The following is a summary review of an article, Amazon May Claim a Bigger Place in the Food Chain, posted at E-Commerce Times by Rachelle Dragani on June 6, 2013.
In the past, groceries were often delivered. That has waned these days in the time of “everybody has an SUV”, but Amazon could bring grocery delivery to a whole other level. The company is expanding its Seattle-based AmazonFresh service to LA and San Francisco. At this point I’d like to point out that at one point Amazon was a guy names Jeff selling books out of his garage. If he did it with books, he can probably do it with your Cheerios. If the service is a hit in those cities, AmazonFresh could roll into 20 more metropolitan areas — possibly including some outside of the U.S. — in 2014.
Amazon has a major share of e-commerce and is known for its innovation, so the relatively sparse grocery market is open for a firm with the know-how to close the gaps in that market
It is a huge target market, as people spend over 10% on their food – one of the largest repetitive expenditures in a family budget. Delivery might also be an in with the aging boomer market over the next two decades. Others have been doing it for years – Peapod was in DC when I was there 10 years ago and is still going strong.
Amazon can really take advantage of its brand – known for its amazing infrastructure that allows delivery what the consumer wants for a good value and as quickly as most any other alternative. There is also the potential advantage of no brick & mortar store – my opinion is that is a disadvantage for fresh goods & produce. I would personally use an online order and delivery service for my non-perishables. Then I could spend more time at home with the family and spend my grocery time at the farmers market or at local farms.
Here’s an audio version of my summary.