Ninja hones in on urban grocery delivery

The service is looking to corner the rapidly growing market after it raised $2.8 million in capital.

Fast grocery delivery service Ninja will be doubling down on its commitment to key, high-density Canadian markets after raising $2.8 million in a seed capital.

The service is the first to boast 10 minute delivery for groceries and essentials from its three locations: one in Waterloo and two in Toronto. With the seed capital, it will be adding additional stores in the GTA and Vancouver and attempting to drive trial through marketing and discounts, says CEO Wesley Yue, who adds that there is a “huge green space” in Canada for rapid grocery delivery thanks to a dearth of competition.

“If you look at all of the options that you have available to get groceries today, you can go to a store and buy them, or you can order online through Instacart or a similar service like one of the legacy grocer ecommerce options,” Yue  explains. “But with all of these options, you can’t really get under the 20 to 30 minute range. There’s no way you can get it and have it at your house within 20 minutes. We think that’s where Ninja can come in.”

Driving trial is key to Ninja’s strategy as it attempts to scale rapidly. “People start out by trying it because they’re curious and think [10 minute delivery] sounds impossible. They try it out the first time to test it and, when it happens, throughout the coming weeks they’ll think of more things they can get immediately off of Ninja. We think there is a huge opportunity to continue to convert more grocery shoppers both online and offline to be a Ninja user,” Yue says.

But why is Ninja committing so earnestly to Canada?

“The Canadian grocery market is interesting, especially when you compare it to the U.S., because it’s super concentrated. There’s three or four players that own 60 to 70% of the market. In the U.S., it’s much more fragmented and competitive,” Yue notes. “As a result, the grocery chains in Canada have much better economics than their U.S. counterparts. Typically, their margins are double what their U.S. counterparts are.”

According to the latest insights from Field Agent, 53% of shoppers surveyed use online delivery services to shop for groceries at least some of the time