Kroger to deliver groceries using driverless cars

Discussion
Photo: Kroger, Nuro
Jun 29, 2018
George Anderson

Kroger has announced a new partnership that will enable the largest supermarket operator in the U.S. to make home deliveries of groceries to its customers without the need for drivers.

The retailer is partnering with Nuro, which bills itself as the manufacturer of the world’s first fully unmanned road vehicle. The pilot, which is expected to begin in the fall, is designed to help Kroger make affordable, same-day deliveries to its customers. According to a release put out by Kroger, the combination of the retailer’s size and Nuro’s technology will create a future in which customers will be able to enjoy the convenience of ordering and receiving the products they want, when and where they need them, at a low price.

“Unmanned delivery will be a game-changer for local commerce, and together with Kroger, we’re thrilled to test this new delivery experience to bring grocery customers new levels of convenience and value,” said Dave Ferguson, co-founder, Nuro. “Our safe, reliable, and affordable service, combined with Kroger’s ubiquitous brand, is a powerful first step in our mission to accelerate the benefits of robotics for everyday life.”

A Nuro YouTube video claims that the company “has created a new class of vehicle specially designed to navigate neighborhoods to keep outside (people) safer than what’s inside (products).”

“We are incredibly excited about the potential of our innovative partnership with Nuro to bring the future of grocery delivery to customers today,” said Yael Cosset, Kroger’s chief digital officer, in a statement. “As part of Restock Kroger, we have already started to redefine the grocery customer experience and expand the coverage area for our anything, anytime and anywhere offering.”

DISCUSSION QUESTIONS: How high are your expectations for Kroger’s pilot using Nuro’s autonomous vehicles? Do you see driverless deliveries as the future of grocery home delivery? What advantages do you see over other forms of delivery?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"It's far better to reach out and test the future than sit on your hands and try to play catch up with Amazon."
"As a consumer, I am always going to go with my local grocer, PeaPod or another delivery service that actually carries the grocery bags to my kitchen."
"...it is impossible to know which technology solutions will become ubiquitous in the future, However, we do know that the future is being written now."

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25 Comments on "Kroger to deliver groceries using driverless cars"


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Chris Petersen, PhD.
BrainTrust

The best way to predict the future is to create it. It’s great to see someone other than Amazon lead the way with innovation. While drones have received a lot of attention, driverless droids are the fastest route to the home in many neighborhoods.

The last mile is the most expensive and difficult for home delivery. While Nuro might not be the panacea, it is definitely rolling in the right direction. It can be used for many small items beyond just groceries. With Nuro Kroger is firing a shot over Amazon’s bow as well as upping the ante with its local competitors.

Will Nuro be cost effective? I don’t know — that’s why these tests are so important. It’s far better to reach out and test the future than sit on your hands and try to play catch up with Amazon.

Dr. Stephen Needel
BrainTrust

I assume the cost of the vehicle is more than compensated for by lower labor costs over its useful lifetime. The issue with grocery picking and delivery still remains — how good is the meat and produce that someone (or something) else chooses? Is the food fresh after a few hours on the road? Yes, it could be the future once the logistics and safety technology and security issues are worked out.

Phil Masiello
BrainTrust

This is certainly worth testing. But calling it a game-changer is a bit of a stretch. There are several logistics issues that would need to be overcome. Along with customer acceptance of the service.

Meanwhile, Amazon is announcing financing an independent fleet of delivery companies. The difference between autonomous vehicles and manned vehicles is getting the product to the front door and ensuring customer satisfaction.

I applaud the effort, but there is still a lot of items to be worked out for the customer.

Anne Howe
BrainTrust

What? Does it stop outside my house and honk the horn? Do I unload and carry stuff into the house? What if I grab a bag that’s destined for the next stop? Does it keep frozen things cold?
Frankly, the vehicle is cool, but I still like the idea of a little more human-ness in my grocery journey!

Lyle Bunn (Ph.D. Hon)
Guest

How exciting that this big idea of driverless delivery will find itself in a real world trial! Yes the vehicles will be a nuisance on the road as they attract attention, yes the logistics of delivery time communications will have to be refined, and yes some vehicles will be captured or destroyed, but let us not cry over spilled milk as major driverless advancements are being made.

Georganne Bender
BrainTrust

I’m not so sure where I stand with driverless cars yet, but I am sure about grocery delivery.

As a consumer, I am always going to go with my local grocer, PeaPod or another delivery service that actually carries the grocery bags into my kitchen. A service built on convenience ought to be fully convenient.

Max Goldberg
Guest

Kroger joins a list of companies preparing to make deliveries using autonomous vehicles, all designed to drive (excuse the pun) costs out of the system. Eventually we will see large numbers of driverless cars on the road, but not for a while. Provided consumers are home to meet the vehicles and accept their deliveries, this is another positive step to save time and hopefully money for retailers and consumers.

