Arvind Narayanan (arvindn) wrote,
Arvind Narayanan
arvindn

Would you buy groceries online?

Pretty much the only positive thing for me about physically going to the grocery is the dating potential. Other than that, I buy the exact same healthy shit every single time, and I'd much rather do it sitting at home than wasting half an hour at the checkout counter. In other words, if there were a reasonably priced online grocery serving my area, I'd sign up in a hurry.

It's a tragedy that everybody's favorite whipping boy Webvan was started at the height of the dot com boom; that doomed it to failure. I'm pretty sure that if Webvan were founded today, they'd have a real shot at success, because a number of things have changed since then: higher web penetration, better inventory management systems and tech like RFID, and most importantly, much better recommender systems and targeted marketing technology that would offer a valuable secondary source of revenue through the web interface.

Even given that Webvan was founded in '98, it could still have succeeded had it not made some spectacularly bad decisions. From the wikpiedia page:
Webvan placed a $1 billion (USD) order with engineering company Bechtel to build its warehouses, bought a fleet of delivery trucks, purchased 30 Sun Microsystems Enterprise 4500 servers, dozens of Compaq ProLiant computers and several Cisco Systems 7513 and 7507 routers, as well as more than 80 21-inch ViewSonic color monitors and at least 115 Herman Miller Aeron chairs (at over $800 each).
They poisoned that market for everyone—nobody is going to fund an online grocery startup for perhaps the next decade or so. There are a number of small players left, but none that can reap the benefits of the economy of scale and compete with brick and mortar chains. And they all have crappy web-1.0 era style interfaces that hurt my eyes.

Would you buy from an online grocery? Why or why not?
Tags: economics, startup, technology
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