Target has entered the same-day shipping game. It announced last week that it has acquired Shipt, a fast-growing same-day delivery company, for $550 million. This is the latest shot from the retailer to compete against Amazon.
The move is one of the largest acquisitions in Target’s history. The acquisition means same-day delivery of groceries, essentials, home, electronics and other products will be an option at about half of Target stores beginning in early 2018. By the end of 2019, Target will offer same-day delivery on all the major product categories at Target.
Shipt, like its rival Instacart, is a membership-based grocery marketplace and same-day delivery platform that allows customers to place online orders for fresh food and household essential deliveries, such as paper towels or cleaning supplies, from nearby stores. Their fleet of shoppers pick the items and deliver to customers’ doorsteps within the same day. Since its founding 2014, Shipt has expanded to more than 72 markets across the U.S., with plans to expand to over 140 by the end of next year.
There two membership plans – A yearly Shipt membership is $99 per year or the monthly membership for only $14 per month.
Target plans to join the Shipt online marketplace, while Shipt intends to keep serving its other retail partners. Eventually, Target will offer the Shipt same-day delivery service on Target.com and the Target app.