Online Grocery Shopping Makes a Comeback in Cities

Online supermarkets became one of the symbols of the dotcom boom, hailed as the shopping method of the future, then fading into oblivion when the bubble burst. Now, second-generation online grocers are thriving in urban areas where good supermarkets are hard to find, and grocery shopping is awkward under the best conditions.

Online grocers SimonDelivers.com, Peapod and FreshDirect are among the winners in this space. FreshDirect in particular is making its mark in New York City. The service, which delivers fresh groceries to one's door, appeals to upscale, Net-savvy consumers pressed for time, as well as anyone else who finds it difficult to get out to a supermarket. Landlords have begun using the service as an incentive for prospective tenants.

According to a Zagat survey, 52% of New Yorkers say they had ordered groceries through an online service. FreshDirect, for its part, doubled its sales in 2004, to $100 million. In response, established grocery stores are adding their own online delivery services.

Sources: Techdirt, The New York Times