Loblaw expands e-commerce beyond groceries

Loblaw Companies Limited is opening up its e-commerce to third-party sellers. So, in addition to milk, eggs and other grocery staples, shoppers can buy items from participating vendors across such categories as toys, home, kitchen and furniture.

The grocer is launching what is calls its "online marketplace" through the PC Express platform tied to its Loblaws, Real Canadian Superstore, and Atlantic Superstore banners. The grocer says this is the largest product assortment available to Loblaw customers to date, and includes items it hasn't traditionally sold before. The marketplace features brands such as Umbra and Lennox Furniture.

In a press release announcing the expanded product assortment, Hesham Fahmy, vice-president at Loblaw Digital, said the intent of the service was to better support the needs of Canadian families. Products will be easy to purchase through PC Express and can be returned in-store, he said.

"A curated marketplace is based on the idea that, as they shop with us, Canadians will welcome the chance to buy complementary products from complementary brands," said Fahmy. "For example, as new parents prepare for a baby with diapers and formula, they would probably find it very convenient to be able to order blankets, wash cloths or even a crib through us."

Shoppers can opt to pick up orders in-store or have them delivered to their home. They will also earn PC Optimum points.

The new marketplace expands the company's general merchandise offering, which it already sells in store, with complementary goods "that strengthen the core offering and enhance convenience and loyalty," Irene Nattel, an analyst with RBC Dominion Securities Inc., wrote in a note.

RBC doesn't anticipate the marketplace will add a meaningful contribution in the short term, she said, but as the company expands the product assortment and the business matures "the initiative should help drive modest top line and margin growth in time."