retail news in context, analysis with attitude

We continue to get a lot of email about the future of online grocery shopping, a discussion precipitated by the decision by Publix to stop a limited three-store test.

MNB user Beth Dolan wrote:

As a person who spends at least 3 hours every weekday commuting between NY and NJ the last thing that I want to do on Saturday morning is spend another 2 hours grocery shopping, my weekend time is precious. I was elated to learn that one of the ShopRite stores in my area has begun offering online shopping with pick-up or home delivery and I have used this service for my last three grocery orders. I love the convenience of being able to shop while eating lunch at my desk on a Friday knowing that I only have to drive down to the store on Saturday morning and pick up my grocery order(unfortunately I live outside of their delivery radius). This past weekend my husband decided he wanted to participate in the shopping and he preferred to go in person. About an hour into shopping I turned to him and asked his opinion on an item, he commented that whatever I wanted was fine with him as long at it got him out of there before his 60th birthday, which is many years away. Overall, including travel time, our shopping excursion took a little over 2 hours. Needless to say I will be placing my grocery order online this week and picking it up Saturday morning so that we can enjoy our time doing something relaxing together like having brunch at the local CSA farm.

MNB user Mike Spindler wrote:

There are plenty of folks making money at curbside service today.

There are plenty of retailers doing more than 1%, more than 5% more than X% of total store sales in online today.

There is no question that the grocery consumer is using an array of online and mobile tools to better meet their needs drivers. 

There is no question that more consumers used these tools this week than last, and more will use them next week than this. 

There is no question that the available tools are in their infancy and will improve in their ability to meet consumer’s needs drivers.

Publix competes today against sellers who offer online and mobile tools for closing the deal with consumers who increasingly want those tools.

You cannot win if you do not play.


MNB user Jan Fialkow wrote:

I grew up in the 50s/60s, and my family had store-to-door grocery delivery, albeit via phone. My dad had a small, independent grocery store in a suburb west of Boston. As my mom prepared dinner each night, my brother or I would sit at the kitchen table with a pen and paper to write down "the order" -- whatever Mom saw she needed. Then we would call Dad at 6:15 — never earlier, occasionally later — give him "the order" and he would bring it home. The downside was the tendency to order the same things over and over and over…

My dad's business had a large delivery component for years. I worked in the store on Saturdays when I was in high school; my job was taking customer orders over the phone. Within an hour or so of taking the order, the delivery boy —always a he and always called "the boy" even if were older than my dad — would set out in the truck. My dad was well known for the quality of his meat and produce. He went to the wholesale markets daily and if he didn't like the quality, he didn't buy. That meant a possibility of no peaches in the height of peach season or substitution of a cut of meat when something specific was requested. None of the customers seemed to mind because they knew he was staking his reputation on the quality of his merchandise. One long-time customer, a blind homemaker, trusted my dad to make sure her order contained produce in the sizes and degrees of ripeness she liked and meats with the marbling and thickness she wanted. "The boy" unpacked the order for her, putting everything in its proper place so she had no trouble finding anything later. She even allowed "the boy" to take the appropriate amount of cash out her wallet.

Maybe that's why I've searched out the invested local independent wherever I've lived. When it comes to perishables, I want the purveyor to care as much as I do. If I'm a Luddite, so be it!


MNB user Mike Nugent wrote:

KIDS BUYING EVERYTHING ONLINE??

I keep hearing this and I keep wondering who these kids are that buy everything online as stated in your commentary.  I hear stories of kids who go into a store with their iPhones and price shop and then go buy it online.  However, I cannot find any teenagers who have actually done this.  My kids do not do this and their friends do not do this.  My nephew’s kids who are in the 6 to 12 range do not do this.  I know there are studies that are suggesting this is occurring extensively, but unless I am absolutely in a small sample population which does not participate in this way, which seems pretty highly unlikely, perhaps the perspective for this should be refreshed.  For certain products no doubt, the ship has sailed such as music, but the experience to shop for music wasn’t that great to begin with.  My 16 and 18 year olds have their favorite stores and enjoy much more the rewards of trying on clothes, buying them, and bringing them home in large packages.

This “buy everything online” suggests a more difficult mental struggle for me which is who exactly is entrusting a credit card to their 10 year old?  But, let’s discuss that situation later.

As far as online grocery shopping, the lack of backward integration is what is missing.  The approaches I have seen attempt to automate a process in place rather than blowing it up and starting over.  One thing my children’s generation is much more comfortable with is sharing information I would never have shared.  When you ask for my data like what I ate or when I have appointments or what my schedule is, I am not that comfortable providing this information, it is private.  My kids don’t care and the information about what they consumed for their meals (replenishment) and what their social events look like (forecasting) are pieces of information they are easily sharing. Today’s approach is about automating your shopping trip.  But tomorrow, this generations ease of sharing information will make it about automated a meal planning that fits their food tastes AND THEIR SCHEDULE.

