Publix Wades Into Troubled E-Grocery Waters

Share this article:
PublixDirect, the Internet arm of Publix Super Markets Inc., Lakeland, FL, yesterday began delivering orders to 13 postal codes in the greater Miami area for its first foray into e-commerce.

The supermarket chain, which has 650 stores in Florida, Alabama, Georgia and South Carolina, has opened a distribution center in Pompano, FL, for the initiative. The Web site offers 9,000 items, including baked goods, produce, meat, canned goods, laundry detergent and beauty supplies.

Publix started sending e-mails this week to past customers in the area who had asked to be notified when the service began. Direct mail to 5,000 households in the trial ZIP codes was sent the next day.

Viewers must place $50 minimum orders and select delivery times, which are available every day but Friday. To attract customers, PublixDirect is waiving its $8 delivery fee for the first 30 days.

Numerous bankruptcies in the online grocery industry -- most notably Webvan -- have left analysts certain that the expenses of customer acquisition and fulfillment along with industrywide tight margins make turning a profit in this sector nearly impossible.

"Clearly, we're in a testing mode," Tom O'Connor, president of PublixDirect, told the Miami Herald. "We're taking it day by day. We've been surprised we've gotten as many orders as we did."

PublixDirect does have advantages that Internet-born firms like Webvan never did, namely an entrenched brand in the Miami area that could relieve it of high customer acquisition costs. PublixDirect also can offer lower prices than Webvan because of long-standing relationships with food wholesalers.

However, the company still will have to balance the cost of operating its fulfillment warehouse to turn a profit.

A Publix spokeswoman said her firm would hold a press-only tour Oct. 4 at the fulfillment center.

Share this article:

Next Article in Digital Marketing

Follow us on Twitter @dmnews

Latest Jobs:

Featured Listings

More in Digital Marketing

News Byte: CX Scores to Take Their Place Beside Price Listings

News Byte: CX Scores to Take Their Place ...

E-commerce aggregator PriceGrabber will begin offsetting price info with service expectations.

Data Byte: Interactive Ad Revenues Exceeding TV for the First Time

Data Byte: Interactive Ad Revenues Exceeding TV for ...

At nearly $43 billion, interactive advertising revenues exceeded broadcast for the first time in 2013.

Marketers: Data Rich and Knowledge Poor

Marketers: Data Rich and Knowledge Poor

While advertisers have become incredibly data-savvy, the most difficult challenge remains causally linking that data to outcomes that really matter.