Instacart expands high-tech grocery delivery, with hopes of helping grandma
Instacart has become a darling of the new tech economy by combining cutting-edge software with an on-demand labor force of smartphone-wielding grocery couriers. For its next act, the company wants to help aging residents navigate the necessities of hometown living.
Instacart is expanding to 17 new ZIP codes in Massachusetts on Tuesday, adding Dedham and communities in the North Shore to its existing footprint in Greater Boston.
The San Francisco-based company, which allows users to order groceries online for delivery in as little as an hour, was considering areas north and south of Boston for its next expansion, with compelling business reasons to pick either option, regional manager David Schloss said.
But in the end, Instacart was nudged north by an idea most people might not associate with a trendy tech startup: the recent push by officials in Salem to offer more services for older residents.
“We said, `Hey, we really want to be a part of that,’” Schloss said. “That was the tiebreaker.”
Salem isn’t necessarily an elderly community. Only about 8,000 of its roughly 45,000 residents are senior citizens today, Mayor Kim Driscoll said. But the city also expects the number of residents between the ages of 65 and 74 to nearly double by 2030, and officials want to be prepared for that demographic surge.
Like many communities, Salem has services to help seniors, including vans to transport people on errands around town or pedestrian crosswalk signals that give a little extra time to get across the street.
Driscoll hopes a service such as Instacart can supplement those public services. And since many older residents have already mastered modern tools like Facebook, there’s a good chance that Internet grocery lists won’t be too foreign, she added.
“Over the next 20 years, with the Baby Boomers aging, there’s going to be a range of individuals — many of whom will be more tech-savvy,” Driscoll said. “We’re still going to have vans that are driving people to the grocery store. But if we can complement it with a service like this, we might be able to meet more people’s needs.”
Instacart has about 7,000 active users in the Boston region, and it hopes to more than double that number in the next year. The company also has about 100 employees and some 300 delivery contractors in the Boston area, with plans to hire up to 50 more contractors for the new expansion.
The added Massachusetts delivery areas are among the company’s first forays beyond major cities and their nearby suburbs, Schloss said. The economics for such a move make sense for the company because of improvements in its software systems, which give Instacart a better idea of when to schedule shoppers and how to route drivers so that multiple deliveries can be made at once, he said.
Instacart charges $5.99 per delivery, although frequent shoppers can pay $150 per year to waive all delivery fees. Customers select items from familiar local stores, including Market Basket, Costco, VinoDivino, and Star Market.
In some cases, Instacart marks up retail prices for delivered items. In others, it collects fees from retailers to be their official delivery service and charges shoppers the same price they’d pay in stores.
Correction: An earlier version of this story had the wrong number of ZIP codes in Massachusetts covered by Instacart’s expansion. The correct number is 17.