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as an engineer at instacart, it's very disheartening for me to see the top-rated comment on HN is "I can’t wait for instacart to go out of business." even if w

as an engineer at instacart, it's very disheartening for me to see the top-rated comment on HN is "I can’t wait for instacart to go out of business." even if we did not provide value to you (which i apologize for -- it is a priority of ours to improve the replacement experience in particular as it is very frustrating to customers), i am not sure why that implies that we do not provide a valuable service for others and why you would wish ill on us. perhaps it is because you think of us as an overall unscrupulous company ("shady fees", "mark up everything you buy"), which i would contest -- we strive for transparency when possible (see [1] for screenshots around how we describe the pricing of our service). but the larger point remains -- why do you think that there can only be one victor here, and that is has to be amazon? (or "amazing" as you put it). right now, amazon is very explicitly coming for the grocery industry -- an $800+ billion industry that is almost 100% offline -- and we are attempting to be one of the (hopefully many) independent companies that enables it online. grocery companies have built amazing fulfillment pipelines and relationships with both farms & customers that we are building a front-end and logistics system for. anyways, i do not speak for instacart as a company, just for myself as an employee who usually enjoys HN. [1] https://imgur.com/a/j47ls https://imgur.com/a/j47ls

kayhi 9y ago
Never used Instacart, but your link to show transparency, doesn't actually state what the mark up is.. 2%, 10%, 25%, order minimum or there's fee.. Transparency to me, would mean I place order and know how much it will cost, instacart mark up, service fees and if a tip is included.
- octernion 9y ago
  we used to provide specific percentages, but phased that out over time as it was obvious that wasn't providing real value -- where on amazon.com do you see their markup? additionally, for virtually all stores on instacart.com now, we are simply passing on the pricing that the retailer has given us (which may or not be marked up from their internal prices -- but we do not control) edit: to be crystal clear, that means that you are getting exactly what you are asking for -- the prices are simply what the retailer sets (which may be marked up from in-store -- that's their prerogative), and then we show our fees on top of that on checkout. we aren't "hiding" anything, and it's your decision whether the fees are worth your time.
  - deleted 9y ago
    [deleted]
  - kayhi 9y ago
    My concern is the price of getting the product at the store verse instacart delivering it. If you can get a discount directly from the store, great! You are providing value to them.
    - gehwartzen 9y ago
      I agree. There are really only three things I can imagine caring about: 1) Receiving the exact items I ordered. 2) The time it takes to show up at my door. 3) The total price beyond what it would cost me in the store. I know what I pay at the store, I know the value of my time, and I know the cost of driving my car. All I need from Instacart is the total cost for the service presented as simply as possible.
  - alexbeloi 9y ago
    >additionally, for virtually all stores on instacart.com now, we are simply passing on the pricing that the retailer has given us (which may or not be marked up from their internal prices -- but we do not control) IC is responsible for signing the contracts they have with retailers, IC is also the most visible partner for the end-user. As you can see from this thread, attempts to kick the blame down(up?) the supply chain will only fall on deaf ears.
  - heifer2822 9y ago
    I don't think it's comparable to Amazon's mark-up. The alternative to Amazon is walmart.com, ebay.com, etc., all of which can be directly compared. Instacart provides a delivery service. It's comparable to Uber Eats or Eat24. I agree with the others that it seems shady to provide a delivery service but obfuscate how much you're charging for delivery. I know Uber Eats bans restaurants from marking up orders placed through them. You can look at your phone and decide exactly how much extra the delivery costs and then decide if it's worth it to not have to go pick up the food yourself. I've never used instacart but if you're telling me that the price of the service is a secret from me I have a problem would that and would not use it. I don't want to pay $50 to have someone pick up my groceries. But I'd gladly pay $10 on certain days. But I have to know beforehand. I'm not going to sit around and hope Instacart doesn't screw me over today.
rmaus 9y ago
I don't have stake in this one way or the other, but will you argue in favor of Instacart's '$10 service fee' (as mentioned by parent commenter)?
- octernion 9y ago
