Amazon’s Battle to Break into the Grocery Market

If Amazon can&#x27;t be trusted to sell genuine memory cards, Apple accessories or even books now, I wouldn&#x27;t buy baby food from them.<p><a href="https:&#x2F;&#x2F;twitter.com&#x2F;billpollock&#x2F;status&#x2F;844030960333152256" rel="nofollow">https:&#x2F;&#x2F;twitter.com&#x2F;billpollock&#x2F;status&#x2F;844030960333152256</a><p><a href="https:&#x2F;&#x2F;9to5mac.com&#x2F;2016&#x2F;10&#x2F;19&#x2F;amazon-fake-apple-chargers-cables&#x2F;" rel="nofollow">https:&#x2F;&#x2F;9to5mac.com&#x2F;2016&#x2F;10&#x2F;19&#x2F;amazon-fake-apple-chargers-ca...</a><p><a href="http:&#x2F;&#x2F;247wallst.com&#x2F;consumer-electronics&#x2F;2016&#x2F;12&#x2F;05&#x2F;amazon-memory-chip-scam-may-destroy-consumer-data-photos&#x2F;" rel="nofollow">http:&#x2F;&#x2F;247wallst.com&#x2F;consumer-electronics&#x2F;2016&#x2F;12&#x2F;05&#x2F;amazon-...</a>

<i>“It takes a lot of time and experimentation to work through unpredictable scenarios like a child picking up an item or a person wearing sunglasses or a face muffler,” he said.</i><p>This is funny. Because these aren&#x27;t unpredictable scenarios at all in a grocery store, unless you are having to write software to deal with them.

Amazon needs to get a lot better at selling people complimentary goods. Once I buy something, I frequently see multiple advertisements for that exact product. Why can&#x27;t they develop a database of products that compliment each other and so when someone buys a kitchen tool, they start advertising cookbooks.<p>Example: &quot;On Prime Day, Members purchased over 215,000 Instant Pot 7-in-1 Multi-Functional Pressure Cookers&quot;<p><a href="http:&#x2F;&#x2F;www.cnbc.com&#x2F;2016&#x2F;07&#x2F;13&#x2F;amazon-prime-day-is-biggest-day-for-online-retailer-ever.html" rel="nofollow">http:&#x2F;&#x2F;www.cnbc.com&#x2F;2016&#x2F;07&#x2F;13&#x2F;amazon-prime-day-is-biggest-d...</a><p>If you have a database of 100s of thousands of people who all are suddenly looking for recipes and raw materials for a pressure cooker, why not advertise to them?

I know this discusses a few strategic plays Amazon is making but shortfalls of the self-checkout project (AmazonGo) are interesting:<p>&quot;In its video touting Amazon Go, the company said it was aiming to open the site to the public in “early 2017,” and it hasn’t provided an update to that timing. But the technology has been crashing in tests when the store gets too crowded and requires human quality control, people watching video images to make sure customers are charged for the right things, according to a person familiar with the plan.&quot;<p>Not super familiar with image recognition but do you think that&#x27;s just a failure of the training data set or a much more complex technical problem?

Grocery net profits are 1.7%.<p><a href="http:&#x2F;&#x2F;www.fmi.org&#x2F;research-resources&#x2F;supermarket-facts" rel="nofollow">http:&#x2F;&#x2F;www.fmi.org&#x2F;research-resources&#x2F;supermarket-facts</a><p>Amazon barely makes money on retail operations. What is their rationalization in getting into this market?

&gt; Workers at Amazon Fresh, the company’s grocery-delivery business, threw away about a third of the bananas it purchased because the service only sold the fruit in bunches of five, the student concluded. Employees trimmed each bunch down to size and chucked the excess.<p>If anyone was wondering about the bananas, the paper (<a href="https:&#x2F;&#x2F;dspace.mit.edu&#x2F;bitstream&#x2F;handle&#x2F;1721.1&#x2F;99025&#x2F;921306927-MIT.pdf;sequence=1" rel="nofollow">https:&#x2F;&#x2F;dspace.mit.edu&#x2F;bitstream&#x2F;handle&#x2F;1721.1&#x2F;99025&#x2F;9213069...</a>) says (pg33) that after it was identified, they switched to selling 2lb bags of bananas, which the banana growers were already able to provide, so they scrapped the whole exactly-5-bananas-and-tear-to-make-fit.<p>&gt; In addition to the obvious financial impact of this, many Associates found the process frustrating since it was highly repetitive, and they did not feel they were creating value for the customer<p>Well, that&#x27;s one way to phrase it.

i&#x27;d love it if they could do this in a way that ensures quality. my biggest problem with amazon currently is even with things as simple as cologne or cookware, you can&#x27;t tell if what you&#x27;ll get is real or a cheap knockoff.

<p><pre><code> It lures inventors and retailers with shopping volume and frequency, and then sinks them with low margin. </code></pre> That is really the only quote you need to read.<p>Grocery margins are razor thin. Local&#x2F;Regional competition is insane.

