Amazon (AMZN) has quietly launched a grocery-delivery service called Amazon Fresh in its hometown of Seattle. Michael Arrington wonders if Amazon remembers Webvan, the dotcom flameout that spent too much money on trucks and refrigerated warehouses and went through ungodly gobs of cash in the process. But perhaps it's got its eye on Fresh Direct, which has become a fixture in New York City over the past few years. Online groceries can work if you target dense urban areas and extend service only into those areas where the demand is likely to be the greatest. Like most food businesses, it's more of a hyperlocal play (neighborhood by neighborhood) than a national play. The real question is: How many neighborhoods in America can support such a service?
I am surprised grocery stores haven't figured out a way to just allow people to order online and then pick up there groceries. They would be able to fill up their store space with more inventory and have staff to just fill orders rather than making all the display cases look nice. This would be a hybrid between the Fresh Direct/Costco/Supermarket models.
Posted by: Eric | August 02, 2007 at 01:22 PM
I agree. Every existing grocery store chain could increase service and efficiency by offering weborders for pickup. Pending the success of web orders w/ local pickup, they could roll out the delivery feature.
Posted by: Dave | August 02, 2007 at 04:04 PM
Most grocery stores already do offer online delivery and pick-up services. They haven't done much promotion of these services since they still want you to come into the store. Apparently up to 60% of sales are from impulse or related items as people browse the store.
Posted by: Bob | August 03, 2007 at 09:15 AM
I live in Chicago, IL and use PeaPod all the time to order groceries. I find it completely wonderful and the only way to go.
As for those worried about the web reducing impulse buying, don't I still do it from time to time when using PeaPod.
Posted by: Bertram Moshier | August 19, 2007 at 04:21 AM