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The Spoon

Daily news and analysis about the food tech revolution

Amazon

Amazon to Make Food Network Kitchen’s Video Cooking Classes Free on Fire Devices

If you’ve been stuck in a quarantine meal rut and want to learn how to cook something fresh and exciting, Amazon has some good news for you. Variety reports Amazon announced today that it is giving Food Network Kitchen to all Fire TV and Fire Tablet users in the U.S..

Launched last fall, Food Network Kitchen features live and on-demand cooking classes from its roster of celebrity chefs including Bobby Flay, Rachel Ray and Guy Fieri. A subscription to the service normally runs $4.99 a month or $39.99 a year.

If you’re among the more than 40 million active Fire TV or Tablet users however, Amazon is footing that bill — for a year, anyway. The e-commerce behemoth is paying Discovery, which owns Food Network, for all the subscriptions.

Food Network Kitchen has more than 2,300 on-demand cooking classes, but had to halt production of its live offerings because of the COVID-19 outbreak. Variety writes that the live shows will return at the beginning of May, though they will be shot in the home kitchens of its celebrity chefs, rather than in a studio.

In addition to cooking content, Food Network Kitchen also has shoppable recipes for an e-commerce component and will be launching a meal planning feature soon. Ingredients for meals can be purchased directly through the app via Amazon Fresh, Peapod or Instacart. Though given how sheltering in place has caused a national surge in grocery e-commerce (Amazon now waitlists new Fresh customers and Instacart is adding another 250,000 of its shoppers to keep up with demand), this feature may not be useful to consumers until things settle out.

One curious bit about today’s news is that reports only mention that the deal covers Fire TV and Fire Tablet users. Food Network Kitchen is also available on Amazon’s Alexa devices that feature a screen, like the Echo Show. Are those devices not included? We reached out to Discover to find out more. UPDATE: A Discovery rep told us that the offer will be extended to Echo Show customers later this year.

A Food Network exec told Variety that its app has been downloaded more than 5 million times since launch, and that both viewtime and subscriptions are up 50 percent each during this coronavirus lockdown. Free access to Food Network’s celebrity chefs combined with Amazon’s massive promotional capabilities should be a huge shot in the arm for the service.

If Discovery wanted to make even more of an impact, it would fast track a show about making bread.

Takeaway.com and Just Eat’s $7.6B Merger Approved

The U.K,’s Competition Markets and Authority (CMA) has approved Takeaway.com’s £6.2 billion ($7.6 billion USD) takeover of British food delivery service Just Eat. The merged company also announced it had raised €700 million ($756 million) in new outside funding in the form of new shares and convertible bonds.

The deal was originally announced in July of 2019. A bidding war with tech investment firm Prosus followed shortly thereafter, which Takeaway.com won — only to have the CMA open an investigation into the deal to see if it would “result in a substantial lessening of competition” in the U.K. food delivery market. 

Takeaway.com previously operated in the U.K., but exited that market in 2016. The CMA’s investigation concerned whether the Dutch company would have re-entered the U.K. market of its own accord without the Just Eat deal. 

“In this case, we carefully considered whether Takeaway.com could have re-entered the U.K. market in future, giving people more choice,” the CMA’s mergers director Colin Raftery said in a statement. “It was important we investigated this properly, but after gathering additional evidence which indicates this deal will not reduce competition, it is also the right decision to now clear the merger.”

The approval comes just days after the CMA provisionally approved Amazon’s investment in delivery service Deliveroo, which has been under investigation for similar reasons. In the case of this deal, the approval seems more tied to the COVID-19 pandemic than anything else, with the CMA concluding that the virus is having significant enough impact on Deliveroo’s business to endanger the third-party delivery company. 

Coronavirus doesn’t appear to be the driving force behind the Just Eat-Takeaway.com deal, which was never as dangerously on the rocks as Amazon’s anyway. According to CNBC, the new funding will be used to in part pay down debts as well as pursue “strategic opportunities.”

