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DoorDash CEO: Grocery delivery business has a long way to go

As Instacart works on its IPO, DoorDash’s lead exec says the overall consumer experience within delivery is worse than going to the store

Bill Wilson, Senior editor at Supermarket News

September 7, 2023

1 Min Read
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DoorDash CEO Tony Xu does not have a friendly take on grocery delivery as Instacart works to get its IPO, even though his own company is a major player in the segment.

Xu was at Goldman Sachs’ Communacopia Technology Conference in San Francisco this week and said he believes consumers think grocery delivery is worse than the experience of going to the store and buying products, according to reporting by PYMNTS

Xu said the grocery delivery business has a “long way to go” and noted out-of-stocks and insufficient replacements as problems.

Instacart, however, appears to be thriving. In filing with the Securities and Exchange Commission, Instacart noted its revenue last year was $2.6 billion, which is a 39% increase year-over-year, and through the first half of 2023 the San Francisco-based company has pulled in $1.5 billion, a 31% bump compared to the first half ofin 2022.

During DoorDash’s second quarter earnings call, Xu boasted about how his company has created a multi-billion-dollar grocery business from essentially nothing, and it was “ready for primetime exposure,” according to PYMNTS. DoorDash recorded a record 532 million orders during Q2.

Xu claimed DoorDash, which is also based in San Francisco, was growing faster than any other platform and was “gaining share dramatically across all categories, specifically grocery.”

Related:DoorDash to pay out $1.6M to workers in Seattle

PYMNTS also noted Instacart has eliminated consumers’ need to consider proximity in their decision about where to shop for groceries, and as the company continues to grow it may come to be an even more essential part of how consumers get their day-to-day needs met.  

 

About the Author

Bill Wilson

Senior editor at Supermarket News

Bill Wilson is the senior editor at Supermarket News, covering all things grocery and retail. He has been a journalist in the B2B industry for 25 years. He has received two Robert F. Boger awards for his work as a journalist in the infrastructure industry and has over 25 editorial awards total in his career. He graduated cum laude from Southern Illinois University at Carbondale with a major in broadcast communications.

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