Crain's Chicago Business has a piece about Ahold-owned Peapod and its co-founder/chief technology officer, Thomas Parkinson, focusing on what the company is doing to prepare for what is likely to be ramped-up competition in the e-grocery sector from the likes of Amazon and Walmart.
The story says that Peapod "is branching out into office food deliveries, opening a downtown Chicago office to lure tech talent, expanding its warehouses here and on the East Coast and turning former bank branch offices and Starbucks into free pickup sites for customers who can't commit to a two-hour delivery window.
"Peapod … also is starting to deliver office supplies and other bulk orders to businesses. (Parkinson) says the Skokie-based service ultimately wants business-to-business deliveries to account for as much as 30 percent of overall revenue."
Parkinson says that office orders "are much bigger and more consistent—usually weekly—so we get a lot of revenue out of the business. The sweet spot for us is small to mid-sized companies that provide food for employees, like trading companies that don't want traders to leave their desks in the middle of the day."
He also says that Peapod's "biggest fear is (Amazon's) not caring about not making money. They've proven time and time again that they're willing to spend a lot to gain customers. It's going to be a good fight. The highlight for me is how fast we're growing and the investment by Ahold. They know we have to build out now to get ahead."
The story says that Peapod "is branching out into office food deliveries, opening a downtown Chicago office to lure tech talent, expanding its warehouses here and on the East Coast and turning former bank branch offices and Starbucks into free pickup sites for customers who can't commit to a two-hour delivery window.
"Peapod … also is starting to deliver office supplies and other bulk orders to businesses. (Parkinson) says the Skokie-based service ultimately wants business-to-business deliveries to account for as much as 30 percent of overall revenue."
Parkinson says that office orders "are much bigger and more consistent—usually weekly—so we get a lot of revenue out of the business. The sweet spot for us is small to mid-sized companies that provide food for employees, like trading companies that don't want traders to leave their desks in the middle of the day."
He also says that Peapod's "biggest fear is (Amazon's) not caring about not making money. They've proven time and time again that they're willing to spend a lot to gain customers. It's going to be a good fight. The highlight for me is how fast we're growing and the investment by Ahold. They know we have to build out now to get ahead."
- KC's View:
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Very smart. The competitive road is only going to get more crowded, and so companies like Peapod have to find ways to get out ahead of the pack.