Amazon Gets Approval for Its Deliveroo Investment Thanks to the Pandemic

The UK’s Competition and Markets Authority (CMA) provisionally approved Amazon’s investment in Deliveroo over the weekend after Deliveroo warned its business could collapse without the funds. The third-party delivery service cited the COVID-19 pandemic, which has forced many restaurants worldwide to close, as the reason for “significant decline in revenues,” according to a statement from the CMA.

Deliveroo announced a $575 million Series G funding round in May of 2019 — of which Amazon was set to be the largest investor. In July of that year, the CMA put Amazon’s involvement under scrutiny, saying there were “reasonable grounds” the two companies would “cease to be distinct” with the investment.

As I wrote in December, when the investigation entered Phase 2:

As regulators have stressed, the Deliveroo investment would give Amazon a path back into the market and immediate access to Deliveroo’s existing customer base. That in turn would undercut competition from other food delivery services in the UK such as Uber Eats and Just Eat. 

The ongoing pandemic coupled with the restaurant industry fallout has changed that. Many of the restaurants Deliveroo previously worked with have closed. That includes major QSR chains like McDonald’s and Burger King, have stopped all operations including delivery and takeout, in the UK.

In its announcement, the CMA said “it has become clear that the coronavirus pandemic is having a significant negative impact on Deliveroo’s business” and has “provisionally concluded that Deliveroo’s exit from the market would be inevitable without access to significant additional funding, which the CMA considers that only Amazon would be willing and able to provide at this time.”

The CMA is currently taking views on its findings until May 11 2020, and has until June 11 2020 to make a final decision. 

Want to Sign Up for Amazon or Whole Foods Grocery Delivery or Pickup? You’ll Have to Wait(list)

Grocery delivery has been a lifeline for those unable to visit supermarkets in person and those just trying to flatten the viral curve. But there’s been a rush to grocery e-commerce, and if you’re just now trying it out, there’s a good chance that you’re gonna have to get in a virtual line.

Amazon announced today that it is instituting a waitlist for new online Amazon Fresh and Whole Foods customers. From a blog post outlining a number of changes the company was making in the wake of the COVID-19 pandemic:

We are temporarily asking new Amazon Fresh and Whole Foods Market delivery and pickup customers to sign up for an invitation to use online grocery delivery and pickup. We’re increasing capacity each week and will invite new customers to shop every week.

Also in that announcement was the news that Amazon’s Woodland Hills, CA location, which was to be the first of its full-on supermarket locations, was opening as an online only order fulfillment center. Thankfully, that location appears to have robots to help with order processing.

Amazon isn’t the only company struggling to meet the crush of new demand in online grocery. Eater reported last week that FreshDirect and Instacart customers in NYC were staying up all night to try and get delivery slots. Grocery Dive wrote today that some ShopRite customers are being placed in virtual waiting rooms before they can shop (Ocado and Morrison’s shoppers in the UK face similar situations). And anecdotally speaking, my local Safeway’s delivery is full through the rest of this week, with no option to schedule beyond that.

All this is to say that grocery retailers, even the big ones, are having a hard time with all this craziness. Though they are all hiring like crazy, the infrastructure just wasn’t in place to handle years’ worth of growth in a matter of weeks. Hopefully, grocery retailers will be able to get their processes all ironed out so people will be able to get their food, while keeping all those store and delivery workers safe.

In the meantime, if you’re an existing Amazon/Whole Foods online customer, you can try this free downloadable tool that alerts you when delivery slots from the company opens up.

Amazon’s Grocery Stores Are Headed for NYC, Will the Pandemic Change Any Building Plans?

If there’s any hope to be found nowadays, it could be that at least Amazon is carrying on like business will get back to normal at some point. Grocery Dive reports that Amazon is taking over the leases of two New York City stores that belonged to the now bankrupt Fairway Market chain.

Amazon paid a reported $1.5 million at auction for the stores, which are located in Paramus and Woodland Park. Amazon recently opened up a cashierless Go Grocery store in its hometown of Seattle, and was supposed to open up the first of its full-on supermarkets in Woodland Hills, CA this month but, you know, that probably getting pushed out, given the state of the world. Grocery Dive says Amazon is also interested in opening up grocery stores in Chicago, San Francisco and Philadelphia.

