May 17, 2001

Extra helping: Beta-testing the online grocery service Peapod

Author: JT Smith

- By Joab Jackson -

Cyberpunk -

As luck would have it, I live in one of the test markets for the
Internet grocery-store service Peapod. Instead
of fighting the Saturday-morning shoppers, I just "surf" over to the
Peapod site, check off the products I need, and pay for them by credit card. A
day or two later, burly men deliver these goods to my door.I love the idea of online grocery shopping because I hate actual
grocery shopping. I won't lose sleep over not squeezing the fruit, or checking
to see if the dead fish's eyes are clear.

Still, I do have a few minor issues with the Peapod service.

Chief bitch is the process of ordering foods by name. Peapod has
this weirdly schoolmarmish insistence on proper spelling. If you're looking
for a particular food or brand-name product -- say, a delicious box of State
Fair Mini Corn Dogs -- you enter the name of the desired good into Peapod's
search engine and it points you to the appropriate "aisle." But here's
the rub: You must type the product name exactly. It doesn't care if you're
in a hurry or can't spell. Unlike a spell-checker, the search engine won't
return a list of nearest misses. I've found that "spagetti" won't deliver you
to the pasta aisle. Nor will "spaggety." "Tolet paper" will get you no
toilet paper, "burritoes" no burritos. Even more troublesome are all those
gimmicky brand names. Those who feel smug about their spelling prowess can take
this little quiz: Which, if any, of the following product names are spelled
and punctuated correctly? 1) Chef-Boy-R-D; 2) Little Debbie's; 3)
Chee-Toes; 4) Kibbles and Bits.

Shopping Peapod requires a whole new knowledge base -- one that
isn't developed by absent-mindedly grabbing colorful boxes off of shelves. As
a result, my diet has shifted heavily to the single-syllable food group.
It's just easier that way.

Delivery also turned out to be problematic, strangely enough.
Believe it or not, grocery delivery can be a time-sink. Don't get me wrong --
Peapod's punctual. My delivery crew has shown up on time on every occasion but
once -- when they didn't show up at all. Instead, on that night, I got a
call around 1 a.m. from the local police department asking if my delivery
was made. Evidently, the driver absconded with a truck full of groceries. I
never did find out what happened to him, nor did the guy who brought my
replacement order the next day. I didn't mind though. Not only did I
got a $15 credit for the trouble, I kind of relished my vision of this driver
and his assistant madly speeding across the country in a refugee Peapod
van, subsisting off my generous order of Hostess chocolate donuts and Diet
Mountain Dew.

Still, even when your parcels aren't hi-jacked, which, like I said,
probably doesn't happen that often, you still have to set aside a two-hour time
frame, at least one day in advance, in which you'll definitely be home
in order to receive your packages. It's like getting the phone hooked up
or having a dentist appointment. It can take a bite from your day.

And when the foodstuffs arrive, they do so in huge blue crates. I'm
talking airdrop-size, extra-reinforced boxes, wheeled in on handcarts.
Totally uncool. I mean, geez, I don't buy that much. I know I should be
beyond worrying that my neighbors might think I'm Hugo, the world's
fattest apartment dweller, a man so voluminous he can no longer fit through his
own door and must subsist on crates of chow provided by The National
. But I'm not beyond it. Sorry.

Other than those quibbles, I enjoy Peapod just fine. The only thing
is, I can't figure out how the company will make money when it scales up
beyond the test markets. It couldn't possibly profit off of the delivery
charges alone, which run from $5 to $10 (plus a tip to the poor guy hauling the
damn crates).

At first I thought Peapod must profit from big price markups. But
when I compared the prices of some randomly chosen (yet easy-to-spell) items
from the local supermarket chain that supplies Peapod in this area with
Peapod's own charges for of those items, I found they were identical. Peapod
even accepts coupons, if you're into that sort of thing.

Maybe, I next figured, Peapod could be shortchanging workers. After
all, competing online grocer Webvan has
been charged by the National Labor Relations Board with preventing its
employees from joining the United Food and
Commercial Workers.
Could Peapod be hiring nonunion workers to
underprice union-wage-paying supermarkets?

Maybe not. UFCW spokeswoman Jill Cashen assured me that all the
Peapod employees, where I live anyway (northwest Washington, D.C.), enjoy union
protection. Hopefully, this union influence will have an effect on the
wages and benefits of all Peapod delivery and warehouse employees, for whom
the gravy wages and healthy perks of the hi-tech sector are anything but

Certainly the market is there for this service, even if it is growing
less dramatically than anticipated. Even in this bear market,
Business Week
took a liking to the concept, noting how
customer loyalty runs high with such services. I agree. I certainly wouldn't
want to ever spend time again waiting in long supermarket lines if I had my
choice about the matter.

Still, the grocery biz labors under some pretty razor-thin margins even
without delivery services. And a business can't stay afloat simply by
providing good jobs and easing the lives of social recluses. Only when
I visited the "Investor Relations" page of Peapod's Web site, where this
Skokie Ill.-based company's business plan is explained, did I
understand the Master Plan: Peapod intends to rake in the bucks by becoming "the
'gateway to the home' for groceries [so] it can extend into other categories and
revenue streams."

"Gateway to the home"? That's so dot-com. I hate to break it to
Peapod, but the only gateway it'll find via my home is the one into bankruptcy.
Hey, Little Debbie cakes are an extravagance in this household. So what else
could Peapod possibly shill?

Maybe a dictionary.


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