The AI revolution is well and truly ongoing. It is said to bring billions of dollars in savings. Needless to say that companies operating in a cut throat competitive environment will make that move. M&S is not the first nor the last.
The bigger questions indeed are a.) whether or not M&S will actually redeploy the staff to front line store staff roles and b.) whether they will retrain them to provide customers with the right advice and service. I would guess this would be the case only for a minority of employees, considering call center location and fit in terms of personality and skill set.
Cross border selling to China represents more or less the revenue of Kroger company ... definitely sizable enough. Recent Chinese regulation changes no longer give tax exemptions to foreign products so that might curtail some of the sales. There are already several global retailers selling their private branded products through similar platforms into China. It will provide more scale to Kroger's private brand program so definitely a sensible move.
For the growing target demographics Millennials and Generation Zers, this seems indeed like an attractive deal from Kroger compared to Amazon Prime Pantry: free delivery from $35 instead of Amazon's $40; and when below that a delivery fee of $4.99 instead of Amazon's $7.99.
It will be interesting to see if they are able to get enough scale and velocity to make it economically viable. Large retailers such as Kroger simply cannot sit on the sideline. They have to try out and tweak different online fulfillment methods.
A retailer loyalty point system is pretty effective for most type of businesses to keep loyal shoppers from defecting. In addition you look to add in these little surprises or unique "thank you" moments or services: E.g. Japanese leading retailer Aeon not only offers a points reward system, it also allows its gold card members (based on spend and frequency) the option to relax inside their in-store lounge area (read newspapers and get free beverages and snacks) -- a nice way of saying "thank you, you are special" and having them also try some new product samples.