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Wells Fargo yesterday released the results of a new study designed to evaluate how online grocery businesses "engage, inform, and interact with customers."

The big conclusion: "While a few companies offered some interesting features, such as a $12.99/month 'Delivery Pass' at Fresh Direct, occasion-based curated product suggestions at Google Shopping Express, shoppable recipes at Amazon Fresh, and barcode scanning at and Amazon Fresh, most companies are not effectively grasping how to translate the process of buying groceries from the offline to the online world.

"Additionally, we found that the aura of same-day delivery was often not a reality, with next-day more the norm in practice. We still believe that online grocery will be become a significant disruptor in the U.S. grocery industry over time, although current kinks at existing players suggest the dislocation might not be immediate and may perhaps buy the bricks and mortar grocery retailers a brief window in which to catch up (for those who are willing and able to invest)."

The winner in the study's estimation is New York-based Fresh Direct, described as "the overall leader in our study and the only player to score an average score of more than 4 out of 5, with the best blend of a grocery and digital mindset, in our view: high-quality merchandise, a large selection of local and prepared foods, great product photography, an easy reordering process, and category-relevant features like recipes, pantry suggestions and Buy Big (for bulk items). Fresh Direct requires only a $30 minimum order and charges $5.99 per delivery or offers attractive unlimited delivery passes ($12.99/month, $69/six months, $119/one year)."

Other major players ranked by Wells Fargo and Fluid, a digital commerce expert:

• "Amazon Fresh was not the clear leader, falling shy of our expectations in terms of the user and delivery experience, as well as product information, despite its apparent advantages in fulfillment and ecommerce. Product information is very sparse, which is surprising to us given its importance for food items and the extensive information on core product pages. Delivery windows were often next day and sometimes two days out despite the premise of same-day delivery. However, Amazon excelled in some areas, such as easy reordering, a powerful mobile site and app, and neat features like shoppable recipes."

• "Walmart To Go met or exceeded our expectations in some areas (quality of perishables, wide selection, low $30 minimum order, ease of checkout); but we found the browsing process to be very time consuming and same-day delivery was not always available. We also found the delivery process to be a bit awkward as the delivery person must enter the home and unload all items unless you pay extra for bags; but you still have to be home and receive the order (most others offer unattended delivery options)."

• "Google Shopping Express, unsurprisingly to us, excelled in search, product information, and reviews, but seemed to miss some more important grocery-/retailing-centric features such as quick reordering and personalized merchandising based on past purchases. The lack of perishables also remains an impediment. It was, however, one of the few companies we tested that actually had same-day delivery windows available."

• " ranked better than we expected and, in our view, did a good job of leveraging its grocery expertise and store base in some areas, such as the ability to view and reorder past in-store purchases online (based on club card history) and the ability to create notes for each item and indicate substitutions. However we found product pages to be underwhelming and, like Walmart, same-day delivery to be somewhat of a fallacy, with most time slots not available until the next day unless placed before 8:30am and same day typically not available until 8-12 hours after ordering."
KC's View:
I'm not really surprised that Fresh Direct is identified as a clear leader in this sector - it has been doing this for a comparatively long time and has a specific niche. I'd be more shocked if the Fresh Direct experience were less positive.

In the case of Amazon Fresh, let's be clear. The company's expansion will almost certainly be a rocky road, especially because from all reports, it is moving from a more personalized service in Seattle to a more algorithm-driven approach in San Francisco and Los Angeles. That will bring both positives and negatives.

I keep thinking that it might make sense for Amazon to acquire Fresh Direct at some point … it might be the kind of play that Amazon made when it acquired Zappos. It could learn a lot from Fresh Direct, and might also bring some efficiencies to the model. And, if it wants to go into New York, an acquisition might make a lot more sense than a ground-up effort.