  i am not entirely sure what they mean by that. the service fee goes 100% towards the shopper fleet and is an essential part of a reasonable compensation structure for all of our shoppers -- if we switched entirely to tips, the folks that (e.g.) actually picked out your groceries, checked out & staged your groceries at the store, would not be compensated. this is because tips have to go 100% to one person, which would only be the delivery person -- and in our case, any one order is handled by many people to be efficient.
  - colmvp 9y ago
    I suppose OP's point wasn't that a service fee wasn't justifiable, just that it's a bit odd to make it optional and have it auto-selected, though given someone else's comment it seems like now it's mandatory.
    - octernion 9y ago
      i know there has been a lot of changes with that recently -- i agree also that is odd. there are a ton of legal nuances here that i do not want to get into, but suffice to say we want to be clear and transparent to customers while at the same time providing a compelling wage to all the folks who touch your order during any part of the lifecycle.
      - mikeklaas 9y ago
        It is really hard to believe that instacart wants to be clear and transparent as possible (although I'm sure you do, personally). If "service fee" was renamed "instacart fee", people would no longer assume it is the driver's tip. But instacart would never do that, would they?
  - 9y ago
petra 9y ago
>> why do you think that there can only be one victor here, and that is has to be amazon? Historically, online businesses have 1/2 winners that "take all". That's assuming the winners could build a warehouse near each city. seems possible. So the question who will be the one besides Amazon? From one point of view. Walmart will likely win in the low-cost grocery pickup business. And on top of that they will do deliveries. The way Walmart will choose that delivery is: is it cheaper than delivery costs for Walmart(for chilled deliveries)? and can it scale ? . Does instacart fit ? it seems not. So it's hard to see how instacart wins.
- octernion 9y ago
  groceries are unlike pretty much every other online segment, which is why it has resisted being moved online (until very recently). the model of having a warehouse simply "near" a city is a model amazon has tried for 10+ years without success -- you must have many warehouses within the city to make it work. i am not entirely clear how you arrived at "Does instacart fit ? it seems not.", so it would be good to understand that. we have spent 5 years with hundreds of engineers building a fulfillment/logistics network just for groceries that any grocer can just leverage off the shelf.
  - ssharp 9y ago
    I think he's saying a customer will ask "is Instacart cheaper than Walmart" and the answer is "no", so there isn't a place for Instacart to fit, assuming Amazon owns the high-end side with Whole Foods (although I wouldn't assume Amazon would settle for just that). Walmart already has grocery warehouses with their stores, so bolting on pickup/delivery to those makes sense. I don't know how much pickup/delivery could potentially negate the need for the store, but I'd assume the pickup/delivery load of a store has huge room for growth before you start questioning why the store needs to be open to the public. I haven't used their grocery delivery service but their pickup service is well-executed and convenient, in my experience, so I'm assuming they can figure out how to be competent in delivery as well.
    - octernion 9y ago
trs80 9y ago
Isn't it illegal to offer a "store credit" instead of a refund in cases where IC forgot my items and I paid debit? Seems like a really shady way to bring customers back. Don't get me wrong, I enjoy the whole concept of online ordering but the IC UI forces users into choices that benefit IC by default.
- FireBeyond 9y ago
  I believe when the refund is not the customer's fault (though some choose to do it then), that the refund is typically "by the medium paid" (with some waiting, or such, for things like uncleared checks, etc.), but I'm not sure if that's a product of merchant regulation, consumer law or 'policy'.
cmclaughlin 9y ago
Overall I really like Instacart and quite frankly, I've come to depend on it. Shopping with kids is difficult... it's much easier to plan ahead and shop when I have a little free time. So congrats on the funding! I understand some of the frustrations about replacements. Originally the shoppers were pretty good about calling. Recently the app was updated for 1-1 chat and interactive replacement choices. However, it seems the shoppers are to busy to use the feature... I've had a few notifications for replacements, only to click on it and find the shopper has already checked out. Personally, I accept that limitation of the platform and make sure I choice "no replacement" if there's any chance I'll be disappointed.
- octernion 9y ago
  thank you for the kind feedback -- we love to hear from customers who we help like this! and, we are constantly trying to improve the experience (especially the replacement experience!)
tfehring 9y ago