Just my $.02...


MNB user Frederic Arnal wrote:

One of my hats is an internet retailer.  My observation regarding the viability of grocery online is that we are making an erroneous assumption that traditional shopping models will transfer to the new channel.  The most successful online food retailers currently are those who view the ecommerce channel as an adjunct to their brick and mortar stores.  The primary role is that of communication and reservation.  Whole Foods does a great job of sending the latest deal and new product information to shoppers.  They also provide a terrific way to select and reserve for pickup holiday special meal offerings from their catering departments.

A few years ago, we had in the Chicago area a retailer (Scotty’s markets) who was way ahead of their time.  They furnished a bar code scanner to subscribers who would scan products as they used them.  This created a staple replenishment list which then could be uploaded to the retailer for delivery.  I can see new refrigerators with built-in terminals that would enable this service to homeowners and thus pare down the shopping experience to fun, perishable trips much like the European consumer.

Bottom line, we can’t face the future by “paving cow paths”.  Innovation demands paradigm shifts.


MNB user Ken Wagar wrote:

Your comments and those of certain of your readers regarding Publix’ cancelled test of e-commerce and in fact their 2nd walk away from such attempts suggest that you see this action as a negative and a failure to pursue a future you strongly believe is coming. I understand your view, however it seems to me that Publix deserves great credit for recognizing that they will need to find a way to facilitate a different future state of food retailing and have in fact invested time, talent and dollars in two attempts to do just that. It appears that in their judgment they haven’t yet hit on the right strategy and/or tactics for meeting that desired end state. I haven’t read anywhere that they have now decided that e-commerce is not desirable or achievable nor would I expect that they have given up. I suspect that they have gone back to the drawing board with what they have learned from their two attempts thus far and will in the not too distant future try a new method of entering that space.

Lots of unmanned missiles blew up on launch prior to us putting men on the moon. Maybe Publix will surprise you and maybe giving them credit for trying is fairer than castigating them for admitting that the current model they were trying was not viable.


MNB user Jim DeLuca wrote:

My wife make the best southern style cornbread in the world.  She only uses Hodgsons Mill White stoneground cornmeal.  At her last venture out to the grocery store she found that both Tops and Wegmans quit carrying it.  She looked online and found that Wal-mart stores might.  She located one superstore and called and was told they did not have it.  So she resorted to our first ever online food purchase.  Walmart sold 6 five pound bags for a reasonable price and WOW, only charged $.97 for delivery. And double WOW, it came in one day via fed ex and the guy delivered it onto our porch.   Ninety seven cents!!!

I am in the natural food grocery business and that freaked me out!


As well it should.

From another MNB user:

One point that seems to be overlooked is quality of produce, meats & other fresh products. I regularly have to “dig past” produce that is starting to turn or milk that use by date is tomorrow to reach the freshest product that I will use for the next week. This is true at all the big chains. Why should I trust a grocery manager or a 17 year old clerk to pick the best quality for me. For center aisle products online is good but for fresh foods I don’t trust them.

Let me say a couple of things here...

With some exceptions, I firmly believe that online grocery shopping should be offered as a service by traditional supermarkets ... it has to be integrated into a broader strategy. It isn’t going to take over the world anytime soon ... but it has the potential of making a store more accessible and relevant to a changing customer demographic.

If Publix, or any other company, decides it does not want to make online shopping a priority or an option for its shoppers, I think they have to follow their instincts. There’s nothing worse than doing it half-heartedly, and a company’s culture has to be nurturing if it is going to work.

Amazon is nibbling away at a lot of companies’ sales, even if they don’t know it. When (not if) Walmart starts doing online grocery sales, that will only ramp up the competition. As Mike Spindler said in his email, you cannot win if you do not play.

I agree that if supermarkets are going to be effective at selling fresh foods online, they are going to have to focus on picker expertise. You can’t have a 17-year-old part-timer picking the tomatoes. But it strikes me that this is an enormous opportunity to establish credibility and create a relationship with the online shopper.

The world is changing. Customers are changing. And to ignore this, I think, is to make a mistake. You can make the choice not to offer online shopping...but you’d better understand that the new competitive landscape includes companies offering e-grocery as an option, and you’d better factor that into your strategies and tactics.




Ironically, in terms of this discussion, we noted yesterday that it was the fifth anniversary of the announcement of the iPhone...and I suggested that the changes that have been wrought over the past five years may be nothing to compared to the next five. Which led one MNB user to write:

My guess is that in less than five years, when you order a pizza with your iPhone, you will actually smell the pizza before you order it. Think about scratch and sniff technology built into an app. In ten years, you will think what you want to say in a voice mail, email or text. The iPhone will then execute what you think into action…

Here’s the perfect place to quote Jean-Luc Picard:

Things are only impossible until they’re not.

All that is required is someone of ingenuity and imagination to make them so.
KC's View: