Instacart
Instacart used to have exclusive rights to Whole Foods delivery. That changed when Amazon acquired the grocer.
- Instacart is a delivery company that pairs customers with personal shoppers who deliver groceries to their homes.
- In 2016, it signed a five-year contract with Whole Foods to become its exclusive delivery partner. In 2017, Whole Foods was acquired by Amazon.
- Instacart now goes head-to-head with Amazon's own Whole Foods delivery services, including Amazon Prime Now.
- We put the two competitors to the test.
Up until last year, there was only one way to have Whole Foods produce delivered to your door: via Instacart, a delivery company that pairs customers with personal shoppers who pick groceries in the store and deliver them directly to people's homes.
This changed in June 2017, when Amazon announced that it would be buying Whole Foods for $13.7 billion. The announcement sent shockwaves through the market and put Instacart, which had exclusive rights to Whole Foods' delivery, in a sticky situation.
In a recent interview at Recode's Code Commerce conference, Instacart CEO Apoorva Mehta explained how Whole Foods' CEO, John Mackey, called to personally inform him about the deal when it happened.
"It was probably a one-minute call," Mehta told Recode journalist Jason del Rey. "He wanted me to be one of the first people to know."
In the months that followed, Instacart signed deals with several major US retailers including Sam's Club, Costco, CVS, Albertsons, and Kroger, but industry experts were left wondering what would happen to the five-year contract that it had signed with Whole Foods in early 2016 and was only a year and a half in to.
"I don't think anyone expected Amazon to buy Whole Foods, and the contract was obviously written with that expectation," Mehta said.
Whole Foods was Instacart's first national delivery partnership. Instacart continues to deliver for Whole Foods along with Amazon's own delivery services, but experts say it likely won't be long before it's muscled out.
I decided to put Amazon Prime Now and Instacart to the test to see how they compare. Find out what happened below: