Word on the street is that Amazon is delving into curbside pickup with a new concept, called AmazonFresh. AmazonFresh would be an upgraded version of BOPIS, where customers wouldn’t even have to leave their vehicle to pick up the goods. The idea is that customers could order online, then AmazonFresh employees would pack the customer’s order and bring it out to their vehicle.
Amazon reports that AmazonFresh curbside pickup orders could be available within 15 minutes of being placed.
Despite conflicting information from The Wall Street Journal and Business Insider, Amazon publicist Pia Arthur vehemently refutes claims that AmazonFresh plans to open 2,000 physical grocery stores over the next 10 years. “It’s absolutely not correct,” Arthur says. “We have no plans to open 2,000 of anything.”
In actuality, the AmazonFresh concept is still being tested and is currently only available to Amazon employees.
So, is AmazonFresh poised to give WalMart’s grocery business a run for their money? WalMart beat AmazonFresh to the punch with curbside delivery, since WalMart already offers curbside delivery at many of their already established physical locations. Plus, curbside pickup at Walmart is free, where AmazonFresh charges customers $15 per month and a $10 charge for orders under $40 for their delivery services. AmazonFresh curbside pickup may prove too costly to be a daily convenience.
Of course, cost isn’t the only factor customers take into account when choosing a grocer. The younger generation is rife with dietary restrictions, whether they eat organic-only, gluten-free, or vegan, and this is the market being targeted by AmazonFresh. According to Citi via CNBC, Whole Foods has the most to lose if AmazonFresh becomes a success. “Whole Foods has 60 percent of their stores overlapped with Amazon’s current or future delivery markets while Walmart is just 23 percent exposed.”
Although at first glance, AmazonFresh looks like the logical continuation of Amazon’s growing attempt to break into the 8 billion dollar grocery industry, the logistics of the enterprise may prove more complex than foreseen. Logistical issues listed by Bloomberg as deterrents to AmazonFresh include: cost, produce quality, and poorly trained employees were all l.
If not addressed, these setbacks may prove more costly and time consuming for customers than actually shopping at a physical store.
Another deterrent for AmazonFresh customers may be that the pilot lacks the capacity to address the growing trend for grocery stores to offer a dine-in experience. Contrary to popular belief, many Millennials and Gen Z customers value the in-store experience and shop where they do for the social element. Curbside delivery concepts such as AmazonFresh lack the communal dine-in capacity offered by full-store competitors like Whole Foods.
If Amazon is able to resolve these issues before AmazonFresh completes its beta phase and becomes available to the public, then the concept could prove to be an asset for time-crunched customers looking to avoid an in-store experience. In the end, the future success or failure of AmazonFresh will prove dependent upon quality of the food itself.
If staff is adequately trained to selectively pick and double-check produce before it is packaged and handed off to customers, then AmazonFresh will prove a lucrative time saver. However, customers may find it more difficult to dig through a bag of groceries to check produce quality in their car than to simply pop into a store where the produce is easily surveyable, so customers need to be able to trust what they’re given in order for the concept to work.
Jasmine Glasheen is a Freelance Writer and Retail Strategist. A panelist on RetailWire’s BrainTrust, Jasmine has been published on Retailwire, Independent Retailer, CART, and many others. She was formerly the editor of Off-Price Retailing magazine, and has been quoted both in Forbes and in RetailDive. When she’s not at her keyboard, you’ll find her guzzling kombucha or dancing like a maniac. LinkedIn | Twitter