Shipt increases authorisation by 6.6% through Stripe’s payment optimisations

Shipt was founded in Alabama in 2014 as a local grocery delivery service, and has since expanded to 260+ cities. Through a user-friendly app and a local network of reliable shoppers, Shipt connects members to fresh groceries and everyday essentials. By partnering with Stripe, Shipt was able to scale to nationwide disruption while providing convenient payments and services to customers, shoppers and communities alike. It was acquired by Target in 2017.

Products used

    Data Pipeline
    Revenue Recognition
North America


Shipt knew from the start that it needed a payments partner that would help navigate the complexities of dual-sided marketplace transactions, offer new features to its shopper community, and streamline operations. Shipt was growing quickly, and knew business objectives would change in the future, and needed to operate on payments infrastructure that was developer-friendly and easily scalable.


Shipt selected Stripe as its exclusive payment processor to help Shipt scale into new markets while offering a full suite of products to enhance the marketplace commerce. “Stripe was the total package. We valued its ease of use and strong engineering partnership,” said Shipt’s Payments PM.

Supported by Stripe Payments and Billing, Shipt saw a 6.6% increase in payment acceptance rates, allowing Shipt to deliver a frictionless customer experience while maximising revenue.

Shipt chose to use Stripe Connect and Stripe Instant Payouts to roll out flexible shopper payouts, called Instant Pay, as an alternative to weekly ACH payments. The adoption rate from shoppers was astounding: within the first weeks of launching Shipt Instant Pay, 30% of shoppers switched and more continue to use the feature every day.


Shipt achieved these impressive results by implementing Payments, Connect, Radar, Sigma, Instant Payouts, and Billing, integrating easily by working across Stripe’s single, connected platform.

Optimising customer credit card acceptance rates

Shipt uses Stripe Payments’ pre-processing layer to prevent declines before they happen. Stripe's Adaptive Acceptance uses machine learning to optimise authorisation messages and make smarter retry decisions instantly.

When the time comes to renew a member’s annual subscription, Stripe Billing helps Shipt update customer payment details and optimise recurring payments. With Card Account Updater, rather than asking customers to manually update information on saved cards that have expired or been replaced, Stripe’s direct connection with card networks allows for updating of cards without service interruption, avoiding customer churn and lost revenue.

The Smart Retries feature of Stripe Billing helps Shipt retry failed subscription charges at the optimal time. Powered by machine learning, Smart Retries uses hundreds of purchaser and transaction signals to choose the best moment to retry to capture a successful payment.

Launching Instant Pay for flexible payouts

To provide shoppers with a more flexible payout feature, Shipt chose to use Stripe Connect and Instant Payouts to launch Shipt’s Instant Pay. With Shipt Instant Pay, Shipt’s 300,000 shoppers can transfer available funds to their bank account on demand instead of waiting for a weekly payday.

Thanks to Stripe’s easy documentation, the Instant Pay implementation was completed almost entirely by a single engineer.
Creating a new order payment flow to reduce network costs
When customers tip, it’s treated as a separate credit card transaction and thereby incurs extra fees. Shipt partnered with Stripe to take advantage of a payment authorization flow, giving Shipt time to finalise any basket order changes before settling the final charged amount in a single transaction.

A partner for the long term

Shipt has “grown up” on Stripe; not only has Shipt been able to seamlessly grow and scale on the same payments provider, but Stripe has acted as a consultative partner to build new product features, optimise revenue performance, and uncover cost savings opportunities.

“The value we get from our suite of Stripe products is greater than the sum of its parts. Stripe's product innovation is impressive and the great partnership supports easy integration. Working with a single team that supports multiple parts of our business simplifies things and allows us to leverage shared learning on new projects.” – Shipt’s Payments PM

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