SAME DAY DELIVERY Strategic Bets, Emerging Solutions, Path Forward
What is Last mile? Movement of goods from the last inventory point to the point of consumer chosen access Retailer DC Home or Office Retailer Store Lockers Manufacturer DC Store for Pickup Converted / Dark Store
U.S. last mile delivery is $27B and growing Last Mile Rapidly Growing Same Day Emerging $27B market 10% CAGR 2% of online orders $0.6B market Significant CAGR in urban US Same Day Forecast in 20 Cities 2014 2015 2016 2017 2018
Same day seen as a strategic bet today Argument For 60% of Millennials expect Same Day 52% consumers willing to pay for Same Day Argument Against Supply side innovation show consumers what is possible (Amazon effect) Modest 9% of shoppers said Same Day will lead them to buy more online Majority of consumers still want low delivery cost over speed Will not scale beyond dense urban centers
Role of Same Day in omnichannel? How important is Same Day delivery in driving omnichannel growth and retailer differentiation? How fast will Same Day grow in the next 3 years? Which segments and occasions? How does Same Day delivery fit within the retailer s broader omnichannel strategy?
Several Same Day models emerging Retailer Managed 3PL Managed (Owned) 3PL Managed (Crowdsource) Marketplace (Crowdsource) Marketplace (Outsourced) Each type has its own structural pros and cons in terms of Cost Adoption Scale Flexibility Control Innovation
Emerging solutions Provider View Please describe your Same Day offering? How is it different than other solutions? Google and Instacart are marketplace based what are the demand and supply side drivers for scaling in a region? Which geographic and category segments are you in today? Where do you plan to be in 3 years? What aspect of your solution do customers love today? How does your platform enable innovation beyond speed?
Google Express The Stores you Love Delivered Fast Google Express Privileged & Confidential
48 Merchants Platform for merchants Google Express
Google Express Same Day + Overnight Delivery overnight
Infrastructure Free Grocery e-commerce Consumers Retailer Marketplace Grocery Stores 1 Hour/Same-day Delivery & Pick-up Double Digit M-o-M Growth 18 Major US Metros and Growing 100+ Retailer Partners $275MM+ in Funding 11
18 Markets and Growing Seattle Portland San Francisco Bay Area San Jose Los Angeles Boulder Denver Minneapolis Chicago Indianapolis Atlanta Boston New York Philadelphia Washington, D.C. Austin Houston Miami Current City www.instacart.com/locations 12
Industry defining offering driving a differentiated customer experience Rich, digital customer experience Ability to engage with customers Cutting edge technology enabling unmatched service Visual and UPC/PLU based confirmation of desired items Sophisticated fulfillment algorithms to ensure timeliness, flexibility and efficiency Instacart receives high praise from its customers for its clean, easy-to-use interfaces that instantly sync across customers devices Active Substitution Management Engage proactively while in the store text, email, phone Intelligent in-store technologies to ensure efficient picking/packing/ check-out Monitor performance and make it right no matter what! 24 hour customer service 13
Adoption considerations Retailer View Are you piloting Same Day solutions today? What are the trigger points for scaling a Same Day program? How does Last Mile fit within your broader omnichannel strategy? What are you looking for in a scalable solution? What do you need to see in terms of (performance, referencing, strategic considerations)?
Path forward Tell the audience something we don t know about Same Day How and what technology will materially enable Same Day delivery in the next 3-5 years? Where will Same Day be in 3 years from now?
Thank you please continue the dialog! Vishwa Chandra VP Retail Accounts, Instacart vishwa@instacart.com Brian Elliott - GM Google Shopping brianelliott@google.com Marie Robinson - COO Michael Kors marie.robinson@michaelkors.com Dwight Herlong VP Supply Chain icracked Inc. dwightherlong@yahoo.com Raj Kumar raj.kumar@atkearney.com Mike Hu michael.hu@atkearney.com