Technology is enhancing local food systems. I’ve been watching the online grocery business for a few years. Farmers’ markets are amazing. They create a connection between farmer and consumer. The USDA estimates the number of farmers’ markets has doubled in the last decade to 5,700. In recent years, there has been a move to bring the farmers markets online.
A recent NYT piece featured some of the top players in this space. GoodEggs, backed by Sequoia and other top VCs, is one of the more interesting startups in the space. Unfortunately, they don’t deliver to Manhattan, so I haven’t had a chance to try the service. However, I have heard first hand accounts that it is awesome. There are other players in NYC, like Local Bee, similar to Good Eggs, and of course FreshDirect, which operates more like an upscale supermarket that incorporates local options when possible.
I think these online grocers are here to stay. Here’s why:
Convenience
I’m a big FreshDirect fan. The convenience of having your staples delivered on a day’s notice is amazing. You know what you’re getting with the company’s produce rating and wide selection of great food.
I’ve always loved to go to the farmers’ market, but there are times when I would love local vegetables, but stopping a the market is not in the cards. The demand for local food is there and these new players are filling a big consumer demand.
Cost
Most of these services operate in dense, urban areas. This eliminates major transportation costs that plagued Webvan. More importantly, online grocers have been able to increase customer retention. According to stats from Tesco, after ordering online three times, customer retention in online grocery is high.
User Experience
And this leads me to my final point. The user experience for FreshDirect and Good Eggs is delightful. When I flip through the Good Eggs site, I want it all! And FreshDirect’s experience is absolutely seamless. So the next time I want to make mom’s chile, all the ingredients are there from the last time I cooked this winter favorite.
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