As More Markets Go Online, Checkout Begins Behind the Computer
New York Times
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Print Media Edition: Late Edition (East Coast)
New York, N.Y.
Jul 16, 2000
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Authors: Cynthia Wolfe Boynton
Abstract:
Joe Porricelli Sr., vice president of the Porricelli food stores, sees
the Internet as an unavoidable part of his business. To ''compete with
the big guys,'' namely Stop & Shop and ShopLink, he offers Internet-only
coupons that can be used in the store. He updates his Web site with weekly
specials. He also became part of the Priceline network (the only independent
store to date) in March. The stores have also had to learn how to adapt
to Priceline. Like at other participating Priceline stores, the staff at
Porricelli's has had to learn how to handle prepaid Priceline items. (They're
rung up separately.) Butchers and deli staff have also had to get used
to that Priceline customers prepay for specific weights of meat and poultry,
so special orders or requests from these customers may be common.
Deb Paduda, with her Priceline list in her hand, at a Stop & Shop in Clinton.
She said she buys most of her groceries through the Internet. (Thomas McDonald
for The New York Times)(pg. 6); Above, Deb Paduda of Madison, with her
daughters, Erin, left, and Molly, shops for groceries using her computer
and, top, at the store with Erin. (Photographs by Thomas McDonald for The
New York Times)(pg. 1)
Deb Paduda of Madison, who has three children, said she buys most of her
groceries from Priceline and saves as much as $15 to $20 each time she
shops, which sometimes is as often as four times a week. Priceline customers
pay for the items online with a credit card, then go to a participating
store with a print-out of their order to pick them up.
Copyright New York Times Company Jul 16, 2000
Full Text:
AS far as Stew Leonard Jr. and other food store owners are concerned, the
Internet and its growing number of online home delivery services haven't
revolutionized grocery shopping. They've brought it full circle.
ShopLink.com, Peapod.com and Stop & Shop's new Fairfield County online
ordering and delivery service, among others, have brought the return of
pre-World War II days, when people commonly telephoned in grocery orders
to stores and then drivers delivered them.
''I grew up riding around on my grandfather's milk trucks,'' said Mr.
Leonard, chief executive of the Stew Leonard's stores in Norwalk and Danbury,
''and people loved that personal service.''
The difference now is that people are using the Internet to buy their groceries.
This use of technology to return to the past is catching on with consumers
to such a degree that more and more of the major supermarkets in the state
have begun Web sites.
ShopRite (www.shoprite.com), A.&P. (www.aptea.com), Waldbaum's (www.
waldbaums.com)
and Stew Leonard's (www.stew-leonards.com) all have Web sites. Stop & Shop
launched an online delivery service (www.stopandshop.com) late last month.
Many stores offer online coupons that can be printed out for in-store use.
And it's not just the big stores that are going online. Independent grocers
like Everybody's Food Market (www.foodtips.com/everybodys) in Cheshire
and the Porricelli Food Mart stores (www.foodtips.com/porricellis) in Old
Greenwich and Cos Cob, for example, have extensive Web sites.
Then there are the Internet sites that aren't built around stores, like
Stamford-based Priceline WebHouse Club (www.priceline.com). Its site allows
people to bid on the price they want to pay for groceries, which they then
get from existing supermarkets. There are also delivery services like
ShopLink.com,
Peapod.com and Ben & Izzy's (www.benandizzys.com) of Norwalk, which specializes
in organic produce.
''We want to go retro and bring people back to the time when neighborhoods
were visited by fruit and vegetable trucks,'' said Lee Chevron, who started
Ben & Izzy's in November 1998 and buys much of his products from Connecticut
farms for the 1,000-plus customers he has here. ''We want people to look
forward to our visits, and for everyone to have fun with it.''
Deb Paduda of Madison, who has three children, said she buys most of her
groceries from Priceline and saves as much as $15 to $20 each time she
shops, which sometimes is as often as four times a week. Priceline customers
pay for the items online with a credit card, then go to a participating
store with a print-out of their order to pick them up.
''I go through almost a gallon of milk a day and countless snacks and cereal
boxes each week,'' said Ms. Paduda, one of about 50,000 registered users
in the state. ''And when I save money on practical things like groceries,
I feel better spending on fun things like vacations.''
The potential for people to ease the stress in their life by buying from
an online delivery service, or saving money by buying at a discount, can
make online grocery shopping an exciting experience, said Brian Sansoni,
a spokesman for the Grocery Manufacturers of America in Washington, D.C.
