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This deal is Venmo for groceries. A tech company is filling an obvious hole in an established industry - where in many other countries, the incumbents have been

This deal is Venmo for groceries. A tech company is filling an obvious hole in an established industry - where in many other countries, the incumbents have been flexible enough to do it themselves. Amazon has reached the conclusion British supermarkets reached over a decade ago: The sensible way to run a perishable goods supply chain is through an existing network of grocery stores. While WebVan was crashing and burning, Tesco (biggest supermarket) was building out a home delivery service using their shops as "free" fulfilment centres. Tesco Direct launched so early, their original client wasn't even a website - it was a desktop Windows application! This is another odd market where somehow the US incumbents seem unable to implement an obvious feature that is common in other countries. Eventually a middleman (Instacart for food, Venmo for money transfer) do it for them - and take a cut on the way. I wonder why this happens?

dmix 9y ago
> This is another odd market where somehow the US incumbents seem unable to implement an obvious feature that is common in other countries. What other examples are there? We have had online grocery delivery in Canada called Grocery Gateway [1] for a decade or longer. It's run by our biggest grocery company as well. The business seems to be doing fine but it's still very much niche and most people don't know a lot about it. I assumed the US had a few local companies doing the same there. The difference is that these are not anywhere near the scale of what Amazon could do with groceries at a national country wide scale. Overall I don't think Tesco vs Amazon is a really accurate comparison. It sounds more like all of those people who said "Nokia had smartphones way before Apple! This isn't new." Or comparing a taxi company having a mobile app to book a ride vs Uber. Or Couchsurfing vs Airbnb. Etc, etc. There are tons of examples. There is still a huge amount of potential to replace grocery stores with ecommerce and so far only minor attempts have been made. [1] https://www.grocerygateway.com/store/ https://www.grocerygateway.com/store/
- apeace 9y ago
  IMHO the three biggest challenges have been cost, accuracy, and quality. We have a lot of options for this in NYC: PeaPod by Stop N' Shop, Instacart, Fresh Direct, and Whole Foods has its own delivery service. I've tried them all. I REALLY want to stop going to the grocery store. But with all of them, I've found: * The price is too high to justify it. Walking down the corner to the grocery store is not that big a deal. * You don't always get everything you ask for. They run out of stock of things, or forget things. So you often end up missing that one crucial ingredient. * Sometimes they don't give you the quality you're looking for. Maybe the bananas or avocados are either unripe or too ripe. A couple services ask you the preferred ripeness, but then they don't end up having that so they give you a different ripeness. * Back on the pricing: I personally tend to buy only 2-3 days of food at a time, because I want it to be fresh. If I want baked cod on Friday night, I generally want to buy it Thursday or Friday. But since I'm paying a premium for my delivery, it makes more sense to batch it into bigger orders, which doesn't work for me.
  - jimbokun 9y ago
    You live in NYC, and you still want delivery? I mean, when I lived in Manhattan, the nearest grocery store wasn't much further than my refrigerator. Walking into the store and grabbing the thing you want would have been a lot faster than ordering online and waiting for someone to deliver.
    - benwilber0 9y ago