Saying “we charge markups, but we won’t tell you what they are” is still not sufficiently transparent, in my opinion. Yes, Amazon and grocery stores do the same thing (at face value, anyway) by not disclosing their COGS. But the key difference is that my next-best alternative to Instacart is to just go to the grocery store myself. My next-best alternative to getting something delivered from Amazon isn’t to get it more cheaply from a brick-and-mortar Amazon store, or to buy it directly from their suppliers - it’s to get it from a different retailer entirely, and I can trivially compare all-in prices between other retailers and Amazon. So I can easily assess whether it makes sense from a cost/benefit perspective to buy something on Amazon, but I can’t make the same assessment for Instacart. I do think the service creates value. But I still hope that, at the very least, it soon faces enough competition that it’s at least forced to be fully transparent about the cost of its service. I want to see one number - the difference between what an order of groceries costs me on Instacart all-in, and what it would cost me to go to the grocery store and purchase the same items myself. As long as I can’t trivially find or calculate that number, I won’t use Instacart again.
- octernion 9y ago
  i am very confused why you have a higher bar for this than other services. would you actually create a spreadsheet that values your time (against other alternatives), gas/lyft/train fare to and back from the store, the extra costs associated with actually being in a retailer (and seeing the specials in store etc) and compare that against our offering? and again, we aren't the ones doing the markup -- those are coming from the retailer directly, who may (or may not) mark up prices, which is their prerogative. we put all of our costs in the checkout screen transparently.
  - tomnipotent 9y ago
    >> and again, we aren't the ones doing the markup So you claim, but since you refuse to list what the IC markup is then it's impossible for us to tell. You're essentially using the retailer markup as an excuse to hide instances of when you do it yourself. Thus the lack of transparency. In any given transaction, I have NO idea what the actual % that was added by IC. I do not have this problem with Amazon Prime.
abawany 9y ago
My experience with Instacart has been pretty great so I was shocked at the GP vitriol as well. In my case, Instacart has been a huge help - my brother, who is unable to drive for medical reasons, uses your service considerably to get his weekly groceries. Once I figured out the substitutes scheme, it worked like a charm.
Density 9y ago
I appreciate you as an engineer, and to weigh in against an Amazon troll, but like please keep hn neutral
- octernion 9y ago
  i am not entirely sure what you mean by this -- sorry. i was not trying to be divisive and offer a personal perspective as an engineer. can you clarify please?
bm1362 9y ago
There are a subset of users on HN that can be hyperbolic. I've worked at a few well known companies and every time they come up here you get some vocal minority outraged about the product/pricing/culture/tech/anecdotal experience etc. I think it's truly toxic (yet entertaining) and definitely deflating as an employee. There is a lack of empathy for other people, companies and a deep inability to disconnect the two. I've noticed a hyper-rationalism here that reduces every company and product into the sum of it's parts and deems it outrageous- which to me comes across as unhealthy (reminds me of going to lunch with an engineering team that optimizes the route, their orders, seating, etc). Congrats on the raise and good luck with everything.
clay_the_ripper 9y ago
You’re right, this was a bit harsh. I’m sure lots of good people work at instacart, and this was not intended to seem like I’m excited for anyone to lose their job. I guess a more accurate statement would be “now that I’ve discovered amazon prime now is available in my area, I’m excited for the competition between these services to offer me a better quality product at a better price”. Sorry if I offended. Cheers.
- octernion 9y ago
  just saw this -- no worries, and thank you for your response. i think that is very reasonable and we are excited to go head-to-head with amazon on all fronts (delivery experience, quality of jobs offered, retail offerings/selection/etc).
itronitron 9y ago
In order for instacart to survive, it needs to partner with regional grocery chains by providing them with the 'ecommerce' side while the grocery chains provide delivery. I live in a metro area where a local chain now provides excellent delivery service (and the employed delivery people won't accept tips) and hope they succeed long term. I don't use Amazon for groceries although it might be available, and I never shop at Whole Foods because their stores are way too large. Whole Foods would dominate if they roll out 'whole foods Express' stores which would be much smaller (think 7-11) so that people can get in and out without feeling like they are walking through the Natural History Museum. Families buy the most groceries and are the most time constrained, but I'll never use instacart until they drop the whole gig-economy frontline workers as contractors bullshit.

