For online grocer FreshDirect, technology is more than a means of taking orders and orchestrating delivery, but a way to build trust in food that shoppers can’t see, feel, smell or taste.
“A lot of people think this business is about home delivery,” FreshDirect founder and CEO Jason Ackerman told an audience at the Consumer Goods Forum’s Global Summit Thursday in New York. “But actually, the business is about food. It’s about, how do we take the retail business and use the Internet and technology to make food fundamentally better.”
While FreshDirect lacks the ability to display foods the way a physical store can, removing the need to warehouse, distribute and arrange items for sale like stores typically do has allowed FreshDirect to re-engineer the supply chain to provide faster and fresher service, he said. This helps foster trust in the brand.
“Our idea was to take orders in advance of the sale and have a single consolidated facility where you could vertically integrate all of the value-added manufacturing — the commissary, the kitchen, the meat cutting and fish cutting, deli, cheese and roasting coffee — and do that after we’ve taken the order. That way we can offer mass customization, we can reduce shrink and waste, and give the customer a better quality product.”
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Fully exploiting that capability has meant partnering with farmers — in some cases, providing the cold-chain by taking its own trucks to the field — and by providing marketing for the items on its website. Transparency with customers — including a rating system informing shoppers what items are freshest each day — has also helped to win their trust.
“If something’s not great, we’re going to tell you,” he said.
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