Funds continue to pour in for online grocery, with vendors that significantly differentiate themselves from competitors in the congested space standing out in particular.
On Monday, Feb. 28, for example, online grocer Weee, which specializes in delivering ethnically diverse groceries, announced that it had raised $425 million in its Series E funding round.
The Fremont, Calif.-based eGrocer, which specializes in items from Asian and Hispanic cultures with plans to add more ethnicities in the future, has raised more than $800 million in total with this latest haul. The round was led by SoftBank Vision Fund 2, with Lydia Jett, managing partner at Softbank Investment Advisors, joining the grocer’s board.
“We saw tremendous growth in 2021, even with the easing of COVID-19 pressures, as our customers continue to discover affordable access to a wide range of exciting products and foods online,” Larry Liu, founder and CEO of Weee, said in a statement. “We look forward to building on this momentum as we deepen our investor base through Softbank’s global e-commerce expertise.”
This isn’t the company’s first massive raise. Almost a year ago, in March 2021, the grocer announced a $315 million fundraising round in its DST Global-led Series D.
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As online grocery options expand, some predict that services will need to specialize to differentiate themselves, as Weee has done by focusing on products from specific cultures.
“[In five years], each market will be divided between three, maximum four, players… Each player should occupy a certain niche,” predicted Maxim Avtukhov, head of international markets at Yango Deli, the 15-minute grocery delivery arm of the Russian grocery giant. Yandex technology. to PYMNTS in an interview. “Either it’s the indulgence, or the focus on fresh and local, or a wider assortment and more affordable offering… It’s not like in the offline world, where you have very many offline retail chains that can be simultaneous players in the market. It would be, I would say, a more consolidated segment.
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Indeed, this differentiation has been a key motivation for SoftBank.
“The ethnic grocery and food market is massively underserved in the United States, and we think Weee! is in a prime position to respond to customer demands,” Jett said in a statement.
According to data from the PYMNTS Decoding Customer Affinity: The Customer Loyalty to Merchants Survey 2022, conducted in collaboration with Toshiba Global Business Solutions. The report, which featured the results of a late fall survey of a balanced panel of more than 2,000 U.S. consumers, also found that one in five shoppers say product delivery options would improve his loyalty to his grocer.
Get the full report: Decoding Consumer Affinity: The 2022 Merchant Customer Loyalty Survey