Instacart: A new model for home grocery delivery?
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Instacart offers a novel twist on handling the last mile of home delivery for grocery products: Use a single cart to order online from three stores – Safeway, Trader Joe’s and Whole Foods – and get a single home delivery within three hours. There’s a $10 minimum per grocer and a $3.99 delivery fee (unless you go for the Prime-style $99/year unlimited delivery offer).
Instacart is not affiliated with any of the grocers; instead, it describes itself as a software company that connects customers with personal shoppers. Items are marked up “a touch,” they say. Enough Bay Area residents are finding value (no fighting traffic, finding parking, or standing in lines) to result in a successful launch for this third-party distribution service.
If it gives shoppers access to products they want and a value they like, then Instacart may just have found a model that will work - at least in areas where there are enough folks who will use it. Alex Wilhem blogs about his Instacart ordering experience and the company’s addition of Whole Foods to the line-up at The Next Web.
Check out our more recent posts on Instacart:
- Instacart's pricing pivot raises 3 questions - Jan 27, 2015
- Taking Amazon Fresh, Instacart and Safeway on a test drive - Jan 5, 2015
- Instacart and the demand for on-demand food - Aug 5, 2014
- Instacart Q & A: Expanding access to online grocery - Jan 7, 2014
- Bill Bishop's NPR interview on AmazonFresh expansion - June 5, 2013
Comments
Peapod's new fixed location will-call centers offer greater time flexibility than a home delivery time window. Wonder if Peapod will experiment with offering the use of its will-call centers to other retailers?
As for Instacart quite an interesting development. A bit niche-ie as long as it is tied to delivery and specific grocers, but it begins to get at the dirty little secret in grocery which is that no store satisfys all of my consumable needs!
The emergence of Instacart shows we still have a ways to go before we come up with a system with the capability to provide everything reasonable that shoppers want and that has a viable business model.