As grocers double down on ecommerce,
competitive pressure mounts for Publix
Ashley Gurbal
KritzerSenior ReporterTampa Bay Business Journal
At first blush, Safeway's launch in South Florida is a
blip in the local grocery market. It's only one store in Oakland Park — one of
only three in Florida.
But one facet of Safeway's Florida debut is particularly notable
for the industry. The new stores — all three of which are rebranded Albertsons
— launched with online shopping and one-hour delivery service, via refrigerated
trucks "with multiple temperature zones, so frozen items stay frozen and
vegetables are crispy fresh when delivered."
Safeway's fleet of refrigerated delivery trucks hits the road.
COURTESY OF SAFEWAY
Safeway's delivery fleet gives the company far more control over
grocery quality than if items were delivered by a third-party service.
Publix Super Markets Inc. doesn't offer
online shopping, though it does offer online ordering for bakery and deli
items. Publix customers in some cities, including most of the Tampa Bay region,
have access to grocery delivery via Shipt, though Shipt has no formal agreement
with the grocer.
Lakeland-based Publix was a pioneer in online grocery shopping
in the late 1990s, but pulled back from those efforts when they weren't as
profitable as projected. But it's becoming increasingly clear that Publix will
likely launch some sort of online shopping program in the near future — if only
to keep up with some of its largest competitors.
Kroger Co. (NYSE: KR), based in
Cincinnati, beat analyst estimates last week as it expanded its online shopping services. Kroger
is one of Publix's biggest competitors outside of Florida, in metro Atlanta and
the Carolinas.
Publix's main competitor in Florida, Wal-Mart Stores Inc. (NYSE: WMT), toutedits success with digital and ecommerce
initiatives in early June. Walmart hasrolled out online
grocery shopping with curbside delivery at several stores throughout Florida,
including one in Tampa.
Amazon.com Inc. (NASDAQ: AMZN) is
becoming more of a threat to traditional grocers, between its Prime Now one- and two-hour delivery
services and rumored private label products.
Publix is revered for its innovative culture, so it will be
interesting to see when and how the grocer tackles online shopping. And when it
does, it's likely to have a ripple effect across multiple industries — it could
eventually affect everything from the footprint of its physical stores to its
supply chain.
"They sleep with one eye open about this stuff," David
Livingston, a Wisconsin grocery analyst, previously told the TBBJ about Publix and
ecommerce. "They don’t totally ignore it. Publix I can see eventually
being good at this."
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