Click Here for Tomatoes
We shopped online grocers across the country and found the prices comparable, the convenience unbeatable and the produce better than in the store. What's holding you back?
(MONEY Magazine) – Tony Stallone looks down at the large, deep red strawberry in his hand as if it were a prize ruby from a sultan's crown. Stallone works for Peapod, an online grocery-delivery service, near Chicago. His title is vice president of perishables, so for him a delicate strawberry does in fact have value beyond measure. "This is the most important item we sell," he says. "If customers receive mushy strawberries, they may never shop with us again." Online grocers have to work so hard to win new customers that any slipup--one bad strawberry, one late delivery--could send the recipient back to the store down the street. That's because grocery shopping is an intensely personal experience. You know the store's layout like you know your own kitchen, and the weekly food-buying ritual can bring an hour's worth of comfort and control--everything is in the same place every time, and your cart is your domain. You can spend as long as you want thumping for the perfect melon. You can instruct the butcher to give you the other steak, the one over there with a little less fat. After all, you're feeding yourself and your family. Why on earth would you trust a faceless being in cyberspace to pick out your fruits and vegetables for you?
Here's why: Tony Stallone and his counterparts across the country are better at it than you. What's more, Web technology lets you sort some items by nutritional information, so you can see, say, yogurt brands ranked by calorie count. Plus, online shoppers are shielded somewhat from the marketing tricks that supermarkets employ--the junk by the register, the free samples, the prime shelf space sold to the highest bidder. And because Web grocers have gone from being dotcom larks (remember Webvan?) to being legitimate businesses, they're spreading. Peapod operates in 15 markets around the Midwest and East Coast. FreshDirect delivers in New York City, Albertson's and Safeway serve the West (including California), SimonDelivers is in Minnesota's Twin Cities, and Schnucks covers St. Louis, Central Illinois and parts of southern Indiana. In all, they sell less than 1% of the nation's groceries, but their niche is growing faster than the grocery business as a whole, according to Jupiter Research.
Getting back to the produce: Online grocers tend to offer a higher-quality selection than what most stores dump on the shelves to be manhandled by stock boys and mauled by other customers. You can tap the cantaloupes and shake the zucchini all you want, but the stuff from the Internet will likely be better. "The public uses a lot of mysterious methods to pick out produce," says Stallone, who has worked in the business for 40 years. His technique is more scientific, informing the classes he teaches to the crews that assemble orders for Peapod's 160,000 customers. For example, you know those mist machines that shower vegetables with water to make them look fresh? Bad idea. "All that extra water makes the food look fresher, but it doesn't keep it fresher," Stallone sniffs. To illustrate his point, he walks into the Illinois warehouse's climate-controlled "pepper room," picks up a green bean and snaps it in half. "Hear that? We keep them dry and cool. Beans sitting in a misted store bin don't snap like that, and they won't taste as fresh."
Online pricing is, overall, about the same as it is in the store--sometimes you'll save a little, sometimes you'll pay a little more (plus delivery). We know because we tested eight online grocers across the nation. So what's holding you back? Only old habits.
One of the biggest drawbacks of going to the grocery store is the time (and gas) it takes to get there. So move the store into your den. Most testers found the sites easy to navigate; some have virtual aisles you can browse; others offer mere categories that make searching easy but browsing for inspiration difficult. Your first visit can take an hour or so (Bashas', in Phoenix, required a phone call upon initial setup, an extra step that was an annoyance), but after that the average trip up and down the "aisles" takes about 20 minutes, start to finish. Once you enter your information and click on a list of items you want, the site remembers your list for next time. It's like showing up at the supermarket to find that the manager has set aside all the goods you bought last time in case you need any of them again.
Once you're online, most sites liberate you from the advertising barrage found in stores, where nearly every square foot is designed to influence your choices. No end-of-the-aisle displays that scream promotional prices. No shelf space paid for by the companies whose products they hold. No circumnavigating to locate specialty items relegated to the low-rent ghettos of "ethnic food," "health food" and "gourmet" sections. And if you're susceptible to bakery sections where sweet aromas fill the air, you'll breathe easier at the keyboard. Most of the online groceries, especially Peapod, have kept their sites clutter-free.
