April 26, 2016
Disruption is one of those words that Silicon Valley loves. The idea that the business you’re creating will ‘disrupt’ the status quo and bring something different to the market that will leave consumers clambering for more. Uber, love them or hate them, is the perfect example of this as a company that disrupted the taxi market.
The food industry has been getting its fair share of focus from disrupters looking to change how we eat – and I don’t just mean the food itself. In part driven by technologically friendly consumers and in part driven by the technology itself, numerous companies have popped up – some of which are backed by investors to the tune of millions of dollars – looking to grab marketshare by being the change they believe consumers want and need.
The question though is how quickly food consumers are wiling to change and adapt. Instacart is trying to make food delivery convenient for consumers by offering to shop and deliver grocery items to you but they are struggling to get into the black and recently announced that they are cutting salaries for some of their workers. At the same time though, as they look for other opportunities to increase revenue, they are tapping into their vendor partners for promotional opportunities and partnerships that helps highlight said vendors and brings in dollars to Instacart. It’s a logical next step but how consumers will react remains to be seen.
In the last week there has also been announcements and rumors about two personal chef companies that provided on-demand, in-home meal cooking for consumers. Again, these are companies with millions invested in them and a strong technology platform but the demand just hasn’t seemed to be there.
On the restaurant front, some restauranteurs have experimented with selling tickets to their restaurants instead of taking reservations. The ticketing, which may be either the full cost of the meal or a deposit of $20-$40 per person, helps the restaurant cut down on no-shows and helps them understand exactly how much food to have on hand for any given night. While this makes great business sense, consumers – as highlighted in this Washington Post article – have been less than thrilled thus far.
This isn’t to say the industry isn’t changing. I’d argue that it’s changing at a faster pace than ever before and much of that is actually being driven by the consumer (GMO-labeling, gluten-free products, etc.) And it will continue to change in order to stay relevant to today – and tomorrow’s – consumers. But exactly which disrupters rise to the top will in large part depend on how quickly consumers are willing to evolve.