Are you looking to build a grocery delivery app like Shipt for your business? Then you have reached the correct place. It’s comforting to have groceries delivered right to your doorstep. Grocery delivery apps were a great help during this pandemic. We owe a debt of gratitude to all those who stayed strong during these difficult times. The hyperlocal business models of these stores also deserve credit for helping them deliver groceries at the right time. 

Coresight Research’s U.S. Online Grocery Survey, 2020 states that “U.S. Online grocery sales increased by 22% in 2019. The high demand for COVID-19 nationwide lockdowns is expected to propel the growth of online grocery sales this year.

Due to the massive increase in demand for groceries, it is essential that you rely on a business grocery delivery app. Online Grocery has evolved to include contactless delivery and cart sharing. It also includes safe delivery. Hyperlocal delivery services with flexible features are also the most important feature of grocery delivery apps. 

Shipt, a steadfast app like it is exactly what the world of grocery delivery apps needs at this moment. In this blog, we will discuss the steps to build a grocery delivery app like Shipt. We will also explore how much does it take for a grocery app to be as successful as Shipt? 

So let’s begin. 

What is Shipt?

Shipt, a mobile app that delivers groceries to your door, is available for download. The app allows the user to receive their online groceries within a day. Shipt is an on-demand grocery delivery app & service in the United States that’s retained by ‘Target Corporation’, headquartered in Birmingham, Alabama. It was purchased by Target Corporation in 2018 for $550 Million. 

Shipt delivers groceries, electronics, and home products. It provides fresh groceries to customers, so they can enjoy on-demand grocery deliveries on time and without hassle. Shipt’s business model is similar to Instacart. Its monthly subscription is $14, while the annual subscription costs $99 — or $8.25 a month.

Market Size of Grocery Delivery Apps Like Shipt

Shipt app, since its launch in 2013, has simplified how groceries are delivered to customers across the USA. Its popularity has grown exponentially. Check out the statistics to get a better idea.

• Has over 200,000 user downloads.
• Profits of $5000 on iOS and Android.
• In 2030, the US online grocery market is expected to generate revenues of $2158.53 Billion.
• Target acquired the platform for $550 Million.
• The company has expanded further and opened 1,000 new stores, reaching 2 million more households.
• It showed a 252% increase in 2021 compared to 2019.

Shipt App- Grocery Delivery App Business Model

In order to build a grocery delivery app like Shipt, you must know its business model. Thus, let’s take a look at the business models and revenue streams.

1. Membership Fees

Users must subscribe to the platform to become a member. For apps like Shipt, this is their primary source of income. Two types of membership are available.

The following are:

• Annual – $99
• Monthly – $10.99
• You can also get free shipping with VISA cards.

2. Delivery & Service Fees

Shipt is an app that delivers groceries instantly. It has delivery partners, also known as “shoppers”, who deliver the goods from the store directly to the customer. The Shipt shopper application accomplishes this. In any case, the user will be charged. This becomes one of the biggest revenue streams for the platform.

3. Commission On Sales

There are a number of grocery stores that have partnered with the Shipt platform. You can find this at a variety of grocery stores.

• Walgreens
• 7-Eleven
• Dagostino
• Dans Fresh Market
• Dicks Market
• Dierbergs
• Weis Markets
• Western Market

They have an agreement to share revenue as aggregators. They generate revenue from this.   

4. Price Markup

This is a very common tactic used by grocery delivery companies to generate revenue. The price of the items is 10%-20% higher on the platform than in the store. The platform keeps all the profits from the increased price. The business model for the Shipt app is to deliver groceries. Let’s now look at how the app for grocery delivery works.

How Does the Shipt App Work?

Users of the Shipt grocery delivery app may order groceries and have them delivered right to their door. Customers browse through a wide selection of items available from local grocery stores and add them to their virtual cart. Once the order is placed and payment is made, a personal shopper from Shipt accepts the order and goes to the store to pick up the items. 

The shopper communicates with the customer throughout the process, providing updates and substitutions if necessary. Finally, the shopper delivers the groceries directly to the customer’s specified address, completing the transaction. 

Shipt offers a convenient and efficient way for users to get their groceries delivered with minimal effort. Moreover, when you build an app like Shipt only for the iOS platform, you need to hire a custom iOS app development company. 

Top Alternatives of Shipt App

With major businesses like Instacart, Peapod, and Amazon Fresh making a name for themselves in this market, on-demand grocery delivery is currently one of the highest-grossing industries. So let’s have a look to build a grocery delivery app like Shipt: 

1. Instacart

Instacart is one of the most popular grocery apps in the USA. It has a wide range of prices and offers fresh groceries with same-day delivery. Instacart has become popular in many cities due to the cost-effective price of delivery. 

