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The Spoon

Daily news and analysis about the food tech revolution

Grocery

CES 2021: Samsung’s SmartThings App Adding Shoppable Recipe and Guided Cooking

Samsung announced today that it will be adding shoppable recipes, guided cooking and more such functionality to its SmartThings Cooking mobile app.

The added functionality is powered by Whisk’s Food AI (Samsung NEXT acquired Whisk in March of 2019), some of which has been available as part of the Family Hub software found in Samsung appliances.

With today’s news, smartphone users with the SmartThings Cooking app will be able to:

  • Get personalized recipe recommendations based on taste, preferences as well as what is immediately available.
  • Shop for ingredients and other food through the Whisk network of retailers including Walmart, Kroger, Instacart and Amazon Fresh.
  • Guided cooking instructions along with automatic temperature controls sent out to synced Samsung cooking appliances.

This could be the year where shoppable recipes and appliance integration take off. We are coming off a record year of online grocery shopping, thanks to the pandemic, so more people than ever are accustomed to buying groceries, including perishables, online. So the logical next step is tying together all of the threads in the meal journey: discovery, selection, access and instruction.

Samsung’s integrating functionality does all that and extends it now to the mobile phone. Of course, taking advantage of all of these new features means that you have to buy into the Samsung ecosystem and get all your appliances from the same maker.

As CES is kicking off this week, there will be a slew of kitchen appliance related announcements. Given how much online grocery shopping took off last year, and its projected growth over the coming years, I wonder how much more shopping integration we’ll see.

Albertsons Debuts Automated Pickup Kiosk

Grocery retailer Albertsons announced today that it is piloting a new automated kiosk for grocery pickup. The kiosk is located at one of the company’s Jewel-Osco stores in Chicago.

The new kiosk, built by Cleveron, has regular and deep-freeze temperature zones, and gives curbside pickup customers a new contactless option when getting their groceries.

Jewel-Osco customers in the service area interested in using the new kiosk select “Kiosk PickUp” when shopping online, and are then give two-hour time slots to pick up their groceries. When customers arrive, they scan a code on their phone at the kiosk and their order is robotically moved to the front of the unit for pickup.

Last year, Alberstons expanded the use of automated micro-fulfillment centers, which use robotics in the back of house to pick and pack e-commerce orders. With today’s news, Albertsons is extending its automation efforts from the store room to the curb.

Albertsons’ moves, however, are part of a larger wave of automation running through the grocery industry right now. Last year was a record year for online grocery shopping, thanks to the pandemic closing restaurants and keeping people at home. In response, grocery chains have been adding systems to make online grocery shopping and order fulfillment easier. Kroger will open its automated fulfillment centers this year, FreshDirect built out an automated fulfillment facility in D.C. using Fabric’s technology, while Walmart started testing grocery delivery via autonomous vehicles.

Albertsons first automated kiosk in Chicago is already fulfilling orders and the company says it plans to install a second unit at a San Francisco Bay Area Safeway soon.

Ketotarian, Mushrooms and Innovation Among Kroger’s 2021 Food Trend Predictions

Grocery giant, Kroger provided its food trends recap of 2020 and predictions for 2021 over the weekend. And while the list is definitely a PR move, it does provide a little insight into where the retailer thinks food is headed over the coming year.

But before we get into Kroger’s predictions, let’s take a quick look back at what foods trended at the retailer over 2020. Kroger compiled its results from year-over-year sales growth across Kroger’s business including its roughly 2,800 retail stores as well as pickup, delivery and ship. Based on that, these foods were the big winners of 2020:

  • Zero-Calorie Soft Drinks
  • Four-Cheese Mexican Blend Shredded Cheese
  • Flavored Potato Chips (Hot & Spicy, Regional Flavors & Meal-Inspired Varieties)
  • Sauvignon Blanc Wine
  • Heavy Whipping Cream
  • Fresh Burger Patties
  • Artisan Breads & Restaurant-Style Buns
  • Bulk Individual Coffee Pods (96-Count)
  • Party-Size Bags of Variety Chocolate
  • Black Forest Ham

Snacks. Cheese. Wine. Kroger’s list does seem to accurately reflect our collective mood during the pandemic year, when most of us were locking down and not leaving the house. Perhaps what’s more interesting, however, is what’s not on that list: Plant-based foods. Or plants of any kind, really.

