Dive Brief:
- Web-based grocery service Instacart is testing a pickup-only option for customers to retrieve their own orders at participating stores instead of using Instacart's signature home delivery methods.
- Instacart has been experimenting with the pickup-only option with a California grocery store since April and in other locations, and last week launched pickup-only service through a Whole Foods store in New Hampshire, Fast Company reports.
- Whole Foods CIO Jason Buechel said he believes that the new Instacart option will evolve beyond its current pilot program status, as research has indicated strong interest among customers.
Dive Insight:
Instacart has not been shy about continuing to tweak its approach to getting online grocery orders to customers' doorsteps. Early on, it used Uber for delivery of its completed orders, an idea that proved prescient, considering that Wal-Mart just announced it would use ride-sharing services for grocery delivery.
Yet Instacart eventually moved on from Uber delivery to rely on individual shopper-couriers who visited stores, prepared the orders and delivered them themselves, and later placed Instacart shoppers in stores who received orders, shopped and handed completed orders off to a separate group of couriers for delivery.
Now Instacart is going a route increasingly familiar to many retailers—buy online, pick up in-store (BOPIS). Its new experiment in BOPIS comes with a couple twists: It's a pickup-only offering, with no delivery option, and relies on individual stores preparing the orders themselves, without involvement from Instacart shoppers.
On the face of it, pickup-only could make more economic sense to Instacart, which wouldn’t have to employ its own in-store agents. It could also make more sense to Instacart store partners, whose own employees arguably could fill orders from their own shelves more efficiently than Instacart shoppers. Meanwhile, Instacart remains as the go-between, accepting and managing the customer order and the resulting transaction. A pickup fee is still charged: Instacart and its partners have not divulged the financial terms of their arrangement, but presumably it is less than standard Instacart delivery fees (which start at $5.99 in most cities).
BOPIS has both its benefits and bumps, though it's clear an increasing number of retailers are turning to the option to improve the shopping experience for customers who want to order items from the comfort of their own Internet devices, but don't want to wait days on end for their purchases to be delivered.
It remains to be seen how thoroughly Instacart and its grocery store partners will commit to Instacart's version of BOPIS. "The research indicates interest," Whole Foods' Buechel told Fast Company. "The pilot will evolve." Instacart views pickup-only as a "product extension," which could mean it isn't quite ready to move beyond grocery delivery just yet. Ultimately, though, it may be up to Instacart's customers and its store partners to decide how soon that could happen.
