How Will it Affect Delivery Drivers' Strategy

Instacart’s Venture into Food Delivery: How Will it Affect Delivery Drivers’ Strategy?


Screaming headlines popped up all over the place recently, announcing big changes at Instacart. “Instacart to deliver meals” and “Will Instacart pose challenges to DoorDash?” are just a couple of examples. Is it true? Does Instacart deliver food now? What is Instacart’s foray into food delivery all about, and how (if at all) should it change your driving strategy? In this blog post we’ll explore these questions and more, including:

What exactly is Instacart doing?

To read the sensational claims in the Instacart articles released during the mid-January launch, you might think this was going to shake the entire delivery industry to its foundations. When we examine things more closely, we find that while this is an interesting move by Instacart, it might not change the whole world.

Instacart is pumping up its capability to deliver prepared food to its grocery delivery customers by highlighting these products in a “Ready Meals Hub” on its app. The hub looks like this: 

The cute message inside the circle, “Break up with take out,” makes it sound like Instacart is trying to woo customers who’d normally use DoorDash, GrubHub, and other companies that focus on restaurant food delivery. This is only partially true.

Instacart is actually pushing the prepared foods you’d find in most grocery stores. These might be sandwiches, salads, sushi, desserts, or reheatable fare such as meats, casseroles, and side dishes. This is interesting because even though these products don’t compete head-to-head with restaurant take-out, they do satisfy a certain kind of customer. 

In a January 14, 2022 article, Produce Blue Book cites statistics that show how much these items play a part in the meals being consumed in North American homes. For instance, some 73 percent of meals are prepared at home, but most include time-saving items that don’t need to be made from scratch. More than 50 percent of meals consist of a blend of homemade and ready-made foods, and most of those (64 percent) include the pre-made salads and pre-cooked meat dishes Instacart is pushing in its new in-app hub.

The part where Instacart is trying to compete with Uber Eats and DoorDash is its attempts to push those companies out of the grocery delivery business. Both Uber Eats and DoorDash have been flirting with grocery delivery, and they’re aggressive when it comes to grabbing up their shares of the market. 

That’s where Instacart’s move, to highlight adding prepared foods to its repertoire, begins to make a lot of sense. Let’s see what it might mean in terms of more ways for you to earn money as a shopper/driver.

What opportunities will Instacart ready-made meal delivery create for drivers?

The Ready Meals Hub on the Instacart app will make it easy for customers to order prepared foods from top grocers, such as Publix, GIANT, Food Lion, Hannaford, Stop & Shop, Martin’s, and Kroger, with ShopRite being added in the next few weeks. What does this mean for Instacart shopper/drivers?

In total, the Ready Meal Hub will provide service to more than 4,100 stores. Once customers can add these freshly made items to their grocery lists, they will undoubtedly create bigger baskets, and bring bigger bucks to Instacart shopper/drivers. What’s more, the pre-made food market has been growing and is expected to expand widely in the near future. 

The previously cited Produce Blue Book article discusses analytics from the firm Research and Markets, showing that the market for chilled and deli food was estimated at $40 billion in October 2021. This market is projected to reach more than $108 billion by 2026 – and if these projections come to fruition, it could mean great potential earnings for Instacart shoppers.

According to Bloomberg and YipitData, Instacart held 52.6 percent of the grocery delivery market in November 2021, and the company has every intention of holding onto that. Instacart’s acquisition of FoodStorm, an order management system that automates the end-to-end, order-ahead, and catering processes for grocery retailers, will certainly help. 

TechCrunch reports that Instacart’s ambitions for the future spring from a highly successful year in 2021. Instacart claims that orders grew more than 30 percent year-over-year. This can be attributed to other moves Instacart has made, including the launch of a Convenience Hub in September 2021. 

With this hub, Instacart extended its shopping and delivery services to customers who just want a little something. Their new Dollar Store Hub was launched to give customers access to the wares available at 14,000 low-end giants as Dollar Tree, 99 Cents Only, Family Dollar, and Five Below.

By making these moves, Instacart is increasing the likelihood that Instacart driver pay will be on the rise. But what about the work side – what will shopper drivers have to do? Many of the new features Instacart is offering include promises to customers of deliveries in “30 minutes or less.” 