Customers can pick up their groceries at selected retail stores, and that too for no additional charge. You only need to schedule a pickup time and place an order. The store owner will then prepare your groceries at the nearest location.

Pricing and Delivery Fees – The size of your order determines how much the shipping price will be. Instacart Express members can get free delivery with a minimum purchase of $35. Delivery prices can be higher during busy shopping periods or during festivals.

2. Peapod

This online storefront delivers groceries directly to your home or business. Ahold Delhaize owns the company, known for managing grocery shops and Landover.

Peapod operates a number of warehouses where it can deliver groceries to customers after they have placed an order. Peapod has partnered with Stop & Shop and other chains to provide groceries in various locations. Customers can also pick up their grocery items from these stores.

Pricing and Delivery Fee -Peopod charges a $10 delivery fee for any item over $30. Delivery charges are reduced from $10 to $8 for orders over $75 and to $7 for orders over $100. Peapod offers customers the option to pick up their groceries for free.

3. FreshDirect

Another grocery delivery app that has gained massive popularity is Fresh Direct. It offers fresh meats, cheeses, and products to its customers. If quality and freshness are important to you, Fresh Direct is the ideal grocery delivery app.

Fresh Direct offers more information on its canned foods, including their origin and quality rating, as well as how they arrived at your door. Thus, if you want to invest in an app like FreshDirect, then you must consult a food & restaurant app development solutions provider. 

Pricing and Delivery Fees – Shipping charges vary depending on where you live and what quality of box you ordered. However, the average delivery fee for a $30 box comes to around $6. Customers can also upgrade to FoodKick, which guarantees expedited delivery for a minimal cost.

4. Postmates

Uber acquired Postmates in 2020. Postmates lists renowned supermarkets like Walgreens where customers can place orders and receive their groceries delivered to their door.

Customers may follow their items in real-time thanks to Postmates’ extensive delivery network. More than 3000 American communities offer Postmates service. It competes primarily with DoorDash, Grubhub, and Uber Eats.

Price and Delivery Fees – Customers who opt for unlimited membership can get free delivery of all orders over $12.

Above are the outstanding on-demand app ideas for growing your online grocery business. So to grow your grocery business, you will need to hire a reputable company that can build your app and give your business a digital presence. 

Grocery Delivery Features That You Should Integrate

In this world of on-demand apps, it is the features that make an application relevant and popular. We will look at the features that an app for instant delivery like Shipt must have. 

1. Push Notification

Push notifications can be a great tool to keep customers informed about your new products and offers. You can send mobile notifications or messages to inform users of the availability of certain products, stock, special offers, time limits, and other information. Misuse of this feature can also lead to users uninstalling the app, as they may be upset by receiving so many notifications. It is therefore important to have an established push notification strategy.

2. Delivery Window

Giving customers more control of the delivery window will make their shopping more profitable and enjoyable. Customers should have the option to select the date and time of delivery. In order to integrate this feature into your app, the first thing you need to do is hire a React native app development company.

3. Voice Search Option

It is much easier for customers to navigate the app and place orders with an AI voice search. It speeds up client requests and makes it easier to find specific items in the app. Additionally, you can integrate this feature when you build a Food & Restaurant Ordering App for your restaurant business. 

4. Cart

The app should allow the user to add items to their virtual cart without leaving a page. This enhances user experience, as the customer can stay on the same page while adding items to the shopping cart. They can add products from a single screen without interruption.

5. Loyalty Program

What would you feel like if your loyalty to an app was rewarded? These loyalty programs give customers the opportunity to receive various gifts and offers that are in their best interest. It also encourages users to purchase more through the app, as each transaction brings them closer to receiving other forms of compensation.

6. Multilingual Option

You should not limit yourself to only serving one network. The addition of multiple languages in the app can help to expand the service globally.

Advanced features you can include in your Grocery Delivery App   

The MVP version can include the features listed above. To stay ahead of the competition, it is important to have features that are smart and can provide a better user experience when you build a grocery delivery app like Shipt. Below are some of the features you can add after the MVP is launched.

1. Sign up with Biometrics

The old methods of enabling logging through social media or signup pages have been replaced. AI-powered biometric fingerprint sensors and facial recognition login are not only more convenient for customers but also a more authentic way to gain their trust in your application.

2. Wishlist and frequently ordered products

The user can save the item they like and add it to their cart for subsequent purchase using a wish list. Another excellent technique to improve the user experience is to use the commonly ordered list. It’s automatically generated based on past purchases and allows the user to avoid having to browse through the entire list.