While there is some comfort in the fact that Amazon is forging ahead, one has to wonder if Amazon is altering any of its building plans because of the COVID-19 outbreak. Amazon has said its Woodland Hills location won’t have cashierless checkout, but as grocery retailers limit hours, put cashiers behind plexiglass shields and take other measures to reduce human contact, will Amazon reconsider? No cashiers is one less person on the frontlines of any future outbreak.

Additionally, we also know that the Woodside location will have some form of automated robot fulfillment. The question now is whether the surge in online grocery shopping occuring now, as people shelter in place, will continue after the outbreak recedes. Will Amazon, which already loves robots, build more of its future stores around e-commerce fulfillment automation into its future locations?

The question of how things will change for good once life gets back to normal is one we’re asking about a lot of our previous behaviors. But with Amazon just now building out grocery market locations from the ground up, it has the opportunity to capitalize on any new norms.

As Online Grocery Shopping Surges, Walmart Leads the Retail Pack (and Could Stay There)

With COVID-19 limiting movement in some cities and raising new concerns about being out in public among groups of people, there’s been a surge in online grocery shopping. And according to a piece in Bloomberg yesterday, Walmart was the top destination for online grocery shopping, which could translate into being the long-term leader in the space.

Bloomberg writes:

As online grocery shopping goes mainstream, Walmart will be the main beneficiary. One-third of shoppers surveyed by Gordon Haskett Research Advisors on March 13 said they bought food online over the past week, and of those, 41% were doing so for the first time. For those newbies, Walmart was by far the most popular option, capturing more than half of orders. Amazon and its Whole Foods chain garnered only 14%.

Now we don’t know how big the sample size of this survey was, but the results seem in-line with what we would expect. Walmart is a massive retail operation with a broad distribution of physical stores, so it makes sense it would be a big beneficiary of our current situation.

Prior to the global pandemic, Walmart and Amazon had been locked in a heated battle for supremacy in the online grocery space. The two retail giants exchanged tit-for-tat moves over the past year: Walmart launched and rolled out Delivery Unlimited for groceries nationwide, Amazon waived delivery fees for its Prime members, Walmart started testing its own Amazon Prime-like membership service, and Amazon started building its own physical grocery store locations.

Walmart already having physical locations definitely gives it an advantage in this time of social distancing. Walmart stores are there for people brave enough to actually go out and shop in person. The stores also act as a distributed network for home deliveries, or can provide pickup locations for online orders.

I myself am putting this last scenario to the test. I live in a more rural area and while delivery from my local Safeway couldn’t be fulfilled for more than a week and a half at the time of ordering, I can do an at-store pickup from Walmart tomorrow. Aside from a couple of minor hiccups, the Walmart app and online experience was pretty easy. Most everything I wanted was in stock, and if it wasn’t, they made it easy to swap.

As more people are forced into online grocery shopping for the first time they will go to where they can get the food and supplies they need in a timely manner. With Amazon struggling to keep up with delivery demand, Walmart, with its network of stores could become people’s de facto preference. And once they have an account set up with Walmart, re-stocking pantries will be that much easier as this lockdown continues and into a time in the hopefully not too distant future when we can emerge from our homes.

Online Grocery Shopping Surges Amidst Coronavirus (So Tip Your Delivery Drivers!)

The Spoon is headquartered just outside of Seattle, and with a rise in coronavirus cases here over the weekend, things are understandably a little… tense. This tension was on full display at my local Safeway last night, where the cleaning supply and dry goods sections of the store were picked over and barren.

The rapidly spreading virus has sparked a rash of panic buying here and across the U.S. as concerned citizens stock up in the event of a societal collapse. The Washington Post writes:

Shelf-stable and frozen foods were in high demand. At a Trader Joe’s market in Mountain View, Calif., the freezer section was cleared out of pizza and most ready-made meals by Sunday evening. There was no pasta or rice left. One woman’s cart was piled to the brim with frozen mushroom ravioli. Another cart was filled with six gallons of milk.

