs Loop, which offers common CPGs in reusable containers.

The Kroger/TerraCycle program means customers can sign up for free to ship them to TerraCycle using a prepaid shipping label. Users earn points for every pound of packaging sent. Points can be redeemed as donations to participating charitable organizations.

Having to take the extra steps to separate flexible plastics and actually put them in the mail might deter some customers. However, Kroger said in today’s press release that it saw “great success” with an earlier version of the program, which recycled flexible packaging from the company’s Simple Truth brand. The new program is available to schools, offices, and other organizations, in addition to individual consumers and households. 

All packaging collected through the program will be melted into hard plastic and used to make new products. 

For now, only the following Kroger brands are eligible to be recycled via the program: Private Selection, Kroger Brand, Comforts, Luvsome, and Abound. 

 

Kroger Officially Launches its First Robotic Customer Fulfillment Center

Grocery giant Kroger officially opened the first of its automated Customer Fulfillment Centers today in Monroe, Ohio, just north of Cincinnatti. Kroger had soft-opened the facility at the beginning of March, but today marks it’s official debut.

The Monroe CFC is 375,000 square feet and is powered by Ocado‘s automation technology. The CFC features 1,000 robots scurrying around carrying food items on giant 3D grids, managed by a proprietary air-traffic control system. When an order comes in, the robots assemble the items, which are bagged and placed in a temperature-controlled van and sent out for delivery. The CFC currently services a 90-mile radius from the hub location, though that radius will increase as spokes are set up that can extend that reach.

Kroger first announced its automated CFC initiative back in 2018, well before the pandemic pushed record numbers of people into grocery e-commerce and delivery. The opening of Kroger’s first CFC couldn’t have come at a better time for the company. In a press announcement released today, Kroger said that 2020 saw its e-commerce business scale to more than $10 billion with a record digital sales increase of 116 percent.

Online grocery shopping is predicted to hit $250 billion by 2025, taking up 21.5 percent of total grocery sales. As such, the entire grocery sector has been adapting to this e-commerce shift. Stalwarts like Kroger, Alberstons and Walmart have all invested heavily in automation and order fulfillment. Amazon is building out its own chain of physical grocery stores. And there has been a massive funding spree since the start of the year on grocery related startups.

The Monroe CFC is just the first such facility Kroger is opening. The company says the next CFC to open will be in Groveland, Florida this spring. After that, the company will open CFCs in Atlanta, Georgia; Dallas, Texas; Frederick, Maryland; Phoenix, Arizona; Pleasant Prairie, Wisconsin; Romulus, Michigan; and centers in the Pacific Northwest and West regions.

If you are interested in the future of grocery automation, be sure to attend ArticulATE, our virtual food robotics summit on May 18!

Kroger “Soft Opens” First Ocado-Powered Automated Warehouse

Kroger has “soft opened” the first of its Ocado-powered automated Customer Fulfillment Centers in Monroe, Ohio, Kroger CEO Rodney McMullen said during an earnings call this week.

According to Dayton 24/7, the new facility is 335,000 square feet, costs $55 million and employs 400 people. The new warehouse will use totes on rails to help assemble orders for delivery, pickup and distribution.

The opening comes almost three years after Kroger announced it was upping its investment in and bringing Ocado’s automation technology here to the U.S. In that time, it selected a number of additional sites across the U.S. that will be home to more fulfillment centers.

Grocery e-commerce and the need for more robust fulfillment logistics has exploded over the past year, thanks to the pandemic. As such retailers of all stripes have been investing in more automation to accommodate online grocery shopping. Albertsons has expanded its use of robotic micro-fulfillment and started testing automated curbside pickup kiosks. And Walmart has partnered with three different technology provides to expand its use of automated order fulfillment.

As the Biden administration accelerates the availability of vaccines and the warm weather of spring and summer fast approaches, the question of how much consumer behavior has changed remains. While industry watchers expect there to be a short-term correction in the use of grocery e-commerce, there is a sense that after a year of lockdowns and social distancing, new habits have set in. Online grocery sales are projected to hit $250 billion and take up 21.5 percent of total grocery sales by 2025.

Kroger’s new Customer Fulfillment Center in Monroe is expected to have an official, grand opening launch soon.

