Google and Amazon want to deliver your groceries(Read article summary)
Google is set expand its testing of a home grocery delivery service, with trials coming to San Francisco and one other unnamed US city later this year.
Google wants to deliver fresh groceries to your home.
The world’s predominant search engine company and emerging self-driving car proprietor is now looking to be a major player in the food delivery game. Google is set to test their new grocery delivery service this year in San Francisco and one other city, which has not been named yet.
The new service will test offering home delivery for groceries, an expansion of the already established Google Express, which offers delivery of non-perishable goods from stores like Target and Fairway Market in select areas throughout the United States. Google will be partnering with a variety of grocers for the duration of their test, including giants like Whole Foods and Costco. These partnerships free Google from having to operate its own warehouse, which the tech giant hopes will keep delivery prices lower for consumers.
"It’s in our incentive, as well as the merchant’s incentive, for us to help customers get the full store delivered to them," said Brian Elliott, general manager of Google Express, in an interview with Bloomberg.
The food delivery industry has recently been inundated with companies launching their own systems. FreshDirect, Instacart, Peapod, and, most notably, AmazonFresh all offer similar services. Uber and Gett, two popular ride-sharing apps, have also made smaller ventures into the delivery game.
The Google test signals a new front of competition for the growing rivalry between Amazon and Google. “Many people think our main competition is Bing or Yahoo. But, really, our biggest search competitor is Amazon,” Google chairman Eric Schmidt said at an event in Berlin in October of 2014.
Food delivery is not the most obvious battleground for the online giants, but it presents a huge opportunity. Even in its early stages, grocery delivery is already $10.9 billion industry, according to Bloomberg. A December report from Ibisworld projects industry growth at 9.6 percent through 2019. Amazon and Google both have the potential to disrupt large portions of the market.
It is unclear what Google's new service will look like or how it will differ from the competition. Amazon has taken several approaches in its short time in the delivery business, including briefly-rumored drive-through grocery stores. Uber, when it was still offering its uberESSENTIALS service, promised delivery in 10 minutes or less.
Google Express, the delivery service for non-perishable goods, has been available in Boston, Chicago, Los Angeles, San Jose, Washington D.C., and New York. Today the service was expanded in the Midwest to cities including Grand Rapids, Lansing, Battle Creek, Kalamazoo, and Mt. Pleasant. The expansion might signal a growing ambition for Google's future delivery services.