The Branded Pantry

Amazon announced that they are expanding their local online grocery delivery (and pickup) service in the Seattle area to additional neighborhoods. This “experiment” is reportedly doing very well as consumers are evidently quite pleased with the full grocery service including perishables (produce, meat and bakery) offered by Amazon.

In the new neighborhoods Amazon is offering free produce as an incentive for new customers to try out the service. Many of the pioneer online grocery providers such as Peapod, Fresh Direct, Simon Delivers and the bricks and mortar grocer’s serviced by SAAS provider MyWebGrocer, have used this “free perishables” incentive for many years when they open a new territory.

Early on, online grocery service providers thought consumers would resist using online services because the consumer would then not be able to touch, smell, thump and see up close the produce and meat products that make up a big chunk of their weekly grocery shopping basket. Some early research we did, indicates that the % of consumers who were resistive of online grocery shopping due to this need to “experience” the perishables was relatively low. In fact, most in-store grocery shoppers today don’t know much about how to judge superior produce, meat, fish or bakery products. Next time you are in-store, spend a few minutes watching folks under the age of 40 in the produce aisle, and you will see this for yourself.

Still, the perishable give-away that Amazon is using, is a tried and true promotion tool for older online grocery providers. The reasons it works include the facts that almost everyone consumes perishables, that the experience of pleasant looking produce that is tasty and fresh creates a good impression of the store, and that these items are typically relatively high value. So….it works!

Amazon is often criticized by bricks and mortar retailers for ignoring the “traditional wisdom” of the old ways. In this case, the new dog made good use of some old tricks.