The Future Of Shopping Is Virtual


Peapod is stealing a page from Tesco and trying out virtual shopping inChicago, where commuters now encounter shelves of virtual product in the subway tunnel, making it easy to scan and buy groceries en route.

This kind of virtual grocery shelve has been held up as the next great innovation in retail ever since Tesco launched its program in the subways of South Korea last summer. It’s Home Plus stores there sponsoredvirtual grocery aisles, enabling commuters to scan QR codes and have orders delivered directly to home.

Ahold– owned Peapod debuted a similar initiative in Philadelphia  earlier this year with 15 locations. The program has since been narrowed down to the nine most successful locations, according to Peapod spokeswoman Elana Margolis. Now the program has been expanded to Chicago, where Peapod has taken over a 60-ft. pedestrian tunnel at the State and Lake CTA station in the city’s Loop.

Commuters can scan download Peapod’s mobile app, scan a QR code from the virtual shelves and start shopping while in transit. It’s about building awareness for peapod and capturing new customers, according to Thomas Parkinson, Peapod co-founder and chief technology officer.

“This whole thing is built around customer awareness and acquisition,” he told me in telephone interview this morning. “There’s a huge difference in sales for us when (you add) mobile.”

The average Peapod shopper spends $160 per order on the Internet, says Parkinson. Those who shop exclusively using a mobile device — and that includes tablets — spend $165 per order. But if shoppers use both online and mobile in some combination, they spend $168 per order. Given that Peapod shoppers order roughly every two weeks, it’s a significant incremental bump in sales.

And mobile is an increasingly large part of Peapod’s business. “Roughly 20% of our business has been touched by mobile,” Parkinson says. “In one year there’s this huge sucking sound of our customer base moving to mobile. It has increased both sales and basket sizes.”

Already Peapod is gaining big shopper insights from the initiative. They can see how many items people scan — typically one or two from the virtual assortment — how they continue to build a shopping list and from what device. New customer are being acquired a pretty rapid clip and it doesn’t hurt that the program is half paid for by its vendor partners. Big names like Coca-Cola, Procter and Gamble and Kimberly-Clark.

“It was no-brainier to sign them up,” says Parkinson. A 70 foot billboard and impulse buy opportunity in one of the most trafficked stretch of Chicago just doesn’t come along every day. But it could soon. If Peapod’s early enthusiasm for the initiative is any indication, the future of retail is indeed virtual.


Posted on June 22, 2013, in Bussiness, News and tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink. Leave a comment.

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