This Gridwise blog post details a new service from DoorDash, and tells you a lot about what “quick delivery” means to shoppers and drivers. To satisfy any “quick delivery” requirements, you’re going to need more than a few Instacart tips and tricks.

Keeping up with tight delivery times can bring on pressure you might not be looking for. Keep in mind that your turnaround has the potential to be influenced by traffic patterns and volume. What’s worse is, you’re not the only party in the picture.

Grocery workers complain that there is too much pressure on them to take care of those fast turnarounds, too. They’ll be responsible for what is probably the most crucial part of your efforts to deliver Instacart meals in 30 minutes or less. That means you might really only have 15 minutes, or maybe even 10, to make it through the store, get back into your vehicle, and arrive at the customer’s doorstep.

In general, the new services Instacart offers can turn a regular food shopping job into a more interesting and lucrative delivery gig. Instacart is still the #1 grocery delivery company in North America. The company has partnered with more than 700 retailers, and delivers in 5,500 cities from 65,000 different stores. 

More than 85 percent of American households, and 90 percent of Canadian households, have access to the Instacart program. The Instacart Express membership gives customers benefits such as reduced service fees and unlimited free delivery on orders over $35. When customers pay cheaper fees for delivery, they have more money left over to tip you!

How will Instacart’s move affect DoorDash, Uber Eats, and Shipt?

If you’re a food delivery driver, you might be concerned that Instacart is moving in on the food delivery business. But according to what Instacart’s Head of Product, Daniel Danker, said to Bloomberg, the company remains focused on partnering with grocery stores.

As pointed out earlier, the more accurate way to look at Instacart’s move is as a way to counter attempts by Uber Eats and DoorDash to move into the grocery delivery business. The Ready Meals Hub is more of a counter-move on the part of Instacart, which wants to keep its stronghold on the grocery delivery market. 

There are some ways, though, that this could potentially change the balance of market share among the major delivery companies. For instance:

  • More customers might switch to ordering pre-made meals rather than restaurant food or going out to eat. This could hurt DoorDash, Uber Eats, Grubhub, and others.
  • Instacart could woo Shipt customers into moving away from that company because Instacart can offer ready-made meals as well as regular groceries on their app.

It’s hard to know what might happen when it comes to finding the best apps to earn with, but you can get a leg up by using Gridwise. You’ll be able to monitor your own earning trends right on the app. Simply sync all your driving gigs with Gridwise, and compare the results on insightful and easy-to-read graphs like these:

Also, be sure to check the Gridwise blog for current data on earnings across all the driving apps. These Gridwise articles cover 2021 driver earnings for: 

Each of these articles provides the data and insight that you need when choosing a company for your driving gig.

Is Instacart a good move for you?

There are a few factors you’ll want to look at before knowing whether Instacart could work for you. The first is whether the stores that will offer the products on the Ready Meals Hub are common where you live.

After all, if people aren’t searching for terms like “Instacart Publix” or “Instacart Food Lion” in your neighborhood (because they don’t operate where you live), you probably won’t be able to benefit from the Ready Meals Hub offerings. Keep in mind, though, that other stores, such as Aldi and Kroger, will still offer you the chance to deliver groceries for Instacart. Once you’ve established that Instacart’s Ready Meals Hub will operate in your area, you’ll want to ask yourself:

  • Do you mind shopping on top of delivering?
  • Does the 30-minute delivery window seem reasonable to you?
  • Are Instacart earnings as high as yours are at the moment?
  • Do you think Instacart earnings will grow now that the Ready Meals Hub has launched?
  • Is it worth losing your ratings and perks from your other app in order to switch to Instacart?
  • Will you be able to make more money with Instacart than you do with your current company?

You’ll have to decide if the new Instacart offering is as wonderful as the headlines suggest, and then determine if it’s enough to entice you to be an Instacart shopper. No matter what you choose to do, though, bringing Gridwise along on all your driving gigs will help you find out where the earnings are really at.

Gridwise’s Where to Drive and When to Drive features show you data from actual shoppers and drivers in your area. This makes it easy to see what others are earning from the various apps. For every statistic you want to see, you can select the gig service category that interests you: Rideshare, Food, Grocery, and/or Package Delivery.

Ready to see whether Instacart is worth the hype? Track your earnings with Gridwise to find out!

Download Gridwise now!


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