This lack of plant-based burgers is in contrast with larger data showing that sales of plant-based meat (Beyond Burgers, Impossible Burgers, etc.) skyrocketed during the pandemic. The animal-based meat supply chain was strained as people panic-shopped, and ethical concerns over meat processing were raised as meat packing facilities became COVID hotspots.

That there were no plant-based foods on Kroger’s list could be a function of the type of shoppers the store gets, or that the growth in plant-based foods wasn’t enough when compared with the other foods. Snack foods, in particular made a comeback during the pandemic as we all tried to find comfort where we could.

Comfort food is actually a trend that Kroger sees continuing into 2021, writing that “Easy-to-prepare comfort foods are on the rise as consumers look to balance convenience and quick preparation times with flavorful meal options.”

While plant-based foods may have been absent from Kroger’s 2020 trends list, the retailer predicts that a “ketotarian” diet will become more popular this year. As Kroger explains, a ketotarian diet is “a plant-based spin on traditional keto guidelines. Consumers can expect to find a growing selection of these plant-based, high-protein foods on grocery shelves in the year ahead.”

While we’re talking about plants, Kroger also predicts that mushrooms will play a bigger role in our diets this year, writing “Consumers should expect to see mushrooms play a starring role in a variety of new products in 2021, including blended plant-based proteins, condiments, spices, seasonings and more.” We’ve actually been watching this mushroom mania play out over the past year here at The Spoon as mushrooms and mycelium kept popping up as the backbone for new types of proteins including cuts of plant-based meat.

One of Kroger’s 2021 predictions is also near and dear to our Spoon hearts: Innovation in the fresh food aisle. Kroger said to look out for in-store hydroponic farms and plant-based coatings like Apeel that extend the shelf-life of produce among the new technologies to look out for.

A trend that Kroger didn’t mention was food-as-medicine, a space which the retailer has been a leader in. We probably shouldn’t tie this list too much into overall business strategy for the company, but it’s noticeable, given everything that is on the list.

Whether or not it’s a PR stunt, Kroger’s predictions actually seem pretty reasonable, though I wish they had predicted a few more robots, especially since they are building out all those automated warehouses.

Data Analysis Shows Strong Foot Traffic Debut (and Dropoff) for Amazon’s Woodland Hills Fresh Store

It was by no means high on the list of disappointments in 2020, but I was still bummed that I couldn’t visit Amazon’s first Fresh grocery store in Woodland Hills, CA when it soft launched in August of this year.

It was Amazon’s first full, physical supermarket (the company had opened smaller scale Go Grocery stores before) and excitement was high. What types of Amazon-type technology would Jeff Bezos bring to the grocery sector?

Evidently a lot of people were keen on checking out Amazon, Fresh, according to data released this week from Placer.ai, a company that uses mobile phone location data to gather and analyze foot traffic to real world retail locations.

According to Placer, Amazon Fresh saw a surge of customers in the first weeks it opened to the public in September. In a blog post this week, outlining its findings, Placer wrote:

The first week saw visits on par with two local players with very strong visits rates, Trader Joe’s and Ralphs. But, Amazon Fresh quickly burst ahead with four of the next five weeks seeing the location drive over 5,000 more visits per week than either of those two competitors.

Amazon Fresh was also getting roughly the same number of visits per visitor as comparable grocers. Ralph’s and Trader Joe’s were seeing 2.4 and 2.2 visits per visitor respectively, while the new Amazon Fresh was already seeing 2 visits per visitor, indicating that people were having a good enough experience at Fresh to come back.

Placer reports that one of the reasons Amazon Fresh enjoyed so much foot traffic is because of the store’s “True Trade Area.” When picking a location for a store, a grocer might consider its main customer base to be within a straight five-mile radius of that store. But Placer’s data gathering shows that this strict geographic limitation isn’t accurate, and that a store’s shopping base can actually come from further out. This expanded reach is what Placer calls the True Trade Area.

