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Panera Sells Groceries, Instacart Expands Delivery Windows As More Shoppers Eat At Home

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As social distancing and shelter-in-place orders expand, consumers are eating more meals at home — and the fallout of this behavior is affecting both grocers and foodservice operators. Instacart is taking advantage of the recent surge in demand by rolling out additional delivery options, while Panera Bread is seeking to shore up its operations through the sale of grocery items.

Instacart’s newest offerings are Fast & Flexible, which matches customer orders with real-time shopper availability, and Order Ahead, which lets customers place orders up to two weeks in advance. The company has been testing these options for the past few weeks as part of an effort to keep up with massive demand spikes: order volume was up 300% year-over-year during the week of March 30, and average basket size was up 25% month-over-month during March. 

Fast & Flexible automates the delivery process by matching orders to the first available shopper, rather than checking back with customers to offer available delivery windows. Customers can still expect an estimated delivery range, such as “Tuesday through Thursday,” and will be notified when their order is scheduled for delivery.

Instacart reported that Fast & Flexible increased available delivery windows by 50%, and that 85% of all Fast & Flexible orders arrived during the earlier portion of the estimated delivery range during the pilot. The option is available for all orders that don’t contain alcohol.

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The Order Ahead feature was introduced to give shoppers an opportunity to plan ahead, which is more in line with the pantry-stocking habits people are following during the COVID-19 pandemic. Order Ahead is already available in high demand locations and will roll out across North America over the next several weeks.

Instacart has been taking other measures to keep up with rising demand, including growing from 200,000 to more than 350,000 active shoppers; introducing contactless “Leave At My Door” delivery; and automatically cancelling out-of-stock orders.

In comparison, Panera Bread is pivoting due to a lack of its traditional business, according to CNBC. The QSR will sell bread, bagels, milk, yogurt, cream cheese and fresh produce to help offset the loss of business caused by temporarily shuttered dining rooms: restaurant transactions nationwide fell 42% year-over-year during the week ended March 29, according to the NPD Group.

Panera Bread estimates that it lost half its business once its dining rooms closed. However, the restaurants will now serve as location where customers can pick up groceries ordered through Panera’s app or web site, though customers can still choose to have them delivered.

“It’s a win for our associates because we will be able to keep our cafes open longer, and it’s great from a business standpoint because it should be incremental profit and revenue for us at a time when we desperately need it,” said Niren Chaudhary, CEO of Panera Bread in an interview with Retail TouchPoints.

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