3. Fast Track Delivery

You may need to buy groceries urgently at times. The customer will be loyal to your app if you offer the option for normal and fast delivery. They can also rely on it in an emergency. This can also be a great way to monetize your app, as customers can pay more for fast delivery. 

4. Recipe Corner

It is important to personalize your application, as this will provide a better customer experience. Long-term benefits of this are also present. A recipe component in the app will encourage repeat users who are looking for new recipes. You can encourage users to purchase the groceries they need by integrating the recipe section into your app.

How to Build a Grocery Delivery App like Shipt?

If you are a grocery delivery startup, you’ll need to hire a development team to implement your plan. The team should include a business analyst, project leader, app developers for iOS and Android, UI/UX Designers, and Quality Assurance Engineers. You can begin the development process after the team is established. This involves the following step to build a grocery delivery app like Skipt.

1. Strategize and plan

You must first have a project plan that is comprehensive and actionable before you build a grocery delivery app like Shipt. Your Grocery Delivery App development company will typically hold product discovery workshops to discuss the following: the target audience, competitor analysis, the pain points of target consumers, app specifications, and budget. A development plan is created after thorough research.

2. Select the Right Platform

An app can be made natively or as a hybrid. Each choice has its own benefits and drawbacks, so think about which is best for your company. If you want iOS or on-demand android app development, then you must know its benefits and drawbacks. 

However, native apps can be expensive to develop and are only available for iOS or Android. Cross-platform apps, on the other hand, are more cost-effective than native apps and can be used across platforms.

3. UI/UX Design

The design of your app is important because it’s the first thing that customers will see. It must be simple and polished. Plan a clear, concise, and user-friendly layout. As you design, consider both the product requirements and your target audience’s challenges.

4. Prototype

Making a prototype is the next stage after perfecting the design. The app’s interface and features are visible. Additionally, you can try out any new features that you intend to add to the app. You can gauge the viability of your app, get feedback from users, and approach investors for funding.

5. Development Phase

During the iterative process, your UI/UX team should then translate everything that they have illustrated into reality. When you build a grocery delivery app like Shipt, the developers will build a Grocery Delivery mobile app with all the functionality that will be tested by the QA team. You should ensure that all features are working as expected and the end product addresses the pain points identified at the initial stage of development.

6. Testing

Quality Assurance Engineers review your grocery application for usability, security compatibility, and performance before the official launch. You will need to hire qualified testers who can help in finding out the errors and bugs present in the app. When the testing of the app is thoroughly done, your app will be ready to go live.

7. Final Launch

Finally, your app will be accessible through Google Play and the Software Store. The launch of your app does not mean that it is ready for changes. Continue to make edits and improvements to your app.

8. Promote and Analyze

Marketing your app is essential to get people to download it. You will need a marketing plan to do this. This segment can be helped by campaigns in marketing, public relations, and social media. Analyzing user behavior and conversion rate will allow you to improve the usability and performance of your software.

9. Maintain

Last but not least, you must continue to support and update your app. Your team’s ability to patch bugs and incorporate new features and functions is crucial.

Cost to Build a Grocery Delivery App Like Shipt

The cost to build a grocery delivery app like Shipt does not always remain the same. It keeps on changing with technological upgradation and some essential variables. Below we have listed some of the factors affecting the cost:  

• App complexity
• App platforms
• The Size of the Development Team
• App Development Region
• Third-Party App Integration

App complexity is determined by the features that you integrate into your app. The more features and complex the design, the higher the cost. 

If you decide to build a grocery delivery app like Shipt for just one platform (iOS or Android), the cost is lower than if it was developed for both. Next, you have to decide on the region where your app will be developed. 

In different regions, the cost to build a shipt app per hour is different. In the USA, you can hire app developers for $150-$250 an hour. Eastern Europe developers charge $100 to $150 per hour. If you decide to have the app developed, then you will pay a lot more per hour. $15-$20 an hour. 

According to this estimate, the cost to build a grocery delivery app like Shipt for a single mobile platform with key features would range between $25000 and $40000 if you decide to hire mobile app developers in Dubai or a company that develops apps on demand. A feature-rich app that works on both platforms will cost you around $50000.

Conclusion

You can see from the statistics in this blog that the demand for on-demand app development like Shipt will continue growing, whether you are in the US, Europe, or Asia. After the pandemic millions of people learned how to save time with grocery delivery. 

There are already dozens of grocery delivery platforms. It is still a viable idea as long as the development team you select has experience and trustworthiness. Shipt is a great grocery delivery platform. Many businesses and startups want to create their own apps, like InstaCart or Shipt.

It’s a great way to make money for your business. Consult experienced mobile app development services in UAE that builds a grocery delivery app like Shipt, if you’re looking to create a market-leading on-demand delivery app, like Shipt. 

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