Kroger’s Zero Hunger/Zero Waste Foundation Is Taking Applications for Its Innovation Accelerator

Startups, take note. The Kroger Co. Zero Hunger | Zero Waste Foundation (aka, the “Foundation”) is now taking applications for the second cohort of its Innovation Fund. The program, done in partnership with Village Capital, looks for companies developing new technologies, processes, and other solutions that combat food waste.

The Foundation says this could include rescuing and upcycling “imperfect” food. “Upcycled food is the next frontier in recovering and repurposing food that may otherwise go to landfills,” the Foundation said in a statement this week. In this context, upcycling could mean either using discarded food to create new foods (e.g., upcycled cookies), ingredients, or even meal kits. The program also lumps food rescue — selling surplus food to consumers — as part of the upcycling process, too.

Both areas are becoming more popular in the U.S., with companies like Imperfect Foods, Misfits Market, Renewal Mill, and Goodfish leading the way. Imperfect was actually a part of the first cohort for the Innovation Fund, along with Food Forest, mobius, Replate, and others. About 400 startups applied for the first cohort, so we can expect as many if not more vying for a spot in this next installment of the program.

The six-month-long Kroger program includes one week of virtual programming followed by monthly cohort sessions. The entire program runs from late May through November 2021.

A total of 10 startups will be selected from the applicant pool. Selected companies each receive $100,000 in upfront seed grant funding, with the chance for an additional $100,000 grant based on “achievement of identified program milestones.” Virtual workshops that cover investment readiness and technical skill development, and also provides networking opportunities with mentors and potential investors.

Two startups of the chosen 10 will be picked at the end of six months to receive an additional $250,000 in funding.

Applications are open until April 1, 2021.

Kroger Building Ocado-Powered Warehouse in Phoenix, AZ

Kroger announced on Friday that it will build out its next automated customer fulfillment center (CFC) in Phoenix, AZ. This marks Kroger’s first robot-powered warehouse in the U.S. Southwest region.

These CFCs use robotic technology from UK grocery Ocado (which Kroger is an investor in). Online orders are assembled automatically inside the center through a series of totes on rails, and packaged up for delivery.

Kroger announced a few years back that it would build out 20 such warehouses across the U.S., and has since started work on sites in a number of different locations including: Monroe, OH, Groveland, FL, Forest Park, GA, Dallas, TX, and Pleasant Prairie, WI, Frederick, MD, Romulus, MI, as well as the Pacific Northwest, Great Lakes and West Regions. The first Kroger CFC is expected to open in Monroe this year.

Ocado Robotic System For Kroger

Grocery e-commerce, which got a boost last year thanks to the pandemic, is expected to become the new normal for many shoppers. Online grocery is projected to grow over the coming years and take up 21.5 percent of overall grocery sales by 2025.

As such, grocery retailers are building out a variety of automated systems to keep up with that increased demand. While Kroger is building out these centralized delivery warehouses that serve large areas of customers, others are taking a more local approach. Albertsons built out micro-fulfillment centers in the backs of two of its Bay Area stores, and is expanding to more. And Texas grocery chain H-E-B is adding automated micro-fulfillment to a number of its locations.

Kroger’s CFCs are the opposite of “micro” fulfillment. The forthcoming Phoenix facility will be 200,000 sq. ft., and will open 24 months after groundbreaking to support customers across Arizona.

Podcast: The Future Grocery Store

While I may have missed my annual sojourn to sin city for CES this year, I may soon be able to get something akin to walking the Vegas strip just by heading on down to my local grocery store.

That’s because, at least according to The Spoon’s Chris Albrecht, grocery stores will soon resemble the floor of a casino with all the screens that will show up there in the future. Whether it’s smart carts with a touch screen or digital displays up and down the aisles, we can expect lots more digital signage and screens in our lives as shopping becomes more connected and digitized in the future.

And, as I say on this week’s editor podcast, I’m totally on board with more tech in the corner store as long as it includes bread-making robots filling up the aisles with the smell of fresh-baked loaves.

In addition to talking about smart grocery carts this week, we also discuss:

As always, you can check out the Food Tech Show on Spotify, Apple Podcasts or Soundcloud, or just click play below.