IMO every company&#x27;s approach to the problem is completely wrong! You don&#x27;t try to offer online the same items that local stores sell off the shelf. Instead, treat the online outlet as an interactive test-market.<p>Walmart and Amazon are both in a great position to do this! Setup an online store that allows established customers to suggest items that they are unable to find on local store shelves. Allow them to also flag other submitted items as interesting. You have a curation staff that fleshes out submissions with images and descriptions before they go live. The company&#x27;s merchandiser evaluates the balance between interest in an item and the difficulty of its procurement. To aid in appropriate pricing, perhaps the system also requires submissions to include a reference to the most similar item that is already stocked on store shelves. Because the company is offering exclusive access to the items the profit margins can be kept high.<p>From what I&#x27;ve experienced product selection in US stores is in general far better than even the same store in Canada (including Walmart), but there might still be a few items not stocked in local stores that people will pay a premium for!

Sort of wish they&#x27;d focus on what they already have first. I mean I get it, it&#x27;s a good market to get into ...but.. how about - making a single login for abebooks fr, uk, com, etc.. that aligns with your main amazon account and - audible account. Why do I need maybe 7 different accounts on services owned by the same company? Better yet, how about taking the databases of books on sale at the various abebooks sub regional sites and put them on the main amazon.com page. I collect a lot of old cookbooks, and old lectures (Rede, Chichele, Ford etc) and often find that to find better deals than what is on amazon.com I have to go on different abebooks sites to find them. Also - have had experiences where I go on amazon fr or ca and order a cookbook easily purchasable on those sites vs .com site. It&#x27;s terribly aggravating! So I just wish they&#x27;d focus on making that easier to deal with before venturing onto other areas. That said, grocery should be decent.. I already hire taskrabbit individuals to do my shopping for me..they are hit or miss.. I never put them in charge of buying seafood..never.

A few things that Amazon could do better compare to Instacart:<p>- they bring you huge green boxes and often put only one or two items in each, they are highly unsightly and take up a lot of room, this must be part of their marketing campaign since it has Amazon written all over it, they ask you to return them the next time after their logo has been imprinted on every part of your brain<p>- sometimes they put ice bags in said boxes if you forget to take them out they melt and not all the boxes are water proof so water can run through them onto the floor and it can also spoil even if you take the ice out since it leaves the box moist<p>- not clear where they source their items, Instacart is clear if I want Wholefoods I select Wholefoods, Amazon seem to have way fewer options and not intuitively clear if I&#x27;m ordering from a store that I picked or getting random access grocery (RAG)<p>- they mention they have Belcampo as a store when navigating to it they only allow you to purchase sausages!!!

I&#x27;m not sure if Bezos and company know what they&#x27;re getting themselves into with the US grocery business. It&#x27;s a cut throat business which has not just some big players but several small to medium sized grocery chains (some as subsidiaries and some as stand-alone companies). And I can tell you as someone who&#x27;s work in grocery the profit margins are thin outside of the US holidays. Frankly, if Bezos thinks this is going to lead to adding actual profitability to the delivery of their other products I&#x27;m not sure I see that possibility materializing under the guise of grocery stores and grocery delivery. I hope they have plans to retreat from that business when (not really if) Kroger and Walmart hammer them on the price. Otherwise, I can see them learning a painful lesson in the near future.

So, my problem with this: I can&#x27;t usually get things delivered in the same day I want them, and sometimes even the next day. There&#x27;s no slot available and so on.<p>I don&#x27;t really think out what I need days in advance. I&#x27;m like, &quot;oh, I&#x27;m out of... whatever, I&#x27;ll go to ShopRite today.&quot;

&gt; &quot;Online grocery is failing&quot;<p>I&#x27;m sorry to hear that, because Amazon Fresh is the greatest thing to happen to my family&#x27;s grocery shopping since we became a family. Seriously, we&#x27;ll the $40 dash wand to add stuff to our grocery list through the week, then I&#x27;ll sit down for 10 minutes and add some stuff from my wife&#x27;s meal planning, then boom - next day (or two, depending on when we want it) we have our groceries.<p>Never gotten the moldy strawberries mentioned in the article, and with a few odd exceptions, everything is cheaper than both the grocery store and target, which saves even more time With 2 store trips a thing of the past.

Physical supermarkets can still be really terrible. It always seems to take me over an hour to do my grocery shopping.<p>My idea to bring the industry into the 21st century would be take a similar route to Blue Apron et al, where all the ingredients are combined into a single package. The difference is that the work of preparation would be distributed to local restaurants looking to supplement their income, and people would just pick up their uncooked packages there. That would keep the cost down and scale well, while still being convenient for customers and allow them to cook new, interesting meals everyday.

It&#x27;s cool that they are trying to innovate here, but it seems like a weird area to focus on.<p>The high growth areas in grocery are things like prepared foods and produce. Owning the middle of the store to try to out-Walmart Walmart seems like a low-value proposition.<p>I&#x27;ve been using Amazon Fresh for a few months. The delivery aspect is awesome, but the rest of the business is pretty questionable. They cannot keep anything in stock, and I&#x27;m basically getting a week of groceries free every month because they cannot figure out that dropping a cantaloupe on top of a bag of Doritos and loaf of bread is a bad move.

At some pt I have to wonder, just because you can do something does that mean you should? I don&#x27;t really look forward to a future where Amazon is involved in every business possible. Especially if it&#x27;s Weyland-Yutani-esque and involved in cave exploration.

All the facial recognition stuff is extremely creepy. Who could think the internet version of privacy is a model for real life?

surprised they don&#x27;t operate the stores so as to sell other amazon items via kiosk or for pickup. similar to how grocery stores have pharmacies

I buy a lot on amazon, but groceries? I can&#x27;t see it happening. I really don&#x27;t want counterfeit Oreos.