Even better, some sites are designed to help you unleash the power of electronic data. Want to know which of the whole wheat breads on Peapod has the highest fiber content? Wondering which of the 29 kinds of frozen pizza sold at FreshDirect has the most sodium? At the store you'd have to study every box. On the websites you need only click the "sort" button.
One head of brown lettuce and a few bad bananas were about the only complaints any of our testers had about quality. There were hang-ups when it came to substitutions and availability--some stores use more common sense than others when deciding what you'd want if something is out of stock. (If they're out of Ben & Jerry's ice cream, would you want Häagen-Dazs instead? Not necessarily, but that's what our customer at Bashas' got.) When Bashas' delivered an order to our shopper in Phoenix, 11 items were missing. Peapod, meanwhile, only carries 80% of what its brick-and-mortar suppliers sell but shows you what will be substituted if your first choice is out of stock. Many stores alert you at checkout when a product is unavailable.
As for price, it's a wash. In cities, Web retailers save money on real estate (there's no physical store to rent, just a warehouse), which can mean cheaper food. Some suburban stores, meanwhile, simply pull items from their shelves, so their online prices are the same as, or a little higher than, they would be in the real store. Delivery fees range from $5 to $15.50 (for same-day service), not bad compared with how much it costs in gas to power a family SUV to the market.
Everyone has, at one time or another, wasted an afternoon waiting for a cable repair person. But online grocers don't give you eight-hour service windows. The delivery times range from up to four hours at Safeway in Los Angeles to 30 minutes at King Soopers in Denver. (Most stores offer one- to two-hour options.) Impressive, especially considering that some stores send their trucks on daily runs that are hundreds of miles long.
Speaking of trucks rumbling from house to house, damaged goods might seem a potential pitfall of online groceries. In our tests, it was a nonissue. Products are packed in sturdy containers, some of which double as coolers--Minnesota's SimonDelivers has containers that can keep ice cream frozen for eight hours in 80°F weather. Where there was a problem, the stores almost invariably offered credit or redelivered goods, and fast. (Bashas' did offer to redeliver those missing 11 items.) Speedy service, of course, depends in part on your Internet connection. Using a dial-up modem is not ideal. (Five out of six Peapod customers have a broadband connection, compared with one out of every two U.S. home Internet users.) With a cable or DSL broadband connection, the image-intensive sites load quickly and their functions, such as sorting, respond almost immediately.
With all that extra time, you might find yourself thinking about food differently. Assembling shopping lists can become a family affair, as the sites typically allow lists to be e-mailed around so others can add or remove items. Lists can also be assembled bit by bit over the week as cupboards run dry or inspiration strikes. All the services we tested sell prepared foods just like in the regular stores, from ready-to-heat lasagna to rotisserie chicken. They also sell the same premium meats as their brick-and-mortar counterparts. That means busy families can stock their kitchens with a wide variety of meal options and never be stuck making a frantic midweek trip to the supermarket. And whether they grill a filet mignon themselves or heat up a prepared steak from the store, they can always top off the meal with the most delicious, ruby-red strawberries they've ever tasted.
The Check-It-Out Line
DO ONLINE GROCERS REALLY DELIVER? MONEY DOES SOME UNDERCOVER SHOPPING AROUND THE COUNTRY TO FIND OUT.
We dispatched shoppers with identical grocery lists to the virtual aisles of online grocers in eight cities. Our picky testers were all Web-savvy but had never before purchased groceries over the Internet. They evaluated the entire experience, from setting up an account to placing the order to receiving the delivery to, you know, eating the food. They complained when an item was missing or damaged. Then they compared Web prices with those in local stores. They shopped online multiple times to get an accurate picture of how long it takes to click through an order. For the most part, they enjoyed it. Their grades and comments are below.
(Scores are on a scale of 1 to 5, with 5 being the best.)
NOTES:  For two-hour window; extra $5 for half-hour window.  Depending on order size.  $12.95 for same day.  $15.50 for same day.