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Instacart in Talks to Raise $400M at $3B Valuation

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Re: Instacart in Talks to Raise $400M at $3B Valuation

#71

Post by martinald »

hkmurakami wrote: post #50
siliconc0w wrote: post #31

My theory is that the inability of US chains to figure out online ordering is really some anti-competitive agreement to force customers to go into the store because the chains live and die by high-margin impulse buys. Wholefoods just opened a brand new chain called '365' that has all sorts of sophisticated nonsense like a programmatic tea-bot and yet there is no online ordering. Even the made to order stuff is driven…

What about kickbacks for preferential shelf placement?

In the UK this applies to online stores too, some items are 'promoted' etc. Think of it like sponsored listings.

Re: Instacart in Talks to Raise $400M at $3B Valuation

#72

Post by ghaff »

JBReefer wrote: post #67
matthewowen wrote: post #17

Earlier quoted context omitted.

Because it's a terrible way to solve it and this company doesn't seem to be executing particularly well on it. I actually agree that online grocery shopping should be great. It's mystifying to me that it isn't: if you go to the UK, the experience is fantastic: order direct from the grocery store, easy to order, cheap and efficient delivery. I don't really understand why US chains can't do the same thing.

We do, it's a very successful service called Peapod that you haven't heard of because it's not used by people in SV. It's exactly what you're describing, but doesn't have a hugely PR engine because it's a profitable arm of an existing store that doesn't require a 10x exit.

And Peapod is actually the only delivery service I can get where I live.

I've used it when I was on crutches for a few months because of a broken foot. I didn't love it but it was better than trying to do a full grocery shopping when I couldn't walk.

In general, in the US, people mostly use delivery services if they can't easily go to the store and shop. Or if it's just a hassle because of kids, etc. I'm not sure if there are cultural differences from other places or it's just because, for most people in the US, hopping in a car and parking in the large supermarket parking lot just isn't a big deal.

In any case, it doesn't seem like a market that's ripe for disruption except in the minds of Silicon Valley types. Adequate services exist. It's just that very few people have an interest in using them.

Re: Instacart in Talks to Raise $400M at $3B Valuation

#74

Post by ghaff »

M_Grey wrote: post #69
ghaff wrote: post #63

Earlier quoted context omitted.

You'd be surprised. I live 35 miles west of Boston/Cambridge, and there are none of these delivery services. Last time I looked, Uber was available but it looked very thin--not something I could depend on for a morning appointment. All of these offerings decrease greatly in availability once you get beyond the central Metro areas of certain cities. Of course, I wouldn't use them much anyway. Assuming the thing being…

IIRC Roche Brothers now has a similar delivery service in that area now. I'm not sure if there are others, but I wouldn't be shocked.

I doubt it. Their nearest store is at least as far away as Boston is for me. (Doesn't seem to be a way to actually check without registering on their site.)

Re: Instacart in Talks to Raise $400M at $3B Valuation

#75

Post by omarchowdhury »

CPLX wrote: post #65
omarchowdhury wrote: post #49

Earlier quoted context omitted.

Instacart is building datasets right now on what people purchase. They can simply bypass their physical market place partners of today and become a retailer without the cost of running physical stores. They would only need to take care of fulfillment, and hey, maybe with machine vision there will be a little Instacart robot that delivers your groceries to you direct from the Instacart warehouse: cutting yet another c…

> Instacart is building datasets right now on what people purchase. Why do people say things like this as if Silicon Valley is the only place that's heard of collecting data on customers. You are aware that's what those supermarket savings cards with the barcodes do right? I guarantee you that Instacart has like the 178th best database of what supermarket customers purchase at best.

Of course, I'm only painting a scenario that I think likely is being posed by Instacart to justify their valuation and future prospect, not the superiority or effieciency thereof.

And there is a big difference between having access to a database of customer sales, and actually having those customers...

Re: Instacart in Talks to Raise $400M at $3B Valuation

#76

Post by [deleted] »

CPLX wrote: post #65
omarchowdhury wrote: post #49

Earlier quoted context omitted.

Instacart is building datasets right now on what people purchase. They can simply bypass their physical market place partners of today and become a retailer without the cost of running physical stores. They would only need to take care of fulfillment, and hey, maybe with machine vision there will be a little Instacart robot that delivers your groceries to you direct from the Instacart warehouse: cutting yet another c…

> Instacart is building datasets right now on what people purchase. Why do people say things like this as if Silicon Valley is the only place that's heard of collecting data on customers. You are aware that's what those supermarket savings cards with the barcodes do right? I guarantee you that Instacart has like the 178th best database of what supermarket customers purchase at best.

[deleted]

Re: Instacart in Talks to Raise $400M at $3B Valuation

#77

Post by yesimahuman »

One interesting counter to Instacart are services like grocerkey (http://www.grocerkey.com/) that exist as whitelabel instacart's for stores. That local chain that everyone knows probably doesn't want to send all their customers to instacart if they don't have to. I'm not sold on Instacart being something people use outside of a few major cities, but maybe that's enough for them.

Re: Instacart in Talks to Raise $400M at $3B Valuation

#78

Post by ghaff »

Shivetya wrote: post #66
pj_mukh wrote: post #44

Earlier quoted context omitted.

All my nearby stores offer this, I still use Instacart. It lets me shop from any store, their QC is amazing, and living in a small apartment I need to make 2 or 3 $35 trips (instead of one big $150 trip) and that becomes free on Instacart (saving me close to 5hrs per week of drudgery).

I really don't see that as sustainable for them. The fifteen percent they mention on $35 is not very much to work with. I understand buying market share but all of these services seem to follow the same route, incredible lead in pricing and then trying to find out how to raise it without driving everyone to another solution. grocery stores usually can pull this off as they tend to have pharmacies they want you to use…

The problem with so many of these, what are effectively, personal services going back to the dot-com bubble is that they're effectively luxury goods for most people.

And unless they actually need them for some reason (lack of mobility, don't have a car, etc.) most people don't buy a lot of unsubsidized personal services. They don't have gardeners, lawn care, drivers, etc. Some do but it can be hard to build a business out of just them.

Re: Instacart in Talks to Raise $400M at $3B Valuation

#79

Post by M_Grey »

ghaff wrote: post #74
M_Grey wrote: post #69

Earlier quoted context omitted.

IIRC Roche Brothers now has a similar delivery service in that area now. I'm not sure if there are others, but I wouldn't be shocked.

I doubt it. Their nearest store is at least as far away as Boston is for me. (Doesn't seem to be a way to actually check without registering on their site.)

I see, and you're right I can't think of any other options in the area. MA is great for a lot of things, but the lower population definitely means it takes a hit for services you'd see in NYC, Chicago or SF.

Re: Instacart in Talks to Raise $400M at $3B Valuation

#80

Post by ghaff »

M_Grey wrote: post #79
ghaff wrote: post #74

Earlier quoted context omitted.

I doubt it. Their nearest store is at least as far away as Boston is for me. (Doesn't seem to be a way to actually check without registering on their site.)

I see, and you're right I can't think of any other options in the area. MA is great for a lot of things, but the lower population definitely means it takes a hit for services you'd see in NYC, Chicago or SF.

A lot of that kind of thing is available closer into metro Boston. But I'm out past any real suburbs and the small cities that are closer to me aren't the sort of places where people Uber and get Whole Foods deliveries.
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