kayhi 9y ago

Never used Instacart, but your link to show transparency, doesn't actually state what the mark up is.. 2%, 10%, 25%, order minimum or there's fee.. Transparency to me, would mean I place order and know how much it will cost, instacart mark up, service fees and if a tip is included.

octernion 9y ago
we used to provide specific percentages, but phased that out over time as it was obvious that wasn't providing real value -- where on amazon.com do you see their markup? additionally, for virtually all stores on instacart.com now, we are simply passing on the pricing that the retailer has given us (which may or not be marked up from their internal prices -- but we do not control) edit: to be crystal clear, that means that you are getting exactly what you are asking for -- the prices are simply what the retailer sets (which may be marked up from in-store -- that's their prerogative), and then we show our fees on top of that on checkout. we aren't "hiding" anything, and it's your decision whether the fees are worth your time.
- deleted 9y ago
  [deleted]
- kayhi 9y ago
  My concern is the price of getting the product at the store verse instacart delivering it. If you can get a discount directly from the store, great! You are providing value to them.
  - gehwartzen 9y ago
    I agree. There are really only three things I can imagine caring about: 1) Receiving the exact items I ordered. 2) The time it takes to show up at my door. 3) The total price beyond what it would cost me in the store. I know what I pay at the store, I know the value of my time, and I know the cost of driving my car. All I need from Instacart is the total cost for the service presented as simply as possible.
- alexbeloi 9y ago
  >additionally, for virtually all stores on instacart.com now, we are simply passing on the pricing that the retailer has given us (which may or not be marked up from their internal prices -- but we do not control) IC is responsible for signing the contracts they have with retailers, IC is also the most visible partner for the end-user. As you can see from this thread, attempts to kick the blame down(up?) the supply chain will only fall on deaf ears.
- heifer2822 9y ago
  I don't think it's comparable to Amazon's mark-up. The alternative to Amazon is walmart.com, ebay.com, etc., all of which can be directly compared. Instacart provides a delivery service. It's comparable to Uber Eats or Eat24. I agree with the others that it seems shady to provide a delivery service but obfuscate how much you're charging for delivery. I know Uber Eats bans restaurants from marking up orders placed through them. You can look at your phone and decide exactly how much extra the delivery costs and then decide if it's worth it to not have to go pick up the food yourself. I've never used instacart but if you're telling me that the price of the service is a secret from me I have a problem would that and would not use it. I don't want to pay $50 to have someone pick up my groceries. But I'd gladly pay $10 on certain days. But I have to know beforehand. I'm not going to sit around and hope Instacart doesn't screw me over today.

rmaus 9y ago

I don't have stake in this one way or the other, but will you argue in favor of Instacart's '$10 service fee' (as mentioned by parent commenter)?

