Whole Foods makes aggressive move into e-grocery biz
During Whole Foods’ third quarter earnings call in July, co-CEO Walter Robb discussed plans to move ahead with the chain’s "digital roadmap" designed "to offer customers more choices and new ways to engage" with the retailer. Yesterday, the natural and organic grocery chain’s plans became clearer with the announcement that it was partnering with Instacart to offer online ordering to customers in 15 major metro areas around the U.S.
Right now, customers of Whole Foods can order groceries for delivery in all the markets where Instacart operates (Atlanta, Austin, Boston, Boulder, Chicago, Denver, Houston, Los Angeles, New York, Philadelphia, Portland, San Francisco, San Jose, Seattle and Washington, D.C.). Whole Foods will also begin testing in-store pickup at select stores in the Austin, TX and Boston markets beginning next month.
Instacart began offering delivery from Whole Foods’ locations in recent months, but what changes now is that the delivery service will now have its people in the natural and organic grocer’s stores.
"Instacart makes it extremely easy for our customers to buy Whole Foods Markets products from 15 cities and have them quickly delivered — whether buying fresh ingredients for dinner tonight or sending healthy foods to loved ones in another city," said Mr. Robb in a statement. "We are thrilled to add this additional convenience for our customers."
To order from Whole Foods, customers need to go to Instacart’s website or use its mobile app. Instacart customers get their first order delivered for free and subsequent orders are either $3.99 for two-hour delivery or $5.99 for delivery in an hour. There is also an annual membership offer in which consumers pay a $99 annual fee and get free deliveries for orders over $35.
Whole Foods is ramping up its e-grocery effort as more and more companies including Amazon, Door-to-Door Organics, FreshDirect, Peapod, Safeway, ShopRite, Walmart etc. are doing the same. The chain produced a humorous web spot to promote the new service.
- Whole Foods Market’s CEO John Mackey on Q3 2014 Results (Earnings Call Transcript) – Seeking Alpha
- Whole Foods Market and Instacart partner to offer one-hour delivery across 15 major U.S. cities – Whole Foods Market
- Whole Foods and Instacart turn up the heat in the delivery wars – Fortune
How will Whole Foods’ partnership with Instacart affect the direction of the grocery chain going forward? What will it mean for others operating in the online grocery space?