As you can see from this map, Amazon Fresh Woodland Hills’ True Trade area actually covers a large swath around Los Angeles, so it was pulling customers from outside of Woodland Hills.

I was curious about some of Placer’s findings, so I spoke with Ethan Chernofsky, Placer.ai’s VP of Marketing (and author of the Amazon blog post), by phone this week. My first question was whether some of Fresh’s sizeable foot traffic could be attributable to curbside pickup. Amazon.com’s customer base it so huge, perhaps people were just ordering groceries online and picking them up at the Fresh store, even if that meant driving to another part of town. But Chernofsky said that was unlikely, given the length of time people were staying at the Fresh location.

But while Amazon Fresh enjoyed an early boom in foot traffic, starting in October, Amazon Fresh saw its numbers fall. As the Chernofsky detailed his analysis “Between October and November, the Amazon Fresh True Trade Area decreased by 27.1%, just as monthly visits declined 27.6%. On the other hand, Ralphs saw visits rise 13.7% as its own True Trade Area declined by 7.1%.”

One explanation for the drop could be that the excitement wore off, and what was once shiny and new was no longer shiny and new. Chernofsky doesn’t think that’s it though. As he wrote in a corporate blog post “the close relationship between visits per visitor metrics between the top local grocers indicates that this location was actually succeeding in driving repeat visits even among the launch buzz.”

Instead, Chernofsky attributed the drop to the COVID resurgence in Los Angeles this fall. As the virus reemerged, travel and work was limited, so there was less cross shopping, or tacking on a visit to the grocery store during an errand.

Amazon Locations Around Los Angeles

Another factor could be the fact that Amazon added three additional Fresh locations in Los Angeles since the opening of the first Woodland Hills location. The Northridge and North Hollywood locations both opened in mid-November and seem like they would draw from the same pool of customers as the Woodland Hills location’s True Trade Area.

Regardless, data like that from Placer is worth looking at to see how well Amazon is doing as it starts its forays into real world grocery. I’m still looking forward to a time when I can see the Amazon Fresh stores in person.

Cashierless Checkout Startup Trigo Raises $60M

Trigo announced today it has raised a $60 million Series B round to scale its cashierless checkout for the grocery store. The round was led by 83North with participation from existing investors Vertex Ventures Israel, Hetz Ventures, Red Dot Capital Partners, Tesco, and Morrag Investments. It brings Trigo’s total funding raised to date to $94 million, according to a press release sent to The Spoon.

Headquartered in Tel Aviv, Israel, Trigo retrofits grocery stores with a combination of AI-powered computer vision tech and ceiling-mounted cameras to enable cashierless checkout for retailers and customers. The end result is that customers can enter a supermarket, grab the items they need, and walk out without stopping at a traditional checkout station. Digital payment and receipts are automatic.

Last year, the company raised a $22 million Series A round and struck a partnership with U.K.-based grocery retailer Tesco. Trigo also has a partnership with Israel’s largest grocer, Shufersal.

Once the sole domain of Amazon and its Go stores, cashierless checkout has evolved over the last year to include many different companies, including Grabango, Zippin, and AiFi. Cashierless tech also has multiple use cases at this point. While the majority of its implementations are still in grocery stores, the tech is currently at stadiums, restaurants, and in apartment complexes, too.

The uptick in activity for this space makes sense given the global pandemic and an increased desire on the part of both retailers and customers to make the grocery store shopping experience more hands free.

For its part, Trigo says it will use its Series B funding to scale up, boost R&D, and expand its global presence.

Germany-Based Gorillas Raises $44M for Speedy Grocery Delivery

German grocery delivery startup Gorillas has raised a $44 million Series A round of funding led by hedge fund Coatue, TechCrunch reports.

Gorillas promises super-speedy grocery delivery, with the company saying it averages a delivery time of 10 minutes. It does this by creating smaller, delivery only (or “dark”) grocery stores. These dark stores can be placed in neighborhoods closer to where customers live, and can be engineered to enable faster pick-and-pack orders only, instead of being set up to serve in-store shoppers as well.

