Local delivery apps changing the face of grocery and restaurant industries

Wednesday, January 9, 2019

In 1962, the future was Jane Jetson, feeding her cartoon family with her automatic — albeit, gargantuan — dinner-making machine. She tapped a few buttons and in short order, the meal appeared, hot and ready.

That future, as it turns out, was not so far off. Tap a few buttons today on a smartphone, and you can have a meal or the ingredients for one brought directly to you. Delivery and pickup services are changing the way people eat — and fast.

In Cape Girardeau, Walmart shoppers now have a bright orange corner where they can pick up pre-ordered groceries, and both Aldi and Schnucks stores are partnered with the national startup Instacart to provide grocery delivered directly to customers’ homes.

Customers who want prepared meals can have their favorites delivered through services like the Cape Girardeau-based startup carGO, whose Carryout program includes nearly 50 area eateries. While carGO started as a ridesharing platform, the company soon implemented food delivery, as well as alcohol delivery, and those services now outpace the company's rideshare operation.

“Food delivery is by far the largest part of carGO today in Cape Girardeau,” says co-founder James Stapleton. “To put it in perspective, in Cape Girardeau so far this year we’ve made about 112,000 food deliveries … and completed nearly 25,000 rides in the past year.”

As the company has branched out into other nearby markets like Poplar Bluff and Carbondale, Illinois, a similar pattern has emerged. Since the markets aren’t major metro areas, there aren’t as many non-car-owning commuters, Stapleton says.

“But everybody eats two or three times a day,” he says.

And judging by the numbers, customers have grown accustomed to the convenience delivery offers.

“All of this is about convenience. And once people see how convenient it is, they continue to use it,” Stapleton says. “Some people use our Carryout service multiple times a week.”

But customer trends and delivery services are only two legs of the stool; the rise of delivery is making it easier for people to spend money at retailers and local restaurants.

Where once the delivery options were limited to Chinese or pizza, now smaller regional restaurants can cater to their patrons in their living rooms.

“To state the obvious, the restaurant industry is very competitive. And restaurants are looking for any way they can add volume to their business. Delivery gives them another option,” Stapleton says. “Our customers purchased over $2 million of food from our local restaurants (during the past year).”

On the grocery side, although Instacart representatives were unavailable to comment for this story, a Nielsen study from the Food Marketing Institute predicts the online grocery market could hit $100 billion by 2022. The study called 2017 — which saw Amazon’s purchase of Whole Foods Market — a “year of disruption” that moved the existing forecasted timetables up by nearly half.

“Many retailers and manufacturers are not ready for the age of online grocery,” the study’s authors write, adding that neither affluence nor age are keeping people from migrating to online shopping, and that the trend will likely extend to grocery buying.

“A lot of people mistakenly think this is a thing that only young people use, and that’s just not the case,” Stapleton says of the carGO Carryout service. “It’s pretty evenly distributed over several customer personas, one of them being active families. … We also have older customers for whom it’s not as easy to get out. So it’s a pretty diverse age group.”

And the current rate of adoption suggests the trend is here to stay. How we get our food will surely continue to evolve — autonomous vehicles, anyone? — but in the meantime, feel free to have it your way.