But he said it's important for people to remember that the industry is
still in experimental stages for both shoppers and sellers. ''Internet
grocery shopping is in its infancy, and there are lot of kinks to be worked
out, the biggest being which of these business can make a profit and survive,''
Mr. Sansoni said.
Both online and traditional food stores have razor-thin profit margins
and must sell huge volumes to turn profits, he explained. Start-up and
delivery costs alone can be astronomical. So far, few online grocers have
even come close to breaking even.
Virginia Harte, associate editor of the Food Institute Report, a national
publication that tracks food industry trends for the nonprofit Food Institute
in Elmwood Park, N.J., said it's too soon to tell what long-term effects
the Internet will have on the way people grocery shop.
There's also no real accurate way to tell what kind of impact online delivery
and discount services are having on ''brick and mortar'' supermarkets,
she said. No one is reporting lost profits or a declined customer base.
That could be because actual online grocery sales are still small. Nationally,
only $200 million was spent at online food markets in 1999, less than 1
percent of the $440 billion in total supermarket sales, according to Jupiter
Communications, an Internet research firm in New York. And there's no clear
picture of what 2000 will bring.
According to Greenfield Online, a market research firm in Wilton, a lot
of people are also leery about trying it. Of more than 1,708 Internet users
the company recently surveyed, 31 percent said they had visited an online
grocery site. Of those who had, only 12 percent made a purchase.
About 62 percent said shipping or delivery charges made them not want to
cybershop, while 46 percent said that they didn't like the idea of not
being about to touch or see items they might want to purchase.
Dolores Bova of Milford is also turned off by the fact that most Internet
grocers require users to charge items to a credit card. Although she uses
the Internet regularly to communicate with friends and family, buy stocks
and research medical and travel information, she said online food shopping
is out of the question.
''Let's face it,'' she said. ''Interest charges can add up and at the end
of the year wipe out any savings you might have had from bidding on groceries
or buying specials,'' said Ms. Bova, 63. ''Besides, there's nothing like
picking out your own pear or tomato. How would a company know whether I
like my apples hard or over-ripe, my bananas soft or hard?''
There are also privacy issues. While brick-and-mortar grocery stores have
long logged shoppers' habits through the use of discount and loyalty cards,
customers can choose whether to use those cards. Online shoppers have no
such option. Everything they buy is logged and in most cases the information
is easily accessible by manufacturers.
ShopLink, which regionally delivers from a 83,000-square-foot warehouse
in Stratford and has more than 3,100 area families on board, shares customer
data with suppliers. But Jayne Fishkind, a psychiatric nurse of Guilford,
isn't concerned.
''Every time I use a credit card or a store card, I'm being tracked,''
said Ms. Fishkind, who said she uses ShopLink to save time. ''At least
with ShopLink, I'm being tracked at my convenience.''
Ms. Paduda's main gripe is with the limited number of brands available
from some online sites and the amount of time it takes to search different
categories to place an order, not to mention having to deal with slow modems
and site glitches from time to time.
But Joe Porricelli Sr., vice president of the Porricelli food stores, sees
the Internet as an unavoidable part of his business. To ''compete with
the big guys,'' namely Stop & Shop and ShopLink, he offers Internet-only
coupons that can be used in the store. He updates his Web site with weekly
specials. He also became part of the Priceline network (the only independent
store to date) in March. The stores have also had to learn how to adapt
to Priceline. Like at other participating Priceline stores, the staff at
Porricelli's has had to learn how to handle prepaid Priceline items. (They're
rung up separately.) Butchers and deli staff have also had to get used
to that Priceline customers prepay for specific weights of meat and poultry,
so special orders or requests from these customers may be common.
Mr. Porricelli said that Priceline sales are triple what they were the
first week there.
''Although I have to admit that Internet grocery shopping makes me nervous,''
he added. ''There was a time when you had to worry about a new grocery
store opening down the road. Now, you have to worry about the grocery stores
that are available in people's homes.''
Captioned as: Deb Paduda, with her Priceline list in her hand, at a Stop
& Shop in Clinton. She said she buys most of her groceries through the
Internet. (Thomas McDonald for The New York Times)(pg. 6); Above, Deb Paduda
of Madison, with her daughters, Erin, left, and Molly, shops for groceries
using her computer and, top, at the store with Erin. (Photographs by Thomas
McDonald for The New York Times)(pg. 1)
Reproduced with permission of the copyright owner.
Further reproduction or distribution is prohibited without permission.
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