Will Online Shopping Be the Death of Grocery Stores?

Stop me if you’ve heard this one before: New technology is the death knell for a pillar of society’s infrastructure and will disrupt an industry worth billions of dollars.

Wherever you vacation this summer, there’s likely to be a grocery store. Until recently food delivery technology has remained relatively stagnant, with large stores’ services like Peapod remaining unchanged.

Recent developments in smart appliances and the internet of things, alongside digital natives aging into their years as primary household food shoppers, is attracting a flood of venture capital into food technology. New money is nurturing a bumper crop of fresh grocery delivery ideas that may be a shot across the bow for the supermarket industry, or may be its savior.  The rub: Grocery tech must feel human, comforting, and intuitive, like the very act of eating, in a way that other commerce doesn’t require. Shopping is the foundation of home and hearth for singles and families alike. Whether Chinese takeout or non-perishable ingredients, when food is delivered everyone wants to feel like the bag contains care and love, because humans’ earliest food associations are inextricably wrapped in those two qualities.

Photo of a shopping cart in a grocery store.

Photograph by Matt MacGillivray

Dread Grocery Shopping? Buy Online

But grocery shopping is a drudgery chore for some, and requires a significant amount of pre-planning to be meaningful for the days ahead—consideration of family preferences and schedules turns into meal planning, which turns into a grocery list, which turns into a shopping trip, which turns into unpacking and kitchen organization, which turns into turning ingredients into meals. Repeat. No matter what food television tells you, inspiration doesn’t often strike at 6:15 p.m.

Combine grocery shopping’s perceived monotony and inefficiency with websites and apps that automatically place online orders for recipe ingredients based on our preferences, and our modern excitement over immediate delivery of everything from shoes to art. The result: lots of buzz that brick-and-mortar markets will become a titillating hat tip to the past, like the community water well. Because many online grocery delivery services skip the grocery store entirely, sending food straight from a warehouse. With fewer purchases from grocery stores, fewer grocery stores would exist.

As some wring hands over what a dearth of grocery infrastructure will mean for the digital have-nots, Instacart, a two-year-old company operating in nine cities, may have a profitable and workable blueprint for all. Place a grocery order on Instacart and pay a delivery fee, and one of Instacart’s army of freelance shoppers heads to a brick-and-mortar store, or a few different stores if you request, and quickly delivers fresh food to your door. Unlike other general delivery services, Instacart is grocery-specific, so the shopper has been vetted for the ability to give the care that food requires. Also unlike other grocery delivery services, Instacart allows the user to choose from among several grocery stores, from local independent stores to Costco.

Photo of an old grocery store.

Customers shop for groceries in Tulsa, Oklahoma during the 1920’s. Photograph courtesy Janice Waltzer

The Concept of the ‘Supermarket’ is Ripe for Change

Instacart’s business model isn’t threatening on a policy level because it doesn’t compete with society’s objective to support fresh food’s availability. It still brings foot traffic into brick-and-mortar grocery stores. By contrast, food delivery straight from a warehouse becoming the rising trend might have a chilling effect on the number of grocery stores, thereby increasing food deserts. Instacart additionally creates flexible jobs by paying freelance shoppers by the hour.

Grocery stores would be wise to welcome industries like Instacart. The stores understandably want customers wandering through their aisles and making impulse purchases, neither of which is possible with Instacart’s paradigm. (Or, rather, some tech genius will figure out a new virtual way to “wander aisles.”) But most stores also collect significant money from food manufacturers who pay fees for preferred product placement at eye level or at the ends of aisles, where you’re more likely to purchase those items. Instacart’s model keeps that revenue stream in place by keeping a store’s foot traffic the same.

The supermarket as we know it is about 75 years old, having replaced a system of smaller markets, so it may be ripe for change. With grocery stores in decline, digital-haves could turn to services that deliver groceries from warehouses that are not open to individual shoppers, supplementing at times with visits to high-end markets and farm stands for traceable food from trusted sources. On the other end of the spectrum, large stores like Walmart and Target would likely gain the huge share of grocery dollars, entirely squeezing out readily accessibly grocery stores. As food technology careens ahead, buyers are wise to ponder how our meals affect the lives of the 7 billion with whom we share our planet—not just what we purchase to eat, but how we purchase it.

This story is part of National Geographic’s special eight-month Future of Food series.

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