Kroger Using Smart Shopping Carts Powered by Caper

With the news last week that grocery giant, Kroger is using Caper’s technology, smart shopping carts are now officially a thing to watch out for.

Winsight Grocery Business broke the news last week that Kroger has quietly started testing its new “KroGo Powered by Caper” smart shopping carts at a store in Kroger’s hometown of Cincinnati, Ohio. The high-tech shopping carts feature a touchscreen, barcode scanner and scale that allow for a more automated checkout process.

Shoppers scan the barcode of items they place inside the cart, which automatically keeps track of everything being purchased (there are safeguards in place is a user tries to put something in without scanning it). Produce and other fresh items are weighed on the built-in scale on the cart. If an item is removed, the user manually deletes it from the running list on the touchscreen. KroGo users have a separate checkout station that communicates with the cart to automatically tally up the total bill shoppers pay.

Interest in this type of automated checkout has accelerated thanks to COVID-19 pandemic. Automated checkout removes the cashier from the grocery shopping experience, eliminating a vector of human-to-human interaction. This is particularly important when it comes to keeping the spread of germs in check, given how many different people a cashier interacts with on a daily basis.

But Caper Co-Founder and CEO, Lindon Gao, told me by phone this week that his company’s smart cart technology got a boost from another source: his competition. “Amazon Dash has really brought this concept more to the market,” Gao said, speaking of Amazon’s own smart cart tech, “It has validated what we have done all along.”

In addition to adapting to new pandemic realities and the shot of validation from Amazon, the retailers Caper are working with also want to enhance the shopper’s experience. And according to Gao, Caper’s built-in touchscreen on the cart does just that.

“The screen is the holy grail,” Gao said. That’s because shoppers don’t need to download an app in order to use the automated checkout. Everything is there on the cart. Additionally, Gao said that people most people don’t shop while looking at their phones, but the on-cart screen travels with them up and down the aisles.

The screen also provides new advertising and promotional real estate for the retailer. A store can advertise specials, upsell companion items (frozen pizza + ice cream!), and push out possible recipes based on what’s in the cart.

Moving automated checkout to the cart can also mean faster adoption by retailers. Other cashierless checkout solutions like those from Grabango and Zippin require stores to be retrofitted with cameras and sensors. That can take time and be costly, especially for larger stores. A retailer adopting smart carts just needs to deploy new carts and don’t require shoppers to download an app to make the automated checkout work.

As such, there are actually quite a few players in the smart cart space. In addition to Caper, Veeve, Storewide Active Intelligence, Tracxpoint, and Imagr, all have various takes on the technology coming to market.

Given all this activity, smart shopping carts are definitely a thing we’ll be watching out for this year.

Ketotarian, Mushrooms and Innovation Among Kroger’s 2021 Food Trend Predictions

Grocery giant, Kroger provided its food trends recap of 2020 and predictions for 2021 over the weekend. And while the list is definitely a PR move, it does provide a little insight into where the retailer thinks food is headed over the coming year.

But before we get into Kroger’s predictions, let’s take a quick look back at what foods trended at the retailer over 2020. Kroger compiled its results from year-over-year sales growth across Kroger’s business including its roughly 2,800 retail stores as well as pickup, delivery and ship. Based on that, these foods were the big winners of 2020:

  • Zero-Calorie Soft Drinks
  • Four-Cheese Mexican Blend Shredded Cheese
  • Flavored Potato Chips (Hot & Spicy, Regional Flavors & Meal-Inspired Varieties)
  • Sauvignon Blanc Wine
  • Heavy Whipping Cream
  • Fresh Burger Patties
  • Artisan Breads & Restaurant-Style Buns
  • Bulk Individual Coffee Pods (96-Count)
  • Party-Size Bags of Variety Chocolate
  • Black Forest Ham

Snacks. Cheese. Wine. Kroger’s list does seem to accurately reflect our collective mood during the pandemic year, when most of us were locking down and not leaving the house. Perhaps what’s more interesting, however, is what’s not on that list: Plant-based foods. Or plants of any kind, really.

