Instacart Finds Winning Niche As Revenue Grows

By Hannah Ash, contributing writer


Retailers Slow To Offer Integrated Retail Solutions Partner With Instacart

Founded in 2012, same-day delivery grocery startup Instacart has seen incredible growth over the past two years. In the past two months alone, Instacart states it has seen revenue growth of 2.4x. Though currently available in a few select cities around the country, the delivery service has set its sights on expansion, and for good reason: Instacart has found a strong niche in retailers whose channel integration has been, at best, slow. Popular nationwide and local grocers that haven’t been offering same-day pick-up and delivery options are realizing they must jump into omni-channel feet first to deliver the personalized experience their shoppers crave.

Making regional news in the Boston area, New England chain Market Basket has partnered with Instacart to offer door-to-door delivery service through the grocery’s couriers fleet of personal shoppers throughout Boston and its suburbs. Market Basket is an example of a retailer that has largely been one-note when it comes to retail commerce strategies. The regional grocer currently sports a very minimal website, which is limited to offering consumers a weekly updated circular. In addition to Market Basket, Instacart has also teamed up with Costco, Shaw’s, and Whole Foods to offer customers the ability to shop and make grocery purchases online. While Costco offers omni-channel shopping for its non-consumable products, both Shaw’s and Whole Foods have been mostly one channel.

Though it does accept catering orders and allows customers to refill prescriptions online, the Shaw’s online channel is limited. The Whole Foods online channel is largely decentralized, offering different information from store location to store location. The online channel currently only offers shoppers the opportunity to purchase gift cards and place catering orders online. As a response, it seems that Whole Foods, has teamed up with Instacart to fill the gap while it works on strengthening its omni-channel presence with a move in the works toward a unified POS platform. In an earnings call, CEO Walter Robb declared, “the experience of retail is the culmination of retail and technology.” In 2013, Whole Foods filed for a series of trademarks, indicating that plans are in the works for the natural and organic foods retailer to break into the world of ecommerce. As grocers scramble to embrace integrated retail solutions, however, Instacart appears poised to expand and perhaps to dominate the world of same-day grocery delivery. Just last week, the delivery service introduced its service to the New York City market.

Omni-Channel Logistics: How Retailers Can Win