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In the UK, all of the traditional supermarket chains moved pretty early to build their own online grocery platforms. The services are all generally pretty good.

In the UK, all of the traditional supermarket chains moved pretty early to build their own online grocery platforms. The services are all generally pretty good. They seem to have successfully made that transition and kept most of the grocery market for themselves (with the exception of Ocado, the online-only service, which I guess is a slightly weirder example due to their supply arrangements with one of the existing chains). As such, I can’t really imagine anyone else entering the market, or Amazon being an effective competitor. I don’t think I’ve ever encountered anyone using the Amazon service here. Is there some obvious reason the same kind of market change didn’t happen in the US?

rolleiflex 8y ago
Same in Turkey as well, Migros and Carrefour kept the market to themselves by offering delivery fast, early. Migros had an online grocery store in 2000, even! That's early. I think US is uniquely suited to such a thing because of its sheer size. A supermarket company that has not built effectively a parallel supply chain cannot accommodate allowing a guy from New York and a guy from San Francisco to shop using the same stock, especially if perishable, because there is no profitable way to ship something from CA to NY in a few days. That effectively means CA and NY are, so far as groceries go, completely independent markets, and that creates challenges that being a supermarket does not inherently give an advantage in handling. In contrast, UK or Turkey are countries that are sized small enough that a lorry can cross in a day, given the need. That allows you to act like you have a 'supermarket' in the middle of the country, and you're taking orders by the phone, and sending them to their way. That mental model is much easier to handle for a supermarket chain than doing continental-scale logistics that Amazon is adept at.
- matthewowen 8y ago
  I'm not convinced thats the reason, because that isn't how the online grocery stores in the UK work: from my recollection, you're effectively shopping from your local store and the options reflect that.
  - rolleiflex 8y ago
    Interesting to hear. In Turkey, they ship to the whole country for most types of goods. Effectively treat the whole country as a single locale. With few exceptions for things like eggs, milk, I think.
jccalhoun 8y ago
It has. The local Kroger (a big USA grocery chain) took out like 8 of the spots closest to the doors and made them "clicklist" spots where people who order online can pull up. They are almost always empty.
petra 8y ago
Maybe: Delivery is much more expensive in the US, because middle-income+ people live in lower density, suburban areas. Much harder. even Amazon struggled. So this means market share will probably be smaller in the US than the UK(which was quite low). So maybe in the UK , that was one of the best growth opportunities for grocers. But in the US, with it's huge size, there we're better, less risky, standard growth opportunities. So why would a manager risk his career on online groceries in the US ?
bartread 8y ago
Don't bet on that. I contracted for $LARGE_UK_RETAILER for a while and I can tell you their ability to effectively develop and deliver solutions with a significant technological component is extremely poor nowadays[1]. It's resource hungry, slow, inefficient, and - perhaps surprisingly - not particularly focussed on the customer. They moved into online shopping early, but they are in no position to develop that value proposition at anything like the kind of speed Amazon can. They've already substantially failed to compete online beyond their core grocery offering, yet still do not see Amazon as an existential threat to that offering - something which always struck me as complacent. Anecdotally they're not alone: based on accounts from other contractors $OTHER_LARGE_UK_RETAILERS are just as shoddy when it comes to effective value-adding technology delivery. [1] I can think of one example where this was not the case, but it was far from the norm.

rolleiflex 8y ago

Same in Turkey as well, Migros and Carrefour kept the market to themselves by offering delivery fast, early. Migros had an online grocery store in 2000, even! That's early. I think US is uniquely suited to such a thing because of its sheer size. A supermarket company that has not built effectively a parallel supply chain cannot accommodate allowing a guy from New York and a guy from San Francisco to shop using the same stock, especially if perishable, because there is no profitable way to ship something from CA to NY in a few days. That effectively means CA and NY are, so far as groceries go, completely independent markets, and that creates challenges that being a supermarket does not inherently give an advantage in handling. In contrast, UK or Turkey are countries that are sized small enough that a lorry can cross in a day, given the need. That allows you to act like you have a 'supermarket' in the middle of the country, and you're taking orders by the phone, and sending them to their way. That mental model is much easier to handle for a supermarket chain than doing continental-scale logistics that Amazon is adept at.

matthewowen 8y ago
I'm not convinced thats the reason, because that isn't how the online grocery stores in the UK work: from my recollection, you're effectively shopping from your local store and the options reflect that.
- rolleiflex 8y ago
  Interesting to hear. In Turkey, they ship to the whole country for most types of goods. Effectively treat the whole country as a single locale. With few exceptions for things like eggs, milk, I think.

jccalhoun 8y ago

It has. The local Kroger (a big USA grocery chain) took out like 8 of the spots closest to the doors and made them "clicklist" spots where people who order online can pull up. They are almost always empty.

petra 8y ago

Maybe: Delivery is much more expensive in the US, because middle-income+ people live in lower density, suburban areas. Much harder. even Amazon struggled. So this means market share will probably be smaller in the US than the UK(which was quite low). So maybe in the UK , that was one of the best growth opportunities for grocers. But in the US, with it's huge size, there we're better, less risky, standard growth opportunities. So why would a manager risk his career on online groceries in the US ?

bartread 8y ago

Don't bet on that. I contracted for $LARGE_UK_RETAILER for a while and I can tell you their ability to effectively develop and deliver solutions with a significant technological component is extremely poor nowadays[1]. It's resource hungry, slow, inefficient, and - perhaps surprisingly - not particularly focussed on the customer. They moved into online shopping early, but they are in no position to develop that value proposition at anything like the kind of speed Amazon can. They've already substantially failed to compete online beyond their core grocery offering, yet still do not see Amazon as an existential threat to that offering - something which always struck me as complacent. Anecdotally they're not alone: based on accounts from other contractors $OTHER_LARGE_UK_RETAILERS are just as shoddy when it comes to effective value-adding technology delivery. [1] I can think of one example where this was not the case, but it was far from the norm.