US grocery giant Kroger is clawing back on an initiative to build out its network of robotic-warehouse-powered delivery services. Not because the technology doesn’t work (it does – Kroger was using the UK’s grocer Ocado’s proven robots), but because US consumers demand instant delivery.
With its automated fulfillment network, Kroger bet that consumers would be willing to trade delivery speed for sensible prices on grocery orders. That model has been highly successful for Ocado in the U.K., but U.S. consumers have shown they value speed of delivery, with companies like Instacart and DoorDash expanding rapidly in recent years and rolling out services like 30-minute delivery.
It goes to show that it’s not just technology that makes or breaks a business model.