The dark store concept is catching on with a lot of startups. Over in the U.K., Weezy promises fast grocery delivery thanks in part to its smaller neighborhood fulfillment centers. Here in the U.S., DoorDash created its own branded dark convenience store, and Fabric‘s automated fulfillment centers are meant to be built into smaller locations.

The global pandemic pushed people into grocery delivery earlier this year. And though sales have dipped from record highs earlier this year, e-grocery continues to be sticky with customers who are ordering more and more often online. Perhaps more importantly, online grocery sales are projected to keep growing and take up 21.5 percent of total grocery sales by 2025, reaching 250 billion dollars.

So it makes sense that we’re seeing a number of companies angling now to get your e-grocery business and hopefully your loyalty as the entire sector grows. And it’s not just startups either. Amazon and Walmart are aggressively touting speedy delivery and offering free grocery delivery as a perk for joining their respective membership services.

For it’s part, Gorillas told TechCrunch that it plans to use its new funding to roll out its service across more cities in Germany and throughout Europe, starting with Amsterdam in the Netherlands.

AiFi’s Cashierless Checkout Powers New 4,000 Sq. Ft. Store in Shanghai

AiFi announced today that its technology is powering a new cashierless checkout store in Shanghai. According to an email sent to The Spoon, the 4,000 sq. ft. store carries 2,000 SKUs including fresh meat and snacks, and is the largest such store powered by AiFi’s technology.

AiFi is perhaps best known for its standalone, shipping container-sized NanoStores, which offer pop-up cashierless retail experiences. With today’s launch, the company is showing that its technology can scale up (at least a bit) and be used for larger-format stores. The new AiFi-powered store in Shanghai is a “hybrid” store that also features a human cashier should shoppers prefer that option.

Casherless checkout allows shoppers to walk into a store, grab what they want and leave, getting charged automatically upon exit. The global pandemic has accelerated interest in cashierless checkout retail experiences because they help reduce human-to-human interaction, and can also cut down on the amount of time shoppers spend inside a store. Fellow cashierless startup Zippin announced yesterday that it has partnered with Fujitsu to bring its technology to market in Japan.

Unlike Zippin, which uses a combination of shelf sensors and computer vision for its cashierless checkout solution, AiFi relies solely on computer vision to track shoppers as they move through a store. Those computer vision capabilities could soon get a boost, thanks to a recent investment in the company from Qualcomm Ventures, the venture arm of the chip giant. As we wrote at the time of the fundraise:

That a Qualcomm entity would invest in AiFi isn’t too surprising. AiFi’s stores rely on a lot of wireless technology, and the startup’s pitch is that it creates a faster retail experience by producing shopping receipts in real time. But Qualcomm is also moving more into computer vision, which is a cornerstone of cashierless checkout. In July, Qualcomm announced a chip cluster that adds machine learning and AI to mid-tier cameras. So investing in a company that gets that tech into more locations makes sense.

And AiFi is certainly looking to get into more locations. AiFi says it has partnerships with top grocery chains in the U.S., Europe and Australia. Earlier this year, AiFi announced that it was going to deploy 330 new and retrofitted stores around the world by the end of 2021.

Will Removing the Minimum Order Give Walmart+ a Boost with Grocery?

Walmart announced today that starting Dec. 4, it will remove the $35 shipping minimum on Walmart.com orders for its Walmart+ members.

An answer to Amazon’s Prime Membership, Walmart+ launched in September of this year. With today’s announcement, Walmart+ members will get free next-day and two-day shipping on items from Walmart.com no matter the size of their shopping basket.

Normally, we wouldn’t cover this type of announcement because it has to do more with the shipping of non-grocery goods ordered through Walmart’s website. In its press announcement, Walmart even specifically said that grocery deliveries will still carry a $35 minimum.

But we are covering it because Walmart and Amazon are currently duking it to grab your grocery dollars. Both Walmart+ and Amazon Prime offer free grocery delivery as part of their member perks, but the war between the two companies has steadily escalated.

