Costco widened its same-day delivery network in a single week, adding DoorDash in the U.S. and taking its Uber Eats partnership from 17 states to all 47 where it operates. Nearly 600 Costco warehouses are now on the Uber Eats app, and members can also order from their local store through DoorDash, FreightWaves reported.
The DoorDash launch extends a relationship the two companies already have in Australia, New Zealand, Sweden, Iceland and Puerto Rico. DoorDash now serves eight of the 10 largest food retailers in North America. Uber already lists Costco in Canada, Mexico, Japan, Taiwan, France and Spain.
On Uber Eats, members enter their Costco membership number, shop the full warehouse inventory and choose on-demand or scheduled delivery, according to Digital Commerce 360. The companies also tied their membership programs together: Costco members get 50% off an annual Uber One membership in the first year and 20% off after that, Uber gift cards sell at a discount at Costco, and people who buy a Costco membership through Uber Eats save 30% on their first order.
“We are thrilled to expand our partnership with Costco nationwide, giving Costco members more ways to shop and bringing the brand’s storied selection and value to more consumers,” said Andrew Macdonald, Uber’s president and chief operating officer.
Why Costco wants more partners
Same-day delivery is one of the faster-growing parts of Costco’s business. “Same-day delivery powered by our third-party partners has become a highly effective way to deliver more convenience to our members,” CEO Ron Vachris told investors in May. He said average same-day delivery time in the U.S. is 45 minutes, with a 4.8 out of 5 customer satisfaction rating, and that it is “often our highest spending members who are using the service.” In March, CFO Gary Millerchip said same-day delivery through Instacart, Uber Eats and DoorDash was growing faster than Costco’s overall digital sales, which were up 22.6% from a year earlier.
Instacart remains a major partner and powers Costco’s same-day delivery websites in France and Spain, which launched in January. Adding two more platforms changes the bargaining, said Dominick Miserandino, CEO of the retail executive community RTMNexus.com. “For years, Instacart was the only real game in town for them. By bringing in Uber and DoorDash, Costco forces all three of them to fight over fees and speed,” he told FreightWaves. “It keeps members happy, drives extra sales, and Costco doesn’t have to spend a dime running a delivery network.”
The deals also fit a broader push by restaurant delivery apps into retail. DoorDash, which entered retail delivery in 2022, recently added Skims and Gap, and linked with Shopify over the summer so independent merchants can list their catalogs on its marketplace.
WebProNews is an iEntry Publication