With Connected Stores, Instacart Continues Push to Become Technology Platform Partner for Grocers

Today Instacart announced a new bundle of technologies aimed at helping retailers digitally power their storefronts. A mix of existing and new products, the new suite is a sign of Instacart’s continued effort to transform itself from an in-store shopper and delivery services company to an omnichannel grocery technology arms dealer.

The Connected Store suite of technologies includes the following:

A new and improved Caper cart: The new suite includes a third generation Caper cart. Like the second generation Caper, the new cart allows customers to drop their items in the cart and the Caper adds it to the list without a barcode scan, but it is 65% larger, has a longer-life battery, and is designed to work well in inclement weather.

Scan & Pay: For retailers who choose not to deploy Caper carts, Instacart is introducing a new service called Scan & Pay. Scan & Pay allows shoppers to scan and pay for products with their phone. The service looks especially helpful for EBT Snap users, who can scan items to identify whether they are EBT SNAP-eligible.

lists: Lists syncs up a shopper’s personal shopping list with the Caper cart app or a grocer Instacart-powered app. Items are imported into the Caper list and checked off when you drop them in your cart.

Department Orders: The Department Orders feature enables coordination between grocery store prepared food departments by enabling them to sync orders. For example, the bakery can coordinate with the deli to enable orders to be ready simultaneously. The new feature is powered by Foodstorm, a food service order management platform the company acquired last year.

Carrot Tags: Maybe the most innovative new feature of the new Connected Stores bundle is Carrot Tags. A customer can find items in-store by clicking them on their phone, which lights up a corresponding electronic shelf label. As someone who often has trouble finding items on his shopping list, I can see Carrot Tags coming in pretty handy.

As I wrote last year, Instacart’s acquisition of Caper and continued development of digital transformation technologies is a sign the company is trying to transition to become an enabling platform player for grocers.

As Instacart grows its enterprise technology solutions, I expect we’ll increasingly see its flagship shopper service decoupled from its technology as it looks to serve larger retailers who want greater control over the customer relationship. Since the start of the pandemic, many grocery retailers have started to roll out and standardize around their delivery services, which means a fast-growing market for technology solutions. My guess is that Instacart is anticipating this as it rolls up some of the best-in-class independent solution providers as it prepares for an IPO soon.

With Connected Stores, Instacart is attempting to integrate what has seemed to be a loose grab-bag of technologies assembled mostly by acquisition into a cohesive suite of technologies. It’s an evolution that makes sense for the company strategically and for its collection of platform products, even if it does still feel the suite is much a re-naming and branding exercise as it is an actual integration across products. As part of the effort, the company is trying to showcase the full vision with its first partner store in Good Food Holdings’ Bristol Farms store in Irvine, California. According to the announcement, Good Food Holdings will also use Instacart’s Storefront Pro software to power its online store.

The news of the Connected Store platform comes as the company readies for its IPO, which it filed for in May.

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