Facing empty real world stores and an increasing fear of being in public places, there’s a surge in online shopping. According to MarketWatch:

In the past 30 days, 21% of U.S. consumers ordered perishable, edible groceries online, [NPD Groupd analyst David] Portalatin said. That’s up from 18% at the same point last year.

All this online shopping has taxed even the biggest of delivery players. Bloomberg reports that Amazon’s Fresh and Prime Now delivery services have been overwhelmed, and yesterday Amazon said delivery from both of those services would be impacted as it strains to meet up with demand.

As people find comfort in shopping from home, however, it’s important to remember that human beings are still making those deliveries. The Seattle Times notes that the boon in shopping means drivers can make more money, but they are definitely putting themselves at risk:

Some drivers have begun using hand sanitizer before and after ID checks, while some customers are applying disinfectant to grocery bags, said the gig-economy driver, who asked not to be identified for fear of reprisals from the companies.

Faced with an amorphous, invisible threat that does not discriminate, could literally be anywhere, and will only get worse, our current delivery and logistical systems are going to be pushed to their limits. But as we’ve noted before, this outbreak could also help push forward technological solutions that require less human-to-human contact.

Robots like those from Starship could be an easy humanless way to deliver meals and medicines around the clock in densely populated areas (they’d still need to be sterilized). And self-driving delivery vans like those from Udelv could bring people bulkier items like groceries.

That’s still a ways off, especially since we haven’t had to lockdown any U.S. metropolitan areas (thankfully) yet, and the safety tradeoffs of autonomous vehicles must still be considered. So for now we’re still reliant on humans to make our deliveries. Those delivery drivers aren’t just bringing packages, they are serving as a lifeline to the food we need to eat. If you need to panic grocery shop to feel better, we can’t stop you. Just be sure you tip your delivery driver generously.

Report: Walmart+ to Take on Amazon Prime

Walmart is working on a new membership offering to take on Amazon Prime. Recode was first to report on the forthcoming Walmart+, which will broaden Walmart’s grocery Delivery Unlimited service and include perks like discounts on gas and prescription medication, as well as a Scan & Go service so members wouldn’t have to wait in line.

Recode writes that Walmart has been looking at this for the past 18 months, and the first public tests of Walmart+ could happen as soon as next month. It’s easy to see why Walmart is looking to launch this type of program soon, especially in light its fierce ongoing grocery battle with Amazon.

For its part, Amazon has been making very aggressive moves recently to expand its shopping dominance into the grocery aisle, including:

As you, and Walmart, can see, Amazon has an army of Prime members, and is quickly putting in place the real world means to grab more of their grocery dollars.

I mean, Walmart hasn’t exactly been slacking in the innovation department. It’s experimenting with self-driving delivery vehicles, robot-powered micro-fulfillment, has built out the AI-powered IRL store which uses cameras for real time inventory, and is making a big marketing push for its in-store pickup service.

But Walmart’s Delivery Unlimited, which the company started rolling out in earnest across the US last year, costs $98 for a year. But that’ll only get you free delivery of your groceries. At $119, Amazon Prime is pricier, but you also get music streaming, Prime video, two-day shipping from Amazon and a bunch of other stuff.

So it’s smart for Walmart+ to leveraging what infrastructural advantages it has, pharmacies, gas stations, etc., to fight off Amazon.

One thing is for sure. Walmart+ is just going to be one salvo in a big battle between the grocery retail giants this year.

Report: Amazon’s Grocery Store Will Have Robotic Fulfillment

When Bloomberg surfaced a report last week giving us a first-look inside Amazon’s new grocery store, we were struck by how conventional it was, especially when it came to automation and robotics. But a report from the HNGRY blog this week says that actually, the Amazon grocery store will have robot-powered micro-fulfillment.

From HNGRY’s story:

HNGRY has now confirmed that Amazon is working with Dematic to provide this very technology inside of its new stores, which will ultimately enable faster than average last-mile delivery and in-store pickup. The company has carefully designed this 7,200 sqft area to house room-temperature robotic-picked storage aisles that will house everything from alcohol to packaged food, occupying about 21% of its 33,574 sqft total footprint.

