It’s not the fall that kills you. It’s the landing, as they say.
Similarly, it may not be the price or product that breaks the retailer – it may be the last mile. The last bit of gap closed between corporate and consumer, and we mean this in the literal sense. The term applies to tech and telecom. For us, tech – yes, payments, too – and delivery can be a differentiator when it comes to service.
And when it comes to delivery, almost every company in most any vertical must contend with the 800-pound gorilla in getting things to doorsteps quickly – and this would be Amazon, of course. Speed and scale and shipping make for tough adversaries in the world of retail. But that doesn’t mean the game is not afoot (and since we are talking about delivery and logistics and the last mile, at times the game really is on foot).
Take the most recent announcement by one chain of health-conscious and organic food-focused supermarkets, which in this case is Sprouts Farmers Market. The company, as CNBC.com reported Tuesday, is gearing up to offer home delivery through Instacart. The partnership comes in the wake of Amazon’s renewed vigor aimed at food. Amazon, of course, gained scale in the edible arena with its $13.7 billion acquisition of Whole Foods.
Another commerce and eCommerce juggernaut, Walmart, bought a same-day delivery firm known as Parcel late last year, and serves five markets with Uber-enabled delivery. Target, of course, has bought Shipt in an effort to boost delivery of both grocery and non-grocery items.
Here comes the last mile, in large part writ small, at least for the last few announcements, as Walmart has those five markets and Sprouts operates in eight cities nationwide – through Amazon Prime Now – but starts, additionally, with Instacart in two markets in Arizona. The online grocery market share wars are fought over a $12.6 billion pie (mmmm, pie), and market research firm Packaged Facts predicts that the market will grow to $41.7 billion within just four years. Amazon has 18 percent of that market, Walmart has 9 percent and Peapod has 7 percent.
There’s room for jousting and jockeying, it seems, on the way to that last mile.
And, it seems, we’ve come a long way from Webvan. Now on-demand models hold sway – and right-sized, too. A few months ago, headed right into the holiday season, Amazon and Allrecipes began a literally granular approach to food. The pair offered the ability to order ingredients directly from recipes, paid via an Amazon account and delivered within the hour – thus, having a pinch in a dash. And in the end, as the grocery segment continues to grow, it is the dash that may matter as much as anything else.