“I’m Gonna Lose My Job” -Instacart And Walmart As Bezos Invades 2,300 Cities With Fresh Delivery

“Now I’m panicking. I’m gonna lose my job. I’m gonna lose my house. I’m gonna lose everything.” – Every grocery store in America

Welp, the rumor mill was right. Jeff Bezos’s fever dream of dropping strawberries, milk, and a random set of Allen wrenches on your doorstep in the same box has gone from “haha wouldn’t that be wild” to “oh s**t, he actually did it.” Amazon just fired a missile straight into the grocery business, announcing plans to roll out same-day fresh delivery to 2,300 cities by year’s end… more than double its current turf. And since it’s already live in 1,000 spots, that’s gonna be a piece of cake (I mean this is Amazon we’re talking about). 

Speaking of cake, that noise you hear? That’s Instacart’s board stress-eating a sheet cake straight from the pan. They’re trying to figure out how to tell shareholders they’re about to go toe-to-toe with the evil-laughing emperor of modern commerce: Jeff Bezos.

Luckily for you, if you’re a Prime member and your cart’s over $25, the delivery’s free. Under that? $2.99. If you’re not a Prime member, it’s $12.99 no matter what… basically the “tax for not bending the knee.” Amazon tested this last year in Phoenix and quickly noticed something: when people started buying perishables, they came back twice as often. Now they’re rolling it out nationwide… because if there’s one thing Amazon’s good at, it’s finding your (or your wife’s) weakness and turning it into recurring revenue.

As you’d imagine, the announcement shaved billions off competitors’ market caps almost instantly. Instacart got crushed (-11%), Kroger fell -4%, DoorDash (-3%), Walmart (-2%). Even Target and Costco felt a pinch. As far as Amazon, well it only lifted their stock 1%... which ironically puts their performance at (checks notes) just under 2% for the entire year (thank you, Donald).

Wedbush analysts dubbed it “a shot heard round the warehouse,” and they’re not wrong. Grocery is still the biggest retail category out there and one of the last true boss levels for e-commerce to conquer. Walmart, for example, gets more than half its revenue from groceries, so this is basically Bezos walking up to the throne and asking, “You gonna finish that crown?”

Amazon’s been poking around the grocery game for years… dropping $13.7B on Whole Foods in 2017, experimenting with those Fresh stores no one could quite figure out, tacking fees onto Whole Foods delivery, and putting the whole empire under CEO Jason Buechel earlier this year. But until now, perishables at scale were the one puzzle piece they couldn’t snap in. This rollout could be the moment Jeff finally solves it… and then sells you the solution in two hours or less.

And don’t forget, as I wrote awhile back… Amazon isn’t just going after people who live in townhomes and stroll to their corporate jobs downtown. Back in June, they announced a $4 billion plan to bring same-day and next-day delivery to 4,000 rural communities. So they’re taking this baby from sea to shining sea.

And look, I get it… people (me included) love to roast Jeff Bezos for his cartoon-villain laugh and world-domination energy… but in this case, is it really a bad thing? Competition forces everyone to step up, and a rising tide lifts all boats. Which means at the end of the day, consumers win.

(Source: AP News)

So if you’re Kroger, Walmart, Instacart, or literally any grocery store in America, this is your “get your sh*t together” moment (or don’t, and enjoy the slow march to bankruptcy). Because at the end of the day, shoppers are gonna win here. Hell, maybe next time I do a Kroger pickup, I won’t open the bag to find bruised apples and a box of donuts where my ice cream was supposed to be.

At the time of publishing this article, Stocks.News holds positions in Amazon as mentioned in the article.