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Publix still tinkering with its curbside pickup option

For the past year, Amy Bauerlein has done her grocery shopping online at Publix Curbside in Citrus Park even though it required a 10-minute drive to pick up her order.

"I don't care about the drive," said the 31-year-old schoolteacher and mother of two. "I'm saving time by avoiding the crowds, not standing in line and not (confronting the temptations of) impulse buying. I save $25 to $50 a week."

Those are not words grocers love to hear. But the sentiment is driving many supermarket chains to realize they misread how online shopping works when they blew hundreds of millions on ill-fated, home delivery 15 years ago.

"It's become clear online food shoppers want to avoid what they don't like about the shopping experience, not the drive to get there," said Greg Buzek, president of IHL Services which tracks retail tech trends.

As Publix's test of curbside celebrates its first anniversary this month, the Lakeland chain is stepping up promotions in ads, in signs at nearby stores and on social media like YouTube.

Still, Publix, which lost $50 million before closing its Publix Direct online home delivery supermarket in south Florida in 2003, is taking it slow this time. The chain still offers the program at just one Florida location — 7835 Gunn Highway in Hillsborough County — and two others in Atlanta. It has no immediate plans to expand the curbside program to other stores.

For $7.99 an order, Publix Curbside (publix.com/curbside) uses trained pickers to fill online orders from the store aisles. They hold the order for pickup from 8 a.m. until 8 p.m. seven days a week. For grocers, curbside pickup is simpler, cheaper and less hassle than asking customers to wait for a two-hour home delivery window.

The time savings is real. A Publix picker's trip fetching 28 items including wine and deli items on Friday clocked in at 33 minutes despite a handheld computer that laid out the quickest path.

"Customers love curbside, but we are still tweaking how we do it" before deciding to add more stores, said Shannon Patten, chain spokeswoman.

For instance, one Atlanta Publix store uses a drive-through. A second is housed in its own storefront. The Tampa version uses three call boxes in the parking lot so customers never leave their car.

Nationally, only a few home delivery online supermarkets like Fresh Direct and Peapod survived. They stick to the most densely populated parts of the country, places like Manhattan, Chicago and Boston. Amazon.com now delivers fresh perishables in a few cities in the Pacific Northwest. Walmart.com is testing a similar delivery service, but only in Silicon Valley.

Publix is among many supermarkets that use My Web Grocer, a Vermont firm that supplies the technology backbone for the curbside program. The company runs similar services for 60 food chains in 1,000 stores, offering home delivery and store pickup.

"By a three-to-one margin shoppers prefer to pick it up themselves," said Rich Tarrant, founder and chief executive.

Grocers cannot dawdle too long to get in the online game. The tech savvy under-30 set, not yet old enough to be big grocery buyers, will demand digital options.

Only 2 percent of sales of packaged goods — most of what you find in a grocery store — are done online, less than a quarter of the figure for all general merchandise. But Nielsen Research forecasts that will double to $24 billion by 2014.

Nielsen found online food shoppers spend twice as much than the average shopper, because they are more affluent and they buy bigger quantities when they don't have to lug a 24-pack around a store. They also consolidate purchases. That makes them less likely to hit a drug or discount store after ordering online from a grocer that sells the same stuff.

Publix found that the most likely prospects are:

• People with children at home who feel more pressed for time, although growing numbers of older baby boomers are joining them. Their fear of getting stuck with poor produce and meats vanishes after a couple of good experiences.

• Shut-ins and the disabled who have trouble navigating stores.

• People looking for a tool that instills diet or budget discipline.

• Some surprise users: hotels with no restaurant that cater meetings, office workers who combine and send deli sandwich orders online, and cooks who whip up dishes for celebrity chefs on HSN.

"My guess is pickup in a store for a fee is going to spread faster," Tarrant said. "The limiting factor has not been customer demand, but retailers experimenting with it only in small doses."

Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.

Publix still tinkering with its curbside pickup option 08/29/11 [Last modified: Tuesday, August 30, 2011 3:24pm]
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