octernion 9y ago
i am not entirely sure what they mean by that. the service fee goes 100% towards the shopper fleet and is an essential part of a reasonable compensation structure for all of our shoppers -- if we switched entirely to tips, the folks that (e.g.) actually picked out your groceries, checked out & staged your groceries at the store, would not be compensated. this is because tips have to go 100% to one person, which would only be the delivery person -- and in our case, any one order is handled by many people to be efficient.
- colmvp 9y ago
  I suppose OP's point wasn't that a service fee wasn't justifiable, just that it's a bit odd to make it optional and have it auto-selected, though given someone else's comment it seems like now it's mandatory.
  - octernion 9y ago
    i know there has been a lot of changes with that recently -- i agree also that is odd. there are a ton of legal nuances here that i do not want to get into, but suffice to say we want to be clear and transparent to customers while at the same time providing a compelling wage to all the folks who touch your order during any part of the lifecycle.
    - mikeklaas 9y ago
      It is really hard to believe that instacart wants to be clear and transparent as possible (although I'm sure you do, personally). If "service fee" was renamed "instacart fee", people would no longer assume it is the driver's tip. But instacart would never do that, would they?
- 9y ago

petra 9y ago

>> why do you think that there can only be one victor here, and that is has to be amazon? Historically, online businesses have 1/2 winners that "take all". That's assuming the winners could build a warehouse near each city. seems possible. So the question who will be the one besides Amazon? From one point of view. Walmart will likely win in the low-cost grocery pickup business. And on top of that they will do deliveries. The way Walmart will choose that delivery is: is it cheaper than delivery costs for Walmart(for chilled deliveries)? and can it scale ? . Does instacart fit ? it seems not. So it's hard to see how instacart wins.

octernion 9y ago
groceries are unlike pretty much every other online segment, which is why it has resisted being moved online (until very recently). the model of having a warehouse simply "near" a city is a model amazon has tried for 10+ years without success -- you must have many warehouses within the city to make it work. i am not entirely clear how you arrived at "Does instacart fit ? it seems not.", so it would be good to understand that. we have spent 5 years with hundreds of engineers building a fulfillment/logistics network just for groceries that any grocer can just leverage off the shelf.
- ssharp 9y ago
  I think he's saying a customer will ask "is Instacart cheaper than Walmart" and the answer is "no", so there isn't a place for Instacart to fit, assuming Amazon owns the high-end side with Whole Foods (although I wouldn't assume Amazon would settle for just that). Walmart already has grocery warehouses with their stores, so bolting on pickup/delivery to those makes sense. I don't know how much pickup/delivery could potentially negate the need for the store, but I'd assume the pickup/delivery load of a store has huge room for growth before you start questioning why the store needs to be open to the public. I haven't used their grocery delivery service but their pickup service is well-executed and convenient, in my experience, so I'm assuming they can figure out how to be competent in delivery as well.
  - octernion 9y ago

trs80 9y ago

Isn't it illegal to offer a "store credit" instead of a refund in cases where IC forgot my items and I paid debit? Seems like a really shady way to bring customers back. Don't get me wrong, I enjoy the whole concept of online ordering but the IC UI forces users into choices that benefit IC by default.

FireBeyond 9y ago
I believe when the refund is not the customer's fault (though some choose to do it then), that the refund is typically "by the medium paid" (with some waiting, or such, for things like uncleared checks, etc.), but I'm not sure if that's a product of merchant regulation, consumer law or 'policy'.

cmclaughlin 9y ago

Overall I really like Instacart and quite frankly, I've come to depend on it. Shopping with kids is difficult... it's much easier to plan ahead and shop when I have a little free time. So congrats on the funding! I understand some of the frustrations about replacements. Originally the shoppers were pretty good about calling. Recently the app was updated for 1-1 chat and interactive replacement choices. However, it seems the shoppers are to busy to use the feature... I've had a few notifications for replacements, only to click on it and find the shopper has already checked out. Personally, I accept that limitation of the platform and make sure I choice "no replacement" if there's any chance I'll be disappointed.

octernion 9y ago
thank you for the kind feedback -- we love to hear from customers who we help like this! and, we are constantly trying to improve the experience (especially the replacement experience!)

