Evolving Grocer’s Deli to Restaurant Delivery

 

Technology has changed our world. Automatic bank deposits, self-breaking cars, drone delivery, and now the ability of grocery stores to delivery grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared meals, meal components, and beverages within an hour or less in many cases. 

According to Steven Johnson Grocerant Guru® at Tacoma, WA based Foodservice Solutions® stated, “the meal delivery business changed the day Instacart acquired FoodStorm.” Technology that can be disruptive is nothing new, however this particular tie-up can elevate the grocery store service deli like no other; if legacy grocery companies are ready to evolve as well.  If not, there will be new non-traditional fresh food retailers ready to jump into the mix according to Johnson.

So, with this acquisition, Instacart says it is expanding its enterprise technology portfolio to further support its retail partners’ digital foodservice, investing in more technology solutions that aim to help retailers grow, compete and better meet the evolving needs of their customers. 

Instacart Chief Technology Officer Mark Schaaf, recently stated in an interview, "People eat 21 meals a week, give or take, and we want to help our retail partners create more opportunities for their customers to get more and more of those meals from the grocery store,".. "We think for customers, this helps unlock a healthier, more affordable alternative than grocery delivery, and creates an easier way for people to order prepared foods online, directly from their favorite retailers that they shop from already today. And so that's another really exciting aspect of this acquisition."

Get this, FoodStorm offers a comprehensive SaaS solution that covers multi-channel ordering — e-commerce, phone or in-store kiosk — order management and payment and fulfillment. Its technology also integrates with a large variety of third-party systems, including point of service systems (POS), and offers CRM capabilities that help grocers collect feedback, market their offerings and leverage promotional features according to the article. Which translates to it’s ready-set-go for legacy grocery retailers.

In case you did not know, FoodStorm, founded 14 years ago in Australia, has developed strong partnerships with a number of Instacart’s existing retail partners including Albertsons Cos. banners Balducci’s, Kings Food Markets, Bi-Rite Market, Mollie Stone’s Markets, Uncle Giuseppe’s and Roche Brothers.  Instacart will make FoodStorm’s technology available to more retailers through Instacart’s enterprise technology offering. That said none of those retailer’s are using FoodStorm’s to its full potential according to Johnson.

What is it grocery stores don’t understand? Is it that the order-ahead technology solutions provide grocery retailers with a significant growth opportunity? On the Instacart platform, customers who purchase prepared foods and catering items like hot and cold side dishes, cakes and sushi from the grocery store have significantly larger baskets and shop more frequently than those customers who do not, the company said. Regular readers of this blog know that mix & match meal component bunding is a hallmark of grocerant niche success.

Schaaf continues, "Prepared foods are very big at all these retailers and a huge growth area for these retailers,"…. "But we want to help retailers provide the best possible experience for their customers, which means bringing their entire catalog of products and services onto the marketplace, which they don't have the best experience right now on Instacart. And we want to make that better."

I wonder if grocery stores understand that, order-ahead items and prepared foods are also typically more profitable than traditional groceries like produce and package goods.  

Schaaf had even more insights to share in the article, "Grocers see this as an incredible growth area for their business,"... "We've seen that ‘customer’ baskets on the Instacart platform that include meals are significantly higher than baskets without prepared or premade foods. We've also seen customers who purchase meals order more frequently than customers who do not purchase grocery meals, and today meals are in I think 21% of customer baskets. And we think there's a large opportunity of growth for our retailers in this space."

In case you did not know, Instacart’s enterprise technology today powers the e-commerce platforms of more than 175 local, regional and national grocers across North America, including Costco Canada, Heinen’s, Sprouts, The Fresh Market and Wegmans.

Instacart first began offering enterprise technology to grocery partners in 2017. Since then, the company has continued to make significant investments in its enterprise business, scaling its engineering team and developing new technologies for grocers.  Instacart’s platform is available to over 85% of U.S. households and 80% of Canadian households.

Invite Foodservice Solutions® to complete a Grocerant ScoreCard, or for product positioning or placement assistance, or call our Grocerant Guru®.  Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869