      Depends how much you value your time. If you want to shop at whole foods or trader joes then you're going to stand in line. Standing in line is one of my least favorite things to do. I would rather pay a delivery fee and have someone else do my shopping and bring it to me while I spend the timing doing something else that I enjoy.
      - jimbokun 9y ago
        Yeah, I was thinking more the little super markets and bodegas on every corner, than whole foods or trader joe's.
        urethrafranklin 9y ago
        Come on that's nowhere near grocery-store quality if they even have fresh foods of any kind.
    - dmix 9y ago
      I lived close to a grocery store downtown, walking distance, but I still used an online grocery service for a significant portion of my groceries. I'd get a monthly delivery of non perishable or large/heavy items such as toilet paper, paper towels, canned food, milk bags (this is Canada), frozen food, juice, pasta, etc, etc. Having to carry large/heavy items without a car was annoying so the service was a great help. Basically I'd walk to the store for fresh meat, deli meat, cheese and fruit/vegetables. Everything else I'd just order online. The great part of the online store is I could reorder the same list without having to pick each one out again, with some small modifications usually, so it saved a bunch of time. It was also cheaper on a frequent basis when using the online service. The grocery stores downtown usually have a premium price on everything.
- meredydd 9y ago
  > What other examples are there? Off the top of my head, so all my counterexamples will be British, but here are a few US tech companies who built missing features for major players - whereas in other countries the major incumbents just built it themselves: * Venmo - real-time money transfer (the UK equivalent is the bank-run Faster Payments Scheme) * Intuit - Self-service tax filing (most UK tax is done for you. If you do have to file, you fill out a straightforward online form ["I earned £___ this year"] and enter your card details. Job done.) * Instacart - Online grocery shopping (a standard service from incumbent supermarkets, eg Tesco/Sainsbury/Waitrose/...) * Apple Pay - Electronic payments more secure than magnetic stripe (most of the world had chip cards ~10yrs ago; the French had them in the 1980s.) I'd say that's a pattern. It's not that the US economy isn't dynamic, it's just...weird.
petra 9y ago
UK is the exception. Looking globally, one gets the impression that grocery delivery is a niche, with pickup being the more popular option.
- breakingcups 9y ago
  In The Netherlands, the majority of the premium grocery stores have started a home-delivery option, probably in no small way helped by the density over here.
wcummings 9y ago
>I wonder why this happens? The UK is a much smaller market, so it could be easier to roll out new products?
- meredydd 9y ago
  I'm don't think "smaller" matters much in this case. Delivering food from nearby shops is inherently local and can be rolled out slowly. "Denser", however, is often a very good answer. Imagine shoving every person from California into New York state, alongside the existing residents - and then shrinking the state a little. That's the size and density of England.
intopieces 9y ago
>This is another odd market where somehow the US incumbents seem unable to implement an obvious feature that is common in other countries. This is not quite correct. Grocery stores have had delivery in large cities for a while. There's even a pretty famous scene in the movie Magnolia (1999) that revolves around it. The US is big, and has a lot of empty space, and has many different markets that are tough to coordinate. It's no surprise then than it has taken a big player like Amazon to offer wall-to-wall coverage of grocery delivery. It still hasn't been proven to be something a sufficient number of Americans even want.