If HNGRY’s reporting is accurate, this actually makes more sense than Bloomberg’s report in a lot of ways. First, Amazon loves robots. It bought robotics company Kiva Systems a long time ago for automating Amazon warehouses. And Amazon is building a big new, dedicated robotics center near Boston.

But it also makes sense from a competitive standpoint. Automated order fulfillment can translate into faster turnaround for grocery pickup or delivery. Already, Walmart is working with Alert Innovation on robot micro-fulfillment, and Albertsons has partnered with Takeoff Technologies.

It would be highly unlikely that Amazon, which prizes speed and efficiency above all else, would cede this type of advantage to its competitors. Amazon offers two-hour delivery for Prime members and waived the delivery fee for Prime members towards the end of last year.

Amazon is also seeing growth in its grocery delivery business. In its most recent earnings report, Amazon said that delivery orders from Amazon Fresh and Whole Foods doubled year-over-year in Q4 of 2019.

HNGRY’s report is reassuring, in a way. I was worried Amazon’s supermarket was shaping up to be a bit of a bore. But it’s likely the company still has a few more technological surprises in store.

Report: Amazon’s New Supermarket Looks Super Conventional, So Far

You might think a grocery store built by Amazon, which has a history of radically re-thinking existing business processes, would be radically different (instead of shelves, just rows of Star Trek-like replicators, perhaps). But Bloomberg got their hands on some plans and photos from inside the yet-to-open Amazon supermarket, and it looks… like pretty much like a regular ‘ole grocery store.

The first of three LA-area Amazon grocery stores is supposed to open next month in Woodland Hills, CA. Bloomberg writes that the 33,000 sq. ft. facility features a meat and seafood section as well as a “Fresh Kitchen” for making prepared foods. But in addition to these regular features, there are a couple of bits of Amazon flair.

First, the store will be equipped with digital tags, similar to the ones used in Amazon’s 4 Star stores, which can change prices and indicated different inventory on a shelf.

There is also a window dedicated to grocery pick up orders and returns. As Bloomberg writes:

Plans show a staging area behind the window with what appears to be shelving, potentially for order pickups from both customers and delivery service providers, who will shuttle orders to people’s homes. A television display and whiteboard sit alongside the return counter, likely to help orchestrate the chaos of deliveries into and out of the store.

Last fall, Amazon waived the fee for one- and two-hour grocery delivery for its Prime members (of which there are 150 million globally). That move seems to have helped spark a surge in deliveries as Amazon reported in its most recent earnings that grocery delivery orders from Whole Foods and Amazon Fresh doubled in its fourth quarter year-over-year.

Equally interesting in Bloomberg’s report is what appears to be missing from Amazon’s grocery store. Amazon has said before that the store won’t feature cashierless checkout a la Amazon Go. But from what Bloomberg describes, the store also won’t feature a back-of-house, robot-powered micro-fulfillment center to speed up online grocery orders either.

One big grain of salt with all this is that Bloomberg is only reporting on the plans and photos it’s seen. There could be a lot more to come that Amazon is being tight-lipped about. Additionally, this is just the first store for Amazon. Perhaps it didn’t want to frighten away potential shoppers with too much tech. With omnichannel grocery shopping valued at more than $1 trillion in the US, it’s safe to assume Amazon is playing the long game and has plenty of time to make buying food radically different.

How will Amazon’s 150M Prime Members Tip the Grocery Scales?

Amazon announced its fourth quarter earnings yesterday, and among the big numbers the company released was the news that it now has 150 million Prime members worldwide. That’s a lot of people with access to Fleabag. Well, more germane to our purposes here at The Spoon, that’s a lot of people who can get free grocery delivery courtesy of Amazon.

We should caveat that the 150 million number is global, and Amazon didn’t break out how many of those members are in the U.S. What we do know is that number is a 50 percent increase in the number of memberships from April 2018, when the company said it had 100 million Prime members worldwide. And while this isn’t a first-hand source, in January of last year, Consumer Intelligence Research Partners estimated that Amazon had 101 million Prime members in the U.S.

