In online grocery shopping and delivery, getting produce right is paramount.
That’s what two grocery e-commerce veterans stressed Tuesday in a discussion panel titled “The Digital Retail Landscape” at the United FreshMKT and SmartFood Conference, held in Chicago by the United Fresh Produce Association.
For online grocery leader Instacart, 92% of all shopping baskets contain fresh vegetables and fruit, said Dan Bourgault (left), head of brand partnerships. But that didn’t come easy for the San Francisco-based company.
When Instacart was building its business, the top reason people didn’t do online grocery shopping was because they didn’t trust someone else to pick their fresh produce, he said. At the time, research showed that 86% of consumers not buying groceries online gave this as their chief reason.
“At Instacart, the No. 1 category people buy is produce. It’s not even close: first is fresh vegetables and then fruit, followed by beverages. So produce is the most important thing we have to be good at picking,” Bourgault explained. “Customer comments like, ‘I want ripe avocados because I’m making guacamole tonight’ are a big deal. If you screw that up, and they can’t make their guacamole, that’s a bad experience. The better we get with picking, and then trusting us to deliver the produce the way they want it and the way they like it, that’s how we get customers long-term.”
Mike Burrington, vice president at IdeoClick, a Seattle-based e-commerce specialist, noted that this trust must be earned. And he should know. Before joining IdeoClick, he served as senior vendor manager of produce and floral for AmazonFresh.com — helping to establish the service’s standards, processes and vendor relationships — and years earlier was category manager for fresh produce at online grocery pioneer HomeGrocer.com.
“I can’t tell the customer — I cannot tell mom — ‘Don’t worry, I can pick produce better than you can.’ Mom will say, ‘You can’t pick my tomatoes as well as I can.’ But if you prove it time and again by what you deliver, all of a sudden the trust that mom holds back falls into place. Then you’ve proven yourself, and now just don’t screw it up,” Burrington said.
That places a lot of responsibility on online grocery personal shoppers, who must be able to not only pick good quality vegetables and fruit but also follow any directions issued by customers, such as choosing green bananas.
Instacart’s Bourgault pointed out that this can be challenging when online grocery service is ramping up in a new market area and there’s demand for more personal shoppers.
“It can be trial-and-error in terms of how you get shoppers to be good at it. Produce is the No. 1 category they get tested on, in terms of knowing the difference between green leaf and red leaf and romaine lettuce. So you have to teach and train them,” he said. “We get some pretty avid feedback if they mess up. But we’re very good with due diligence and going back and saying, ‘That was a bad head of green lettuce. Here comes a new one, and we’ll get it to you within an hour.’
“Our shoppers want to make money, and when we train them, they know that quality is paramount to their success. They have to get produce right,” he noted.
Indeed, consumers pay close attention to performance and will speak up about their online grocery experiences, according to Burrington (left).
“Many people go to Amazon to make purchase decisions based on reviews. It breaks my heart now to read the reviews on Amazon Fresh,” he said. “They’ve made some choices and made some mistakes. But don’t doubt for a second that Amazon isn’t learning from those mistakes. [Amazon founder and CEO] Jeff Bezos has an expression, ‘Mistakes aren’t expensive. Errors of omission are costly.’ Take a look at any number of their offerings — whether it’s Pantry, Amazon Go, Prime Now, Amazon Fresh — there are mistakes and successes with all of those.”
Turning to Bourgault, Burrington spotlighted the importance of a reliable supply chain in online grocery no matter what the service model, whether it’s Instacart or Amazon Fresh.
“What’s interesting is that [Instacart is] no different with a pick-from-store model than Amazon Fresh is from a dedicated pick facility in that supply chain is key. To some extent, you’re at the mercy of each store you’re picking from and how well the produce manager maintains that department,” Burrington explained. “No matter how well-trained one of your pickers is, if those strawberries came in with condensation and the item is delivered to the consumer and molds the day after it’s received — and the same thing happens at Amazon Fresh — then you’re both in trouble. So supply chain is a big deal.”
Instacart has about 40,000 personal shoppers and counts more than 200 supermarket operators in North America as partners, which run the gamut from independents and small chains to the largest food retailers, including Kroger, Albertsons, Publix, Costco, Ahold Delhaize USA, H-E-B, Loblaw and Sam’s Club. Its service is now available in over 240 markets, and the company expects to reach more than 80% of households in North America by the end of 2018.
“We create a consumer-friendly environment for online grocery shopping,” Bourgault said. “The goal is to make as many people feel comfortable about the evolution of digital grocery shopping so it becomes part of the fabric of their lives.”