Kroger, Bed Bath & Beyond Form New Alliance

The nation’s leading grocer and its top home goods retailer have formed a unique partnership that adds value to Kroger’s online offering and gives Bed Beth & Beyond access to a huge new base of customers.

The companies revealed a strategic collaboration to directly offer Kroger customers an “extensive selection” of the most sought-after goods for the home and baby products carried by Bed Bath & Beyond through Kroger.com, as well as a small-scale physical-store pilot at select Kroger Co. stores, beginning in 2022. The e-commerce venture will be enabled by Kroger's Ship marketplace, which was launched in 2018 and expanded last fall.

The companies said that the multicategory omnichannel collaboration will include popular items from categories such as bedding, storage, and baby furniture and gear, and will feature national brands and own-brand products from Bed Bath & Beyond and its buybuy Baby concept.

The companies didn't quantify the breadth of the assortment or the number of stores in which the small-scale pilot will be executed. Despite the lack of specifics, the move is consistent with Kroger’s aspiration to be a leader in fresh food and innovation while fulfilling a larger strategic vision of providing customers with “anything, anytime, anywhere,” according to Rodney McMullen, Kroger’s chairman and CEO.

"Every day, we look for new and differentiated ways and experiences to meet our customers' evolving needs and elevate and celebrate the moments that matter most to our customers,” McMullen said. “As an illustration, Bed Bath & Beyond has a compelling portfolio of products that complement the items our customers already love to shop. This strategic online collaboration and in-store pilot will provide Kroger shoppers easy access to essential home and baby products alongside their favorite grocery staples.”

Stuart Aitken, Kroger’s SVP, chief merchant and marketing officer, said that the collaboration will bring Bed Bath & Beyond and buybuy Baby products to e-commerce and in-store experiences, expanding the ways that Kroger helps people celebrate life’s special moments.

“Now, when visiting a family member's new home, loved ones can surprise them with a meal and a new set of dishes to serve it on in one convenient shopping experience," Aitken observed.

The deal offers benefits to Bed Bath & Beyond as well, given that the company is embarking on the second year of a three-year transformation strategy under the leadership of CEO Mark Tritton, the former head merchant at Target who assumed leadership of Bed Bath & beyond two years ago.

"Our collaboration with an exceptional retailer like Kroger underscores Bed Bath & Beyond's authority in the home and baby categories," Tritton said. "Our product assortment, combined with Kroger's customer base, will present extensive opportunities for current and future customers."

The move by Bed Bath & Beyond was part of a larger series of changes involving the launch of a digital marketplace and a personnel restructuring. The introduction of a marketplace will expand Bed Bath & Beyond’s assortment of key products from a highly curated selection of third-party brand partners that will be seamlessly integrated into the retailer’s digital platform, according to the company.

The introduction of the marketplace and the Kroger deal prompted the home goods retailer to realign its organizational infrastructure and refresh its leadership team to support “its stronger business model.”

The Union, N.J.-based company named Anu Gupta chief growth officer, a newly created role, after her previous stint as chief strategy and transformation officer after joining the company from Target last September.

“As an instrumental driver of our new Kroger collaboration, Anu’s impressive background and business acumen, visionary ideas and successful tracking of our transformation management will help lead our team into the future,” Tritton said.

Rafeh Masood, the company’s current chief digital officer and interim chief brand officer, was named chief customer officer, also a newly created role. John Hartmann, Bed Bath & Beyond’s COO and president of buybuy Baby, will be responsible for partnership execution, in addition to his leadership across IT and supply chain.

Serving 60 million households annually nationwide through a digital shopping experience and almost 2,800 retail food stores under a variety of banner names, Cincinnati-based Kroger is No. 3 on The PG 100, Progressive Grocer’s 2021 list of the top food and consumables retailers in North America, while Minneapolis-based  Target is No. 6 on PG's list.