Prime members in more than 2,000 U.S. cities get free one- and two-hour grocery delivery from Whole Foods and Amazon Fresh, a perk Amazon added in October of last year (we explained why Amazon did this). In yesterday’s earnings, Amazon said that delivery orders from Whole Foods and Amazon Fresh more than doubled in the fourth quarter year-over-year.

To be fair, “doubling” is a vague and almost useless stat since we don’t know what the previous number was. But flipping that one lever had an immediate impact. What happens as Amazon starts ramping up its grocery efforts?

While Amazon owns all of the Whole Foods locations, the company is building out its own grocery stores, the first of which is slated to open next month in Woodland Hills, CA. Having its own grocery chain is important for a number of reasons.

First, Amazon stores won’t be bound by the same food restrictions as Whole Foods, which doesn’t stock items that contain things like artificial sweeteners or colors. So Amazon will be able to carry more of the products people want.

Second, Amazon is building its own grocery supply chain and logistics from the ground up, so speed and order fulfillment are bound to be innovative and fast. Additionally, as it builds out more physical locations, Amazon will be able to offer more grocery pickup options instead of just delivery.

Finally, the company has tons of data on its Prime members. It knows what they buy, how often, etc.. It will be able to leverage this to make recommendations (perhaps a nudge from Alexa), create promotional offers or bundle in other services (package pickup or return).

All of this comes amidst a fierce battle for grocery supremacy in the U.S. Walmart is rolling out its Delivery Unlimited service nationally, and Kroger is building out robot-powered smart warehouses across the country to speed up online grocery order fulfillment. And both of those retailers are experimenting with grocery delivery via self-driving vehicles.

But Amazon’s Prime Membership gives it a unique weapon in grocery wars — an army of people paying for a closer relationship with Amazon. For better or worse, Amazon is a deeply embedded part of many people’s lives here in the U.S., which means Amazon will be able to tie together technology and data and convenience together in a package in a way its rivals will be hard pressed to match.

British Authorities Open Investigation Into Just Eat-Takeaway.com Merger

Fresh off the heels of a bidding war for the acquisition of UK-based delivery service Just Eat, Takeaway.com, who also offers on-demand restaurant food delivery, faces a new opponent: British regulators.

The Competition and Markets Authority (CMA) said late last week that it is investigating the proposed Takeaway.com-Just Eat Merger to see whether the deal, worth £6 billion (~$8 million USD), would “result in a substantial lessening of competition” in the UK food delivery market, according to The Associated Press.

Specifically, the CMA is looking into whether Takeaway.com would have re-entered the UK market, which the service left in 2016, without the Just Eat deal.

This isn’t the first time the CMA has brought the hammer down on a major deal between two food delivery companies. In May of 2019, Amazon announced a major investment in Deliveroo, only to have it flagged by the Authority, who said it “presented reasonable grounds” that such a deal would make the two companies “cease to be distinct” from one another. In other words, the deal would undercut competition from other food delivery services in the UK, including Just Eat.

The Amazon-Deliveroo investigation is still ongoing, and at last check the deal was said to be in serious jeopardy.

For Takeaway.com and Just Eat, the situation seems a little less dire, at least for now. Takeaway.com said the deal would still go through but be delayed by one week. Takeaway.com said it was confident that clearance on the merger “will be obtained.”

Takeaway.com first announced its intentions to acquire Just Eat in July 2019 in an all-share deal that would create a new company, Just Eat-Takeaway.com. The company then found itself in the middle of a bidding war with Naspers-backed tech investment firm Prosus, who over the last several months has offered multiple counter bids for Just Eat.

While that bidding war was put to bed recently, it, along with this latest investigation from the CMA, underscores how fiercely competitive the food delivery market is getting, and just how thick in the middle of a consolidation process it is. With demand for off-premises orders set to drive restaurant sales for the next decade and investors applying pressure for these companies to show the third-party delivery model can be profitable, companies across the space are shutting down services, selling their operations, and, at least in the case of the big guys, gobbling up the smaller players. 

For its part, Takeaway.com said it was confident that clearance on the merger “will be obtained.” Now we’ll have to wait and see if that really does mean a simple one-week delay or if the two companies have a longer, more complicated battle on the horizon.