How the Explosion of Local Mobile Ecosystems Are Disrupting Grocery Shopping

Brandify Team | Feb 6, 2014 6:05:36 AM

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With so much talk lately about Apple’s iBeacon, the rise of indoor mapping, & the emergence of a new consumer path-to-purchase which merges the on- and offline retail experience, it would be easy to overlook another trend taking the consumer retail world by storm. This new path-to-purchase trend is one that brings the product to the consumer rather than the consumer to the product.

Delivery services, of course, are not new by any stretch of the imagination, but the application of an on-demand service model to consumer experiences that previously were entirely consumer action oriented (ie, visiting a retail store or proactively seeking out a product) is on the rise.

Popularized by the explosion of Uber, the on-demand car service disrupting the taxi industry, there seems to be a wave of “It’s Uber, but for ___” (fill-in-the-blank) services popping up all over the place. Regardless of what service these new companies provide, one thing they all have in common is that their success hinges on the local and mobile ecosystems.

TechCrunch columnist and Silicon Valley investor Semil Shah put it this way in an article he wrote for his own personal blog:

Depending on what city you live in, chances are you’ve now been trained to tap your phone and get a specific service, like a black car, or a car with a pink mustache, a person to bring you a burrito, or your groceries, or someone to clean your car, clean your apartment, or clean your laundry, or ship your boxes, and so forth. Every week, a new service seems to launch that aggregates and organizes freelance labor (those with excess time) to help those who have money but not time.

One instance of the “It’s Uber, but for ___” model which we find particularly interesting -- perhaps because it seems to have influenced retail giants like Walmart & Amazon to follow suit -- is it’s application to the grocery industry. Let’s take a deeper look.

"It's Uber, but for ___"

Still very much in it’s infancy, Instacart launched in mid-2012 and hopes to leverage its $11 million in venture funding and its founder and CEO Apoorva Mehta’s extensive experience in building robust logistics systems -- he previously worked on shipping packages more efficiently with Amazon Global Fulfillment -- to make sure that you, the consumer, “Never set foot in a grocery store again.”

With partnership deals with major grocery chains like Whole Foods, Trader Joe’s, Costco, and Safeway, the consumer simply places their order using Instacart’s mobile app (or website), and the company’s sophisticated software and expert personal shoppers do the rest for you. What’s even more interesting, the system ties in some of the new consumer driven path-to-purchase themes mentioned earlier, like indoor mapping:

“In addition to the grocery list, the software knows where each item’s location in each store and provides the most efficient path to plucking. ‘Think of it as technology that mapped out the store,’ he [Mehta] said, noting that machine learning improves the paths.” (source)

While less than two-year-old Instacart’s attempts to disrupt the grocery industry “one delivery at a time” have caught the attention of investors and consumers, like any good innovative product brought to market they’ve also sparked some interest elsewhere -- the competition. Even the big boys — Walmart, Google & Amazon — are testing the waters of local-mobile on-demand grocery service with Walmart To Go, Google Shopping Express & AmazonFresh.

While there’s no clear winner yet, it’s sure to be an interesting year in grocery shopping.

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