Internet sales as a total percentage of sales in the UK rocketed from 2. Japan's biggest ecommerce site, Rakuten, launched in among the first wave of online shopping giants Credit: Alamy.
Before Covid, relying on the internet for shopping hadn't been so ingrained in our day-to-day lives. A couple of decades ago, online shopping was a novelty, just as the internet itself still was. Most people were only buying hard-to-find records or obscure action figures on eBay. So how did we get to the point where online shopping became a way of life? And where will it guide us in the post-pandemic future?
In , in Gateshead, England, a year-old grandmother named Jane Snowball sat down in her armchair and used her television remote control to place an order of margarine, cornflakes and eggs. Aldrich took her TV and turned it into a computer terminal: she used the Videotex technology to generate a shopping list on her TV screen, and her order was phoned in to her local Tesco. The goods were then sent to her door, like magic. Following this early grocery service, the next major innovation in the online shopping space is said to have occurred in , when a computer whiz called Daniel M Kohn, then aged 21, set up an online marketplace called NetMarket.
The first purchase? Today, Peapod is one of dozens of companies offering grocery delivery to customers in certain metro areas. Also in , Walmart acquired Parcel, a same-day, last-mile delivery company. Two months after that, Target said it was buying Shipt, a same-day delivery service. Kroger announced last May that it was partnering with Ocado, a British online grocer, to speed up delivery with robotically operated warehouses.
FreshDirect recently opened a highly automated ,square-foot delivery center and says it plans to expand to regions beyond New York, New Jersey, and Washington, D. The story of Peapod, which has had 30 years to perfect the art of online grocery delivery, suggests that making money will be a challenge for even deep-pocketed retailers like Amazon.
Peapod has more experience than any other online grocery-delivery company. Peapod itself nearly failed in before being rescued by the Dutch conglomerate Royal Ahold NV, which bought first a controlling interest and then the entire company.
The company has not been able to get enough people to buy groceries online to lower the costs of delivering them. Compared to groceries, clothes and electronics and dog food are incredibly simple to deliver. A company like Amazon keeps those products stored in a warehouse, packs them in a box, and sends them on their way through the mail or through its delivery contractors.
Imagine fulfilling an order that includes popsicles, avocados, a case of Coke, and tortilla chips. Now consider that the average Peapod order has 52 items. Because of these factors, it will always be cheaper for grocery stores to have customers come to them, and do all the work of shopping themselves, than it will be for the stores to bring the groceries to the customers, said Kodali, the Forrester analyst.
Peapod has tried to lower its overhead in a few ways. Peapod has figured out how to make the shopping part of online grocery delivery relatively fast, which means one employee can process dozens of orders in just a few hours.
Employees wear devices on their wrists that tell them on what aisle and shelf a product is located, and they load food into baskets efficiently, scanning bar codes. Workers get intimately familiar with where various items are located, allowing them to shop quickly. Delivery can be slow-going, too.
The most efficient grocery-delivery companies are really logistics companies. The company times how long drivers are sitting in traffic; how long they go between deliveries; how much time they spend with customers.
The popularity was short-lived, however, and several online shopping services faced bankruptcy. Over the next few years, some of them survived economic hardship to remain strong in the market, and today there are numerous online grocery retailers. Many market experts currently feel that online grocery shopping is a profitable concept and will continue to grow in popularity.
Grocery shoppers have local, national, and international options available to them. Some U. For those searching for unique, organic, or international products, there are stores that sell those products online, as well.
A grocery delivery service can be a convenient option for anyone, including the elderly and other people with limited mobility or a lack of transportation. Busy families also tend to take advantage of online grocery shopping services. When picking up an order at the grocery store, customers can usually specify a pickup window, which can be anywhere from 30 minutes at some stores to four hours at others.
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