Dr. Stephen Needel
BrainTrust

Max — it’s pretty rare that I disagree with you. I’m not sure this is going to save money for the retailer or for the consumer — indeed, likely to cost more for the consumer.

Art Suriano
BrainTrust
I firmly believe that someday we will have self-driving vehicles and the technology will be perfected. However, that will not be any time soon. Kroger’s investment with Nuro to build self-driving cars is okay but not the beginning we need. First, if they attempt to roll this program out, Kroger will have numerous issues with state and local municipalities getting permission to use their self-driving cars. Should there be the slightest incident when something goes wrong, the negative press will outdo anything positive Kroger hopes to accomplish. Moreover, as a start, I don’t see the benefit of self-driving cars being for deliveries. There are too many issues: 1.) What if the order delivered is wrong? Whom does the customer speak with for help? 2.) What if one of the delivered products has an issue? Whom does the customer speak with for help? 3.) What if the person accepting delivery is elderly and needs help bringing in the packages whom do they ask for assistance? The list goes on and on. Let’s perfect self-driving cars first… Read more »
Mohamed Amer
BrainTrust
Mohamed Amer
Independent Board Member, Investor and Startup Advisor
1 year 2 months ago

Change only happens when risks are taken in the form of actions that go against the status quo. The underlying process of moving groceries from one physical location to your home is not going away; what is changing is how this process is triggered, designed, and executed.

Using autonomous vehicles is a step in that redesign and the specific partnership between Kroger and Nuro should be seen as one set of actions from which both companies will learn and develop greater insights.

David Weinand
BrainTrust

First of all, I am totally digging all of the initiatives Kroger is testing. It’s the only way to remain competitive with Amazon and Walmart. The concept is a winner — no labor costs for delivery other than the pick/pack and reduced potential liability with drivers. Of course, the Nuro technology has to be flawless — and I don’t know enough about them to comment.

This type of delivery is certainly advantageous to the consumer as it is a time saver over even curbside pick-up. For Kroger, the drag will be the costs for the vehicles should this scale — and that could be an initiative killer.

Ken Lonyai
BrainTrust

This is clearly the future. The distant future. The immense hurdle is the legislation needed to allow autonomous vehicles on the road. If that comes to be and the vehicles prove to be financially more cost-effective than human-operated deliveries — which they probably will — this will become a mainstay in many iterations including mobile stores.

Until then, this is corporate spin and a tip of the hat to Amazon’s PR juggernaut which steals headlines turning out things like dirigible warehouses.

Dave Nixon
BrainTrust

I know Kroger, and I am glad they are going to be the first. The increased pressure for these huge retailers to innovate (Thank you Amazon, for that) has pushed companies like Kroger to rally their brainpower and innovation engines in revolutionary ways. For a company that big to become so nimble is another great America story to tell. For once it wasn’t Amazon.

I am most excited to see what new and compelling use cases Kroger’s 84.51 teams can develop with the “data exhaust” (pun intended) from these Nuro vehicles. Real-time tracking, just-in-time delivery, real-time weather and traffic data to leverage elsewhere in their supply chain. Bringing some of the anticipation and excitement back to grocery retailing since you have lost the discovery aspects of the physical store.

Gene Detroyer
BrainTrust

This initiative will do more for proving the safety of driverless cars than for grocery delivery or anything else.

I am all for the trial as these types of efforts often lead to other new and interesting initiatives.

But, I am afraid that we have just traded “the last mile” to “the last 10 yards.” How does the merchandise get from the car to my home? Or even to my door?

Rich Kizer
BrainTrust

OK, a few tongue in cheek comments: It’s raining, do I have to go out … ? If someone else gets my stuff, will receiving credit be seamless, and easy? And by the way, if I get stuck behind this vehicle going 25 miles per hour in heavy traffic for 25 blocks, I am going to be agitated with the name on the truck! Bad karma for the brand.

Now to be serious, the big point is that Kroger is intent on making gains in a very competitive industry — i.e. automated warehousing, driverless vehicles, etc. Congratulations Kroger, sounds like you’re hungry — and that’s good!

Neil Saunders
BrainTrust

At some point in the future, this will become commonplace. I have no doubt about that. I am not fatalistic or absolutist about technology, however, and I think this will be just one of a number of methods of delivering goods. Some will be fully automated, some part-automated, and some not automated at all. However, good for Kroger to be testing something new!

