The Net and Grocery Shopping

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I felt like I’d stepped into a timewarp. First, I saw the Fortune article: “Next up for disruption: the grocery business.” Then it was “Webvan’s Founder is Back And He’s Building A Grocery Delivery Business” on Re/code.

I remembered the time when Webvan was going to transform the grocery business. It didn’t end well, as you might suspect. Webvan was a spectacular, light-up-the-night-sky flameout of a disaster. In Fortune, Dan Mitchell suggests that the Webvan failure was the big reason that online grocery shopping hasn’t caught on. Then he says this:

“But Webvan didn’t prove that online grocery-shopping can’t work. It proved only that capital must be patient. Webvan grew too big, too fast, trying in the heady days of the dotcom boom to behave like the information-technology startups that were its Silicon Valley neighbors.”

Certainly expanding too fast was part of the problem. But the big problem was that the founders succumbed to “The rules don’t apply to us” disease. They were great at raising money, drawing up strategic plans, and giving interviews. Alas, not one of the Webvan team, not one, had ever worked in the grocery business. Hopefully this round of company founders and funders will have learned from that, at least.

When I was growing up, grocery stores delivered. So did the butcher, the greengrocer, and the pharmacist. My mother would call them or stop by the store and tell them what she wanted. They would deliver it. Sometimes they would call her to suggest a real treat she might want to buy.

What all the companies jabbering about online grocery shopping are trying to do is re-create that experience. They want to use newer technology to do it faster and better and at a profit, but it’s the same experience.

As you read the following articles, think about that. There’s no Law of Nature that says technology is the only answer. My guess is that the final winners will be the companies that gets the mix of components right.

And if you think about Webvan, think about this. It all might have turned out differently if the Webvan people had started with the idea that they had something to learn, instead of the confidence that they knew it all.


Harris Teeter – Express Lane

From the LA Times: Instacart grocery delivery service rolls out in Los Angeles
“Sometimes called the Uber of grocery delivery, or the Amazon of online grocery shopping (even though Amazon has its own online grocery service), San Francisco-based Instacart has launched in Los Angeles. The same-day grocery delivery service taps a team of crowdsourced employees who use their own transportation and shop for and deliver groceries to customers within an hour or two.”

From Re/Code: Amazon Dash and The Race To Slash The Time Between “Want” and “Buy”
“In the last two months, Amazon has spotlighted two new products that allow shoppers to add items to their shopping list without ever typing anything into a search bar. This isn’t a coincidence.”

From the Star Tribune: Lunds goes after growth in a high-end niche with new concept store
“While others fight for price-focused shoppers, Lunds and Byerly’s is opening new locations and experimenting with a new store concept.”

From the Philadelphia Inquirer: Wawa celebrates 50 years of keeping customers happy
“What began in 1964 with a single store in Folsom, Delaware County (it’s still open), has morphed into a $9 billion enterprise with 22,000 employees and 650 outlets in six states dispensing round-the-clock coffee, made-to-order sandwiches, hot meals, snacks, and more than a little TLC.”

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