dmix 9y ago

> This is another odd market where somehow the US incumbents seem unable to implement an obvious feature that is common in other countries. What other examples are there? We have had online grocery delivery in Canada called Grocery Gateway [1] for a decade or longer. It's run by our biggest grocery company as well. The business seems to be doing fine but it's still very much niche and most people don't know a lot about it. I assumed the US had a few local companies doing the same there. The difference is that these are not anywhere near the scale of what Amazon could do with groceries at a national country wide scale. Overall I don't think Tesco vs Amazon is a really accurate comparison. It sounds more like all of those people who said "Nokia had smartphones way before Apple! This isn't new." Or comparing a taxi company having a mobile app to book a ride vs Uber. Or Couchsurfing vs Airbnb. Etc, etc. There are tons of examples. There is still a huge amount of potential to replace grocery stores with ecommerce and so far only minor attempts have been made. [1] https://www.grocerygateway.com/store/ https://www.grocerygateway.com/store/

apeace 9y ago
IMHO the three biggest challenges have been cost, accuracy, and quality. We have a lot of options for this in NYC: PeaPod by Stop N' Shop, Instacart, Fresh Direct, and Whole Foods has its own delivery service. I've tried them all. I REALLY want to stop going to the grocery store. But with all of them, I've found: * The price is too high to justify it. Walking down the corner to the grocery store is not that big a deal. * You don't always get everything you ask for. They run out of stock of things, or forget things. So you often end up missing that one crucial ingredient. * Sometimes they don't give you the quality you're looking for. Maybe the bananas or avocados are either unripe or too ripe. A couple services ask you the preferred ripeness, but then they don't end up having that so they give you a different ripeness. * Back on the pricing: I personally tend to buy only 2-3 days of food at a time, because I want it to be fresh. If I want baked cod on Friday night, I generally want to buy it Thursday or Friday. But since I'm paying a premium for my delivery, it makes more sense to batch it into bigger orders, which doesn't work for me.
- jimbokun 9y ago
  You live in NYC, and you still want delivery? I mean, when I lived in Manhattan, the nearest grocery store wasn't much further than my refrigerator. Walking into the store and grabbing the thing you want would have been a lot faster than ordering online and waiting for someone to deliver.
  - benwilber0 9y ago
    Depends how much you value your time. If you want to shop at whole foods or trader joes then you're going to stand in line. Standing in line is one of my least favorite things to do. I would rather pay a delivery fee and have someone else do my shopping and bring it to me while I spend the timing doing something else that I enjoy.
    - jimbokun 9y ago
      Yeah, I was thinking more the little super markets and bodegas on every corner, than whole foods or trader joe's.
      - urethrafranklin 9y ago
        Come on that's nowhere near grocery-store quality if they even have fresh foods of any kind.
  - dmix 9y ago
    I lived close to a grocery store downtown, walking distance, but I still used an online grocery service for a significant portion of my groceries. I'd get a monthly delivery of non perishable or large/heavy items such as toilet paper, paper towels, canned food, milk bags (this is Canada), frozen food, juice, pasta, etc, etc. Having to carry large/heavy items without a car was annoying so the service was a great help. Basically I'd walk to the store for fresh meat, deli meat, cheese and fruit/vegetables. Everything else I'd just order online. The great part of the online store is I could reorder the same list without having to pick each one out again, with some small modifications usually, so it saved a bunch of time. It was also cheaper on a frequent basis when using the online service. The grocery stores downtown usually have a premium price on everything.
meredydd 9y ago
> What other examples are there? Off the top of my head, so all my counterexamples will be British, but here are a few US tech companies who built missing features for major players - whereas in other countries the major incumbents just built it themselves: * Venmo - real-time money transfer (the UK equivalent is the bank-run Faster Payments Scheme) * Intuit - Self-service tax filing (most UK tax is done for you. If you do have to file, you fill out a straightforward online form ["I earned £___ this year"] and enter your card details. Job done.) * Instacart - Online grocery shopping (a standard service from incumbent supermarkets, eg Tesco/Sainsbury/Waitrose/...) * Apple Pay - Electronic payments more secure than magnetic stripe (most of the world had chip cards ~10yrs ago; the French had them in the 1980s.) I'd say that's a pattern. It's not that the US economy isn't dynamic, it's just...weird.

petra 9y ago

UK is the exception. Looking globally, one gets the impression that grocery delivery is a niche, with pickup being the more popular option.

breakingcups 9y ago
In The Netherlands, the majority of the premium grocery stores have started a home-delivery option, probably in no small way helped by the density over here.

wcummings 9y ago

>I wonder why this happens? The UK is a much smaller market, so it could be easier to roll out new products?

meredydd 9y ago
I'm don't think "smaller" matters much in this case. Delivering food from nearby shops is inherently local and can be rolled out slowly. "Denser", however, is often a very good answer. Imagine shoving every person from California into New York state, alongside the existing residents - and then shrinking the state a little. That's the size and density of England.

intopieces 9y ago

>This is another odd market where somehow the US incumbents seem unable to implement an obvious feature that is common in other countries. This is not quite correct. Grocery stores have had delivery in large cities for a while. There's even a pretty famous scene in the movie Magnolia (1999) that revolves around it. The US is big, and has a lot of empty space, and has many different markets that are tough to coordinate. It's no surprise then than it has taken a big player like Amazon to offer wall-to-wall coverage of grocery delivery. It still hasn't been proven to be something a sufficient number of Americans even want.