tfehring 9y ago

Saying “we charge markups, but we won’t tell you what they are” is still not sufficiently transparent, in my opinion. Yes, Amazon and grocery stores do the same thing (at face value, anyway) by not disclosing their COGS. But the key difference is that my next-best alternative to Instacart is to just go to the grocery store myself. My next-best alternative to getting something delivered from Amazon isn’t to get it more cheaply from a brick-and-mortar Amazon store, or to buy it directly from their suppliers - it’s to get it from a different retailer entirely, and I can trivially compare all-in prices between other retailers and Amazon. So I can easily assess whether it makes sense from a cost/benefit perspective to buy something on Amazon, but I can’t make the same assessment for Instacart. I do think the service creates value. But I still hope that, at the very least, it soon faces enough competition that it’s at least forced to be fully transparent about the cost of its service. I want to see one number - the difference between what an order of groceries costs me on Instacart all-in, and what it would cost me to go to the grocery store and purchase the same items myself. As long as I can’t trivially find or calculate that number, I won’t use Instacart again.

octernion 9y ago
i am very confused why you have a higher bar for this than other services. would you actually create a spreadsheet that values your time (against other alternatives), gas/lyft/train fare to and back from the store, the extra costs associated with actually being in a retailer (and seeing the specials in store etc) and compare that against our offering? and again, we aren't the ones doing the markup -- those are coming from the retailer directly, who may (or may not) mark up prices, which is their prerogative. we put all of our costs in the checkout screen transparently.
- tomnipotent 9y ago
  >> and again, we aren't the ones doing the markup So you claim, but since you refuse to list what the IC markup is then it's impossible for us to tell. You're essentially using the retailer markup as an excuse to hide instances of when you do it yourself. Thus the lack of transparency. In any given transaction, I have NO idea what the actual % that was added by IC. I do not have this problem with Amazon Prime.

abawany 9y ago

My experience with Instacart has been pretty great so I was shocked at the GP vitriol as well. In my case, Instacart has been a huge help - my brother, who is unable to drive for medical reasons, uses your service considerably to get his weekly groceries. Once I figured out the substitutes scheme, it worked like a charm.

Density 9y ago

I appreciate you as an engineer, and to weigh in against an Amazon troll, but like please keep hn neutral

octernion 9y ago
i am not entirely sure what you mean by this -- sorry. i was not trying to be divisive and offer a personal perspective as an engineer. can you clarify please?

bm1362 9y ago

There are a subset of users on HN that can be hyperbolic. I've worked at a few well known companies and every time they come up here you get some vocal minority outraged about the product/pricing/culture/tech/anecdotal experience etc. I think it's truly toxic (yet entertaining) and definitely deflating as an employee. There is a lack of empathy for other people, companies and a deep inability to disconnect the two. I've noticed a hyper-rationalism here that reduces every company and product into the sum of it's parts and deems it outrageous- which to me comes across as unhealthy (reminds me of going to lunch with an engineering team that optimizes the route, their orders, seating, etc). Congrats on the raise and good luck with everything.

clay_the_ripper 9y ago

You’re right, this was a bit harsh. I’m sure lots of good people work at instacart, and this was not intended to seem like I’m excited for anyone to lose their job. I guess a more accurate statement would be “now that I’ve discovered amazon prime now is available in my area, I’m excited for the competition between these services to offer me a better quality product at a better price”. Sorry if I offended. Cheers.

octernion 9y ago
just saw this -- no worries, and thank you for your response. i think that is very reasonable and we are excited to go head-to-head with amazon on all fronts (delivery experience, quality of jobs offered, retail offerings/selection/etc).

itronitron 9y ago

In order for instacart to survive, it needs to partner with regional grocery chains by providing them with the 'ecommerce' side while the grocery chains provide delivery. I live in a metro area where a local chain now provides excellent delivery service (and the employed delivery people won't accept tips) and hope they succeed long term. I don't use Amazon for groceries although it might be available, and I never shop at Whole Foods because their stores are way too large. Whole Foods would dominate if they roll out 'whole foods Express' stores which would be much smaller (think 7-11) so that people can get in and out without feeling like they are walking through the Natural History Museum. Families buy the most groceries and are the most time constrained, but I'll never use instacart until they drop the whole gig-economy frontline workers as contractors bullshit.