Cate Trotter
BrainTrust

This sort of experimentation is inevitable and it’s always worth encouraging people to test new ideas. However I am intrigued to know more about how it will work. Does an autonomous vehicle mean I have to make several trips back and forth from it as a customer to get all my shopping? How will I locate what is my order (or will each vehicle only carry one order at a time — which seems ineffective)? How will perishables be stored (and how will this affect me getting my items)? I think there’s a lot of logistical elements to work out (plus obviously all the safety stuff about autonomous cars), but I think there’s also an experiential factor to this. Will it improve or worsen my experience as a customer?

Keith Anderson
BrainTrust

Beyond the technical and logistical challenges, there will be cultural barriers to adoption. This won’t change the game overnight.

But it’s a great reminder that some of the prevailing assumptions about online grocery economics deserve to be challenged.

Labor and fuel costs remain two of the largest cost drivers, and there are high-potential technologies on the horizon (like this) that could significantly increase the long-term economic viability of home delivery.

Ricardo Belmar
BrainTrust

The most important aspect of this announcement is the announcement itself! Kroger takes a great shot at Amazon by making it clear they are not standing still and will be an innovative force for the future of grocery. Will driverless delivery from Nuro be the answer? I don’t know if this is any better than any of the other driverless solutions being developed, but it’s significant that Kroger is investing in testing this. They will learn quite a bit from this exercise and that will only help them strengthen the solution in the future if it proves itself worthy. Cost and safety will be just two of the obstacles to overcome — there are other logistics aspects not related to the delivery vehicle itself that need to be addressed but this will be a good one to watch closely and see how Kroger develops it.

Andrew Blatherwick
BrainTrust
The thought of driverless delivery vehicles charging all over our overcrowded streets is not only frightening, it could create a backlash from consumers. Technologically this is very smart, and I am sure that you can build a business case for the development. However, when those consumers start to lose their jobs because of this sort of technology they will realize that this is not great for everyone. People need jobs to be able to afford to live and taking away even these types of jobs will ultimately impact the population’s ability to shop and buy from the retailers online or at the store. As the first in the market you could be faced with the prospect of consumers campaigning against your business, particularly if, as expected, the robotics industry drives to replace warehouse workers, factory workers and who knows who else. How far are we from social reaction to these developments? In RetailWire again today there is talk of robots flipping burgers, just another in a long line of developments that is growing in speed… Read more »
David Naumann
BrainTrust
David Naumann
Vice President, Retail Marketing, enVista
1 year 2 months ago

While autonomous vehicles will be pervasive in the future, they will take quite some time to perfect. Kudos to Kroger for being one of the leaders in testing this automation, which may help accelerate the perfection and adoption of this technology. Once it is perfected and the cost of the vehicles are lower due to economies of scale, autonomous vehicles will become an expected product fulfillment option.

Consumers’ love for convenience has been the catalyst that has driven Amazon’s growth. Researching, ordering and receiving merchandise without leaving the home is very appealing to time-starved consumers. The last mile delivery part of the process is the most challenging and costly. Perfecting the last mile will likely involve autonomous vehicles. I wonder what it will be like when we are driving side-by-side with autonomous vehicles — or maybe by that time our vehicles will be autonomous too! We live in an interesting and exciting time.

Mel Kleiman
BrainTrust

I keep wondering how are the groceries are going to get from the car to the customer’s kitchen. What good is a driver-less car, when you can’t get the groceries the last 100 feet without having a person actually make the delivery?

Sterling Hawkins
BrainTrust

Kroger has been stepping into innovation lately! And this is another step in the right direction. It’s not a game changer overnight, but it will inevitably be a large part of delivery in the future. By getting up to speed with the tech and understanding what works before it becomes cost of entry, they’re getting ahead of the game.

Mike Osorio
BrainTrust

As many have said, it is impossible to know which technology solutions will become ubiquitous in the future, However, what we do know is that the future is being written now by people putting their ideas out into the market with a reasonable sense of potential customer adoption and economic viability. Many people who use grocery delivery services will find this idea fine, even with the requirement that they still need to walk out to wherever the Nuro arrives to carry the groceries into their home. I personally would want a service where a person would bring the groceries at least to my door, if not into my kitchen. Let’s see what happens!

Al McClain
Staff

I don’t think having to walk 20 feet to unload groceries from the vehicle will be an issue for most shoppers. The “rules of the road” for the service will be spelled out, and those who have an issue with it will go elsewhere. But, most consumers have no issue with the pick up part of BOPIS, and this will be easier than that.

wpDiscuz
Braintrust
"It's far better to reach out and test the future than sit on your hands and try to play catch up with Amazon."
"As a consumer, I am always going to go with my local grocer, PeaPod or another delivery service that actually carries the grocery bags to my kitchen."
"...it is impossible to know which technology solutions will become ubiquitous in the future, However, we do know that the future is being written now."

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