June 17, 2022
Super-fast delivery startups that have proliferated in the United States and abroad may have gotten ahead of the game, according to a new study that finds demand for the service just isn’t there. so important.
Just 2% of 1,000 U.S. shoppers polled in a new Stor.ai survey said they were “very likely” to pay extra to have their groceries delivered within 15 minutes. On the other hand, 57.5% said they would definitely not pay a fee for the service, Forbes reports.
A Stor.ai representative said the results demonstrate that customers are prioritizing execution over fast delivery. Twenty-seven percent of respondents said they would use superfast services more if the user experience improved. Twenty-two percent complained of out-of-stocks being the worst problem encountered when using delivery platforms.
This survey isn’t the first indication that super-fast delivery might not appeal to a large customer base.
Two super-fast delivery startups in New York closed in a single week in March, raising questions about the long-term viability of the model.
This week, Fridge No More, a free super-fast delivery startup, closed its doors for good after a failed acquisition attempt, according to CNN. This happened days after Buyk, a startup with a similar model, shut down operations altogether. The Russian-based company said bridging funding difficulties caused by U.S. sanctions on Russia were the reason for the shutdown.
Gorillas, the Berlin-based super-fast delivery startup, announced in May that it would lay off about half of its office workforce globally, according to modern shipper.
And startup Jokr has just announced that it will be reducing its operations in the United States to focus on business in Latin America, according to Morning infusion.
Even apparent leaders in the space like GoPuff are slowing down after a period of rapid expansion at the start of the pandemic.
GoPuff began to scale back its warehouse operations in late May, closing or suspending operations at 22 of its 600 warehouses, all of which were experiencing low order volumes, according to The real deal. The startup also laid off 3% of its global staff in March.
DISCUSSION QUESTIONS: Do results such as those from the Stor.ai survey change how retailers should view their investments or competition from super-fast grocery delivery? What factors do you think are impacting the role fast delivery plays in the overall retail landscape and what form will the service ultimately take?
“Do results like the Stor.ai survey change how retailers should view their investments or competition from super-fast grocery delivery?”