By some accounts, Amazon has more than 120 million Prime members in the U.S. This is a massive base to which it can upsell its grocery services. Of course, Amazon has been building that user base for years, but over the past year, the company has also been building out its grocery infrastructure. In addition to owning Whole Foods, Amazon has launched its real-world Go Grocery stores and Fresh supermarkets, as well as expanded its free grocery delivery for members to provide services like in-garage delivery.

But it’s in that real world where Walmart has its biggest advantage over Amazon. Walmart already has a gigantic, nationwide footprint of more than 4,700 stores in the U.S. Walmart+ members already get free unlimited grocery (though, as noted, there is an order minimum), but Walmart can tie in other real world services like curbside pickup, discounts on gas and mobile scan-and-go cashierless shopping.

In short, if Walmart can attract more people to its Walmart+ offering, that will help it stave off Amazon from gobbling up more of the grocery biz. It’s still a big if, but removing the minimum order amount as Walmart did today could help it sway more users to join Walmart+ and use the service for more grocery delivery.

DoorDash Launches Initial Public Offering

DoorDash announced today it has launched the roadshow for its initial public offering (IPO). The company is offering 33,000,000 shares of its Class A common stock, with the initial public offering price expected to be between $75 and $85 per share, according to a company press release.

The San Francisco-based food delivery service confidentially filed for an IPO in February of this year and unveiled the public S-1 filing in November. The S-1 filing revealed that the company reported a profit for the first time in its history during the second quarter of 2020 — which coincided with the rise of the COVID-19 pandemic. It’s a noteworthy milestone in an industry that thrives on promising a profitability it hasn’t, for the most part, achieved yet.

For DoorDash, part of that trek towards profitability appears to be expanding its service to other areas of food delivery besides restaurants. In April, the company announced partnerships with major convenience stores, including Wawa and 7-Eleven, and in August, it launched a grocery delivery service. It even went as far as to open its own “ghost convenience store,” called DashMart, which is basically a virtual convenience store owned and operated by DoorDash.  

Those new sales channels may be necessary at a time when the restaurant industry faces new restrictions to help curb the spread of the pandemic. It is difficult to say at this point how many restaurants will shutter permanently when all is said and done, and delivery services may need to branch out further to keep on the road to profitability. 

According to the Wall Street Journal, DoorDash is aiming for a valuation of $25 billion to $38 billion. The company garnered $675 million in revenue and a profit of $23 million for Q2 2020. For Q3, it posted a net loss of $43 million for Q3, but still reported revenue growth of $879 million. The company has said in the past that COVID-19-related lockdowns have played a significant role in its growth. That could be the case for a long time yet.

Swedish Grocery Delivery Service Vembla Raises 6M SEK

Vembla, a Swedish delivery service for groceries and other goods, told The Spoon via email today that it has raised 6 million Swedish Krona (~$704,000 USD) from angel investors including Tuomas Kukkonen (FMCG entrepreneur in Finland), Michael Wolf (ex CEO of Swedbank), Manfred Aronsson (ex. CEO Discovery Networks).

Similar to Instacart here in the U.S., Vembla is an app that partners with local grocery stores in Sweden. Customers shop at stores on the Vembla app, while Vembla “shoppers” go in and pick up the order and deliver it. The startup promises to deliver orders in an hour.

According to the press announcement that Vembla sent, online grocery shopping in Sweden hit 5 percent of total sales in 2020, up from 2 percent in 2019. That growth is projected to continue to hit nearly 7 percent of total sales in 2022 (Source: Industry reports, DI, Nordea).

We aren’t that well versed in the Scandinavian grocery market, but it stands to reason that the COVID-19 pandemic would have a similar effect in Sweden as it has here in the U.S. Even though Sweden has been more lax in its approach to tackling the virus.

Domestically, the pandemic pushed online grocery shopping to record heights this year. Over the next five years, online grocery shopping is projected to take up 21.5 percent of all grocery sales in the U.S.

