Instacart acquires digital grocery provider Unata

Dive Brief:

• Instacart is acquiring Unata, the fellow e-commerce and digital grocery services provider, according to a press release. The purchase price was not publicly announced.
• Unata will retain its name and Toronto headquarters, and operate as an independent subsidiary of Instacart. Unata CEO Chris Bryson will retain his position and report to Instacart's chief business officer, Nilam Ganenthiran.
• "Instacart's mission has always been to be an independent partner to retailers and enable them to give their customers the best experiences using the best technology," Apoorva Mehta, CEO of Instacart, said in a statement. "This acquisition allows us to take that commitment to the next level. It represents a landmark win for retailers, who will benefit from Instacart's scale, Unata's highly configurable technology, and the deep grocery industry integrations this acquisition will enable."

Dive Insight:

After a year of staggering growth, Instacart deepens its technology and expands into retail services outside of online order fulfillment. Doing so could help the company and the retailers it serves better compete against heavyweights Amazon and Walmart.

Like Instacart, Unata provides an online ordering platform for grocers. It also offers a suite of digital services, including loyalty card integrations, e-circulars and consumer analytics. The Toronto-based company has positioned itself as a one-stop digital solutions provider for independent grocers who want to keep pace with deep-pocketed national chains.

Unata has contracts with regional grocers such as Roche Bros., SpartanNash, Raley's and Lowes Foods that Instacart no doubt also found attractive. Earlier this month, Unata announced a deal with Minnesota specialty chain Lunds & Byerlys to integrate digital coupons with the retailer's existing e-commerce platform.

Unata's broad platform and focus on integrating services with e-commerce could help Instacart add value to its current partnerships. Instacart capitalized on retailers' anxiety over Amazon's Whole Foods acquisition, but it can't count on that same market growth every year. 

According to Diana Sheehan, director of retail insights with Kantar Retail, grocers are looking to not just offer online ordering, but to link loyalty programs, digital promotions, list builders and other capabilities to their platforms.

"Everyone is using different organizing apps, and none of them are talking to each other," she told Food Dive. "That's a miss." 

With Amazon promising to leverage its Prime loyalty program in Whole Foods stores and Walmart offering mobile pay, promotions and other services through its app, the need to add more digital solutions — and to tie them all together — is growing.