It's just like Amazon Prime, except all the prices on Amazon aren't inflated by a ludicrous markup when compared to other online stores. (On top of a delivery fee or annual subscription.)
Mehta, in a call with TechCrunch, stated that simply tacking on new cities to his company’s service doesn’t, in a sense, prove much; that’s just hiring.
I think the whole idea behind geographic expansion is that it proves more people are willing to pay for service X or Y than just those living in the Bay Area, who are perhaps the most amenable cross-section of the country for a service like this.
(Not advocating expansion for expansion's sake -- I think Instacart is making a wise choice -- but saying "It's just hiring" is disingenuous.)
New York is probably even stronger than the Bay Area for this kind of service, but there are entrenched competitors there.
College campuses, big industrial parks, and maybe military bases would be my next pick after NYC and SFBA. Another interesting market might be events -- during Sturgis, or Oshkosh, or other vents, running something like Instacart would work, while it wouldn't work in the same towns otherwise.
Instacart is a neat concept, but knowing that they charge more on items than the store charges irritates me enough that I don't use it.
I'd rather pay a clear delivery fee and not feel that I'm paying extra for every item than have free delivery but a mark -up on every item. I know that financially it might come out to the same thing, but psychologically I get annoyed that they charge me $4.99 when Trader Joe's charges $3.99.
I'm hoping they hit the scale where they can take some of their margin from the store (Trader Joe's specifically). Instacart Plus is a step in the right direction there.
In testing, Express members ordered from Instacart, again according to Mehta, two or three times weekly. The caveat to the Express deal is that delivery is only free on orders over $35.
So Express members are spending $70-105+ per week on groceries? I guess Instacart must be a hit with families.
For those kinds of users who spend $280-$420 per month on groceries, $99/year is relatively small.
Napkin math is saying that you'd only have to purchase thirteen orders a year (13 * 7.99 = roughly 104) at above $35 each to recoup your investment. Even for someone living alone, that's very easy to do.
No; did you read the article? AmazonFresh does not offer benefits at a yearly fee similar to Prime. The closest thing it has to that is extra benefits for those who purchase $300 in a certain time frame (Big Radish).
Perhaps you're in the express beta the article mentioned? I used Instacart a few times, and always had to pay the delivery fee unless they sent out a newsletter offering free delivery for one day for orders over ~$80 (which seems to happen a lot).
The author of this piece doesn't seem to know much about Amazon's product offerings. Prime is free 2 day shipping along with some free video streaming. Fresh is the Grocery delivery service.
Prime is a subscription you pay in exchange for free shipping from Amazon, and Express is a subscription you pay in exchange for free shipping from Instacart. Offering such a subscription had a positive impact on revenue-per-customer for Amazon, and Instacart may benefit from the same. The author seems to have made a fine analogy to me, and the fact that Amazon also has a separate grocery delivery service is completely tangential to his point.