The bigger question for pure delivery plays like Vembla and Instacart is how long retailers will rely on them. Right now, third-party delivery services can help with the crush of new customers. But over the long haul, will retailers want to keep handing over the customer relationship to an outside delivery service, or do more investment to bring delivery in-house?

Autonomous Middle-Mile Company Gatik Raises $25M

Autonomous vehicle startup Gatik announced today that it has raised a $25 million Series A round of funding. The round was co-led by Wittington Ventures and Innovation Endeavors with participation from FM Capital and Intact Ventures, as well as existing investors Dynamo Ventures, Fontinalis Partners, AngelPad and others. This brings the total amount raised by Gatik to $29.5 million.

Unlike other players in the self-driving delivery space, the Palo Alto, California-based Gatik is focused on the middle-mile — that is, the intra-location routes for a business, for example warehouse to store, store to store, etc.

The advantage of this, from a self-driving vehicle perspective, is that these middle-mile routes are fixed and repeated. This reduces the amount of “thinking” that a self-driving vehicle has to do as it carries goods around because it’s not encountering as many new scenarios. These fixed routes can also help put regulators creating laws around self-driving vehicles more at ease because of their limited scope and reach.

From a business’ perspective, like a grocer, a fleet of autonomous middle-mile vehicles could run all day, every day, ensuring that locations are always fully stocked. In its press announcement, Gatik said that its autonomous vehicles are operating up to seven days a week, 12 hours a day, on single routes up to 300 miles.

Along with its funding announcement, Gatik today also announced that Canada’s Loblaw grocery chain will deploy a fleet of five Gatik vehicles for middle mile delivery in Toronto starting in January 2021. Gatik’s cargo trucks feature temperature control, so they can be used for the transport of cold and frozen foods as well.

In the Loblaw press announcement, Gatik said that its autonomous vehicles will run between automated picking facilities and retail stores, and allows for inventory pooling across multiple location, as well as contactless delivery.

November has been a busy month for autonomous delivery. Last week Walmart announced a partnership with Cruise for self-driving grocery delivery. Nuro announced it had raised another $500 million for its self-driving pod vehicle solution. Part of the reason for all of this is the COVID-19 pandemic, which has accelerated interest in contactless delivery options to reduce human-to-human interaction.

Gatik has previously worked with Walmart, and says it has conducted 30,000 autonomous orders for multiple Fortune 500 customers across North America.  

CORRECTION: An earlier version of this post said Gatik raised $22.5 million. We regret the error.

Ahold Delhaize Buys Majority Stake in FreshDirect

Dutch grocer Ahold Delhaize announced yesterday that it has bought an 80 percent stake in New York-based online grocer FreshDirect. Private equity firm Centerbridge Partners bought the remaining 20 percent. Terms of the deal were not disclosed.

FreshDirect will continue to operate as an independent unit and under its own brand name. The company will join other Ahold Delhaize brands that include Stop & Shop and Giant Foods.

The purchase of FreshDirect comes on the heels of what has been a pandemic-induced record year for online grocery sales. New York City, one of FreshDirect’s main service areas, was hit particularly hard in the early stages of the pandemic, pushing the company’s delivery capacity to the brink. With the U.S. entering its third wave with the virus, having the massive infrastructure and resources of Ahold Delhaize could help FreshDirect weather any coming storm.

The combination of Fresh Direct and Ahold Delhaize also has a tech-forward angle. In addition to being an online-only grocer, FreshDirect also recently opened up a robot-powered fulfillment center in the Washington, D.C. area. For it’s part, Ahold Delhaize has experimented with automated micro-fulfillment centers, in-store robots, and small, cashierless nano-retail environments.

With the FreshDirect acquisition, Ahold Delhaize is also bolstering its capabilities to better fend off competition from the giant players in the grocery space. Walmart has made aggressive grocery delivery moves through its Walmart+ subscription service as well as a partnership with Instacart (and experimenting with self-driving delivery cars). And Amazon, which was once online only, has made moves into the physical space with its Go Grocery and Fresh stores.

With online grocery projected to become 21.5 percent of total grocery sales by 2025, expect these types of salvos between supermarkets to continue into the next year.