Kroger quietly shuts down third-party marketplace and shipping service
Kroger quietly discontinued its third-party marketplace and shipping service, Kroger Ship, earlier this year, Modern Retail has learned.
Kroger discontinued the service in March 2025, according to a frequently asked questions page on its website redirecting customers to its pickup and delivery services. The Kroger Ship webpage also now redirects to a page outlining Kroger’s grocery delivery services.
The company did not share why it discontinued the platform, and a spokesperson did not immediately respond to a request for comment.
The grocer launched Kroger Ship as a ship-to-home platform with private-label products and center-aisle groceries in August 2018. Two years later, the retailer announced it had partnered with French e-commerce software developer Mirakl to open Kroger Ship to third-party sellers with 50,000 additional items to start, including natural and organic products, international food, specialty items, housewares, and toys. Mirakl is the same company behind marketplaces for retailers such as Best Buy and Macy’s. The Ship orders were dispatched through mail service or third-party platforms.
“We’re continuing to invest in technology that enables us to expand our digital services to deliver anything, anytime, anywhere,” Jody Kalmbach, Kroger’s group vp of product experience, said in a statement in 2020.
Kantar grocery analyst Ross Cloyd said marketplaces present an array of challenges for grocers compared to, say, big-box retailers. The grocery business is low-margin, focused largely on perishable items, and Kroger’s marketplace relied on external shipping providers.
“Direct-to-consumer worked great [pre]-pandemic, but we’re now in a different time where shoppers are looking for convenience, they’re looking for speed, and they want to have that pickup order [in] two hours or less,” Cloyd said. When adding a marketplace, “It’s difficult to focus and keep making sure that that whole connection or experience for that shopper is a pleasant one, where there’s not any question of, ‘Why is the price different from what’s in store, or from the app?’ that sort of thing,” he added.
March also saw significant leadership changes at the Cincinnati-based grocer. CEO Rodney McMullen’s resignation following a conduct investigation was announced March 3. The next week, Kroger announced a new e-commerce business unit led by chief digital officer Yael Cosset, bringing together the company’s technology and data divisions, as well as its 84.51˚ data platform, financial services business, personal finance business and retail media arm, Kroger Precision Marketing.
The company does not disclose revenue specifically from Kroger Ship.
Kroger announced the service in August 2018 as part of its Restock Kroger initiative. The three-year plan announced in 2017 was focused on developing alternative revenue streams to complement the grocery business. Before Kroger Ship, Kroger launched its Kroger Precision Marketing arm in 2017.
The program continued to expand in 2022 with a partnership with Bed Bath & Beyond prior to that retailer’s closure in 2023, adding bedding, storage and baby furniture from Bed Bath & Beyond and subsidiary Buybuy Baby.
Much of the chatter around Kroger’s decision to close its marketplace picked up after Celia Van Wickel, director of digital commerce for Russell Stover Chocolates, posted about it on LinkedIn over the weekend. (Her profile notes that her posts are not on her employer’s behalf.) Wickel wrote that she saw potential in Kroger’s automated fulfillment centers built in partnership with British tech firm Ocado to be used to support Ship’s fulfillment capabilities for third-party sellers. Three of those facilities in Texas and Florida closed last year, but that doesn’t affect other locations or future developments, Kroger spokesperson April Martin told Grocery Dive at the time. The company announced two more fulfillment centers, in North Carolina and Phoenix, in February.
Shipping is a far smaller business in the grocery sector than delivery or pickup, especially after the pandemic — the share of online grocery sales shipped through FedEx, UPS, USPS and other carriers dropped from 42% to 18% from pre-pandemic to this past March, according to survey results from Brick Meets Click.
“The marketplace model is fundamentally about driving revenue and margin growth — through seller fees and fulfillment services, and ultimately retail media, similar to Amazon and Walmart,” Van Wickel wrote. “Kroger’s regional scale and limited general merchandise assortment may not support a sustainable third-party marketplace — especially if shoppers simply don’t use it.”