This lack of plant-based burgers is in contrast with larger data showing that sales of plant-based meat (Beyond Burgers, Impossible Burgers, etc.) skyrocketed during the pandemic. The animal-based meat supply chain was strained as people panic-shopped, and ethical concerns over meat processing were raised as meat packing facilities became COVID hotspots.

That there were no plant-based foods on Kroger’s list could be a function of the type of shoppers the store gets, or that the growth in plant-based foods wasn’t enough when compared with the other foods. Snack foods, in particular made a comeback during the pandemic as we all tried to find comfort where we could.

Comfort food is actually a trend that Kroger sees continuing into 2021, writing that “Easy-to-prepare comfort foods are on the rise as consumers look to balance convenience and quick preparation times with flavorful meal options.”

While plant-based foods may have been absent from Kroger’s 2020 trends list, the retailer predicts that a “ketotarian” diet will become more popular this year. As Kroger explains, a ketotarian diet is “a plant-based spin on traditional keto guidelines. Consumers can expect to find a growing selection of these plant-based, high-protein foods on grocery shelves in the year ahead.”

While we’re talking about plants, Kroger also predicts that mushrooms will play a bigger role in our diets this year, writing “Consumers should expect to see mushrooms play a starring role in a variety of new products in 2021, including blended plant-based proteins, condiments, spices, seasonings and more.” We’ve actually been watching this mushroom mania play out over the past year here at The Spoon as mushrooms and mycelium kept popping up as the backbone for new types of proteins including cuts of plant-based meat.

One of Kroger’s 2021 predictions is also near and dear to our Spoon hearts: Innovation in the fresh food aisle. Kroger said to look out for in-store hydroponic farms and plant-based coatings like Apeel that extend the shelf-life of produce among the new technologies to look out for.

A trend that Kroger didn’t mention was food-as-medicine, a space which the retailer has been a leader in. We probably shouldn’t tie this list too much into overall business strategy for the company, but it’s noticeable, given everything that is on the list.

Whether or not it’s a PR stunt, Kroger’s predictions actually seem pretty reasonable, though I wish they had predicted a few more robots, especially since they are building out all those automated warehouses.

Tweet at Kroger’s Chefbot to Find Recipes for Ingredients You Have on Hand

The last day before you go back to the grocery store can be a difficult one when you’re trying to make a meal. What you have left in your pantry is often a random assortment of odds and ends that may or may not go together.

To help consumers avoid giving up and getting restaurant delivery, or, much worse, letting those random items go to waste, Kroger launched its new Chefbot today. Found @KrogerChefbot on Twitter, Kroger says this AI-powered tool will help you discover recipes that put those odds-and-ends foods to tasty use.

To use Chefbot, take a picture of three ingredients and tweet @krogerchefbot. The bot replies with what it thinks is in your picture. If it’s correct, it gives you a link to a page with recipes for your ingredients.

With the pandemic still keeping restaurants closed and winter being on its way, chances are good a lot of us will be eating at home a lot more in the coming months. So another easy meal discovery tool could be pretty useful.

However, at least based on my first test this morning, I’m not sure Kroger’s Chefbot is that tool. To give it a spin, I took a pick of tofu, penne pasta and an avocado and tweeted that pic to Chefbot. Maybe it’s first-day jitters, but Chefbot could only identify one item — penne, and that could be because the box had a giant “penne” written on the side. Chefbot also guessed that I had salmon, which… I’m not sure where it got that one as you can see from the picture below.

I thought I had even cheated a little bit by including the barcode and the tofu label.

Since it didn’t recognize my items, I listed them for Chefbot in a follow up tweet. It then sent me to recipe page that said “Sorry, your search for “avocado penne tofu” did not return any results,” so it gave me a bunch of recipes for chicken dinner recipes.

Kroger’s Chefbot is a lot like Whisk’s Cook Magic, though that service uses texts instead of Twitter, and it doesn’t try to identify pictures (it also seems like it might work better).

We are all for tech tools that help people make better meals at home and reduce food waste. But it seems like Kroger’s Chefbot may need to go back to culinary school to make its AI a little smarter.

Kroger Partners With ClusterTruck for In-Store Ghost Kitchens

Grocery mega-retailer Kroger announced today it is launching ghost kitchens at two of its Kroger retail stores. The kitchens will be done in partnership with delivery-only restaurant service ClusterTruck and provide Kroger customers prepared meals free of delivery fees, according to a press release sent to The Spoon.

