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Instacart Launches Self-Serve Ad Platform, Offers Alternative To Google, Amazon 05/27/2020

by Laurie Sullivan @lauriesullivan , 6 hours ago

Instacart quietly debuted its self-service tool for promoted products in search results in its advertising platform on Tuesday as demand for the company’s services continues to climb. Brands and agencies can now buy ads through a self-service platform.

The move toward featured products in search results will enable the online platform to not only compete for ad dollars from grocery brands advertising on ecommerce sites such as Amazon and Walmart, but on Google, Bing and Facebook as well.

Brands can set their own goals and ad budgets and manage bid prices.

As Instacart’s consumer base skyrockets, Procter & Gamble, Unilever and Pepsico, among others, have tested the sponsored ads platform in the past two months, buying media and managing campaigns.

The service is available from about 350 retailers including Costco, Gelson’s, and Kroger -- comprising some 250,000 stores in North America.

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Instacart personalizes search results to ensure that Featured Products serve up based on the perfect search, but the triggers required to view certain results are not clear. The company also offers other Marketplace Ads such as category banner ads, coupons and such delivery promotions as managed partner services.

eMarketer estimates that online U.S. food and beverage sales will increase 23.4% to more than $32 billion by 2021, and a CivicScience study suggests that 22% of U.S. adults participating in the survey rely on food delivery services, up from 19% in early April.

The results are seen in Q1 2020 earnings calls. When Sprouts Farmers Market released its earnings on May 6, the company acknowledged that social distancing changed consumer behavior that led to a “significant surge in e-commerce sales.”

In April, Sprout’s ecommerce sales rose by more than 950% from a year ago across all 344 stores.

“This service in partnership with Instacart utilizes an innovative model with our team members performing the picking and delivery to cars,” said Jack Sinclair, Sprout’s CEO.

Instacart has noted an increase in the number of shoppers using its service rising from 200,000 to 350,000 in the past few months. In March, reports put the reach to more than 85% of U.S. households and 70% of Canadian households.