Uber repurposed a transportation model into a delivery engine by applying experience it had built in moving people, and then building on that experience to move food products effectively.
The Next Phase
Over the years in which the company developed its grocery delivery model, San Francisco-based Instacart has been able to develop technology and experience that have helped it gain traction based on a deepening understanding of the food retailing industry and its complexities, according to Chris Rogers, the company’s chief business officer.
“This knowledge has allowed us to build the technologies to power online grocery for retailers of all sizes, helping our partners effectively compete as customer preferences continue to evolve rapidly,” notes Rogers. “Together with our grocery partners, we aim [to create] the most seamless, affordable and personalized experiences possible to serve customers. Since our founding, we’ve focused on bringing grocery shopping online and have since expanded our role to be a foundational retail enablement partner, dedicated to helping retailers compete against digital-first competitors and win. We believe technology will continue to play a significant role in up-leveling and seamlessly integrating the online and in-store experiences for consumers, improving operational efficiency and inspiring greater retailer profitability.”
Instacart has helped lay the foundation for the next phase in the grocery sector’s development, contends Rogers, one where the store visit is only one of several options that consumers will pick, depending on their needs at the moment.
“We believe grocers can and should offer customers the latest in e-commerce, fulfillment, in-store innovation, advertising and personalization — everything they need to build the store of the future,” he says. “Through the Instacart Platform, we offer retailers solutions to provide a more personalized grocery shopping experience, both online and in-store. We also work closely with our CPG brand partners to develop new ad offerings that help them connect with and inspire their consumers, and measurement capabilities that help them more deeply understand the impact their ads are driving on Instacart. Our goal is to continue to create innovative technologies and solutions that help both CPG brands and retailers connect with their customers in a new way.”
Of course, technology has driven immense change in how people and things move across the landscape today, and not just in home delivery. However, the flexibility built into modern technological systems has allowed them to multipurpose in interesting ways.
Uber is a case in point. The rideshare provider has taken its basic business model and developed variations such as Uber Eats. As it did so, Uber took the experience and proficiency that it developed, and then repurposed them to create its dedicated food delivery system.
“At Uber, we bring a few unique things to the table for merchant partners: our technology, our global logistics expertise and our strong consumer brand that comes with a built-in user base of more than 100 million consumers around the world,” says Therese Lim, who leads Uber’s Product Team for Grocery. “We’re hearing interest from our grocery partners — both new and those we’re talking about working with in the future — in being omnichannel retailers: They want to meet customers wherever they are and however they’re looking to shop on any given day.”
The 100 million consumers worldwide who are already interacting with the Uber platform are a dynamic audience, Lim notes, “looking to go places and get things delivered; this means we’re an attractive place for retailers and grocery brands to reach new and existing customers. Our delivery network provides retailers with broad coverage to help expand their delivery service areas. Across the country and around the world, we’re uniquely positioned to help them get what they’re looking for from the merchants they love in under an hour, whether they’re cooking and forgot an ingredient, or planning their weekly shop and just don’t want to jump in the car. These are different kinds of shoppers, and we’re looking to satisfy both with an experience they can count on.”
The pandemic-forced rapid development of grocery delivery networks has been a major challenge all around. Consumers are themselves adapting to the new features and functions that the grocery marketplace offers. Companies providing delivery services have had to update their operations quickly and almost constantly as competitors and consumers alike weighed their options. Lessons learned had to be quickly applied.
“One of the things we learned when we started building for grocery retailers is that there is no one-size-fits-all approach, especially as we work in more than 30 countries around the world,” says Lim, “and each market brings its own unique expectations and challenges from retailers.”
As such, delivery businesses have survived and grown based on their ability to quickly adapt in response to consumer demand, retail need and competitive pressure. Uber is another operation that saw a need to accommodate retailers that want to have their own employees shop for delivery orders, as well as those that want a partner to take care of the picking.
“As a result, we’ve built for both options to give retailers more control,” notes Lim. “Our team designed new features like item replacements and live order tracking to create a more seamless experience for consumers, shoppers and grocers. Grocers have made it clear that they want a seamless experience with a reliable partner. We’ve made those expectations the cornerstone of how we build products so that it comes through in our platform experience and other interactions grocers have with Uber Eats. We’ve also invested heavily in what we call Uber Direct, which is our white-label delivery-as-a-service option for retailers to plug into their own e-commerce platforms. Uber takes care of the delivery and logistics, while the retailer manages marketing, order intake and the customer relationship.”
For DoorDash, the company’s associates who are in stores picking orders for consumers are critical assets that have to be carefully considered.
“There’s a lot done in terms of identifying who are the right Dashers for these kinds of dashes,” affirms Hannon.
Each associate is evaluated specifically for their ability to get orders right, and who might be diligent enough to handle an order of 50 items rather than five or six, as would be the case with a restaurant pickup. For restaurant orders, speed and efficiency are of the utmost importance, but for grocery orders, DoorDash looks for associates who understand that it’s important to take enough time to ensure that they reach the customer with the correct order. The need to do so is particularly important with perishables such as produce, where selection can be subjective. By interacting with customers, notes Hannon, the same Dashers who have the patience to select other products appropriately can get the best idea of just what the right piece of fruit or best example of a particular veggie is.
The flip side of getting the order right is working with grocers to have a better grasp of what’s in stock so that consumers are provided with the correct choices and issues such as substitutions, which can be pain points for consumers, don’t come up.
“One of the key things we have to nail down with grocers is the problem of understanding what’s in stock,” says Hannon.