Kroger and ClusterTruck have been piloting their partnership since 2019. Through it, ClusterTruck sells its restaurant-quality meals via the Kroger Delivery Kitchen website.

To be clear, the ClusterTruck platform is not a tool for selling meals from other restaurants. Rather, ClusterTruck handles the entire meal delivery process, from conceptualizing a menu to ordering the ingredients, cooking the food, and getting meals into customers’ hands. The company also uses its own proprietary tech stack to update menus and process orders and payments. ClusterTruck, which is headquartered in Indianapolis, Ind. and has a sizable presence around the Midwest, brings this end-to-end delivery concept to the Kroger ghost kitchens. The ClusterTruck menu will be available via the Kroger Kitchen Delivery site.

According to today’s press release, the new concept repurposes roughly 1,000 square feet at each store (a typical Kroger store is about 160,000 square feet). This repurposed space will be dedicated to ClusterTruck staff, who will prepare meals for delivery and in-store pickup.

In theory, at least, that means Kroger would not have to rely on third-party delivery services like DoorDash and Postmates for any part of the delivery process for these ghost kitchens. Interestingly, this comes at a time when some of those third-party delivery services are trying to diversify their platform by offering grocery delivery.  

For Kroger’s two new in-store ghost kitchens, one will be located in Indianapolis and the other in Columbus, Ohio. These will follow an on-premises ghost kitchen already open in Fishers, Ind., and one in Dublin, Ohio, which is set to open later this year.

Today’s news is also another piece of evidence that the lines between grocery store and restaurant are overlapping. In addition to the aforementioned third-party delivery services shuttling some grocery orders to customers, Texas-based chain H-E-B recently opened a food hall that delivers restaurant meals, and grocery service Cheetah added restaurant meals to its available offerings. And though the blurring of the lines between restaurants and groceries is a direct result of the pandemic’s closing restaurants and keeping people at home, the trend is unlikely to reverse, even when restaurants can operate at full capacity once more.

One reason for the continued merging of grocery stores and restaurants is the surging popularity of ghost kitchens. Euromonitor recently predicted that the ghost kitchen market will be worth $1 trillion by 2030. That number factors in not just ghost kitchens for restaurants but also spaces for food producers and retailers. The $1 trillion figure may seem a little absurd now, but if more partnerships like the Kroger-ClusterTruck deal emerge, it may soon seem a less outlandish number and more a reality for both the restaurant and grocery industries.

Kroger to Build Out Ocado-Powered Automated Fulfillment Center in Romulus, MI

Grocery giant Kroger announced today that it will be building out its next Ocado-powered robotic fulfillment center in Romulus, MI.

Kroger is an investor in Ocado and uses the U.K.-based company’s technology to create automated fulfillment centers. These centers use a system of totes, rails and robots to assemble and expedite online grocery orders from a central location that are then sent out for delivery. Kroger is in the process of building out 20 of these facilities across the U.S.

In June, Kroger announced that the Great Lakes, Pacific Northwest and West would each get their own fulfillment center. The Romulus facility will service the Great Lakes region. Other locations announced include Frederick, MD, Monroe, OH, and Dallas, TX, among others.

Kroger’s ongoing automated march across the U.S. comes at a time when the pandemic and spurred record amounts of online grocery shopping. Though recent data suggest that the initial surge in online grocery shopping tapered off later in the summer, online grocery shopping sales are projected to hit $250 billion by 2025.

The first of Kroger’s automated warehouses aren’t scheduled to become operational until early 2021. That will give Kroger plenty of time to properly ramp up its own delivery operations amidst growing grocery e-commerce, but it also gives Kroger’s competition time to gain more marketshare. Amazon is expanding its grocery ambitions and offers Prime members free same-day delivery. Walmart just launched its own subscription service that offers free same-day grocery delivery as well. Even more regional players like H-E-B in Texas are getting into the automated grocery fulfillment game.

Kroger’s Romulus facility will be 135,000-square-foot, will create 250 new jobs and open up 18 months after the site breaks ground.