People who want their groceries delivered to their doorstep may soon have one more way to get them there.
DoorDash Is Testing Delivery From Whole Foods and Trader Joe’s
Is it taking on Instacart?
Vjeran Pavic for Re/code
DoorDash has started delivering groceries from Whole Foods and Trader Joe’s in the LA area. Users of the on-demand restaurant delivery service received an email saying they can now order their “favorites” from these two grocery stores. DoorDash is specifically delivering prepared foods, like the sandwiches and wraps, as opposed to loose vegetables and fruits.
When asked by email, CEO Tony Xu told Re/code the delivery was a “quick test” and there was “no partnership” between the grocery stores and DoorDash. A DoorDash spokesperson said the test is happening in two other cities, although they wouldn’t confirm which ones. They aim to get a better understanding of customer behavior when it comes to on-demand groceries.
In the past, Xu has said he wants DoorDash to deliver other things besides food from restaurants. If groceries are next, the company will be taking on the long-standing monolith in that space — Instacart — not to mention Amazon Fresh and FreshDirect. If DoorDash manages to convince Trader Joe’s to partner with it, that will give it an edge over Instacart, whose negotiations with the popular grocery store have faltered.
DoorDash has managed to grow in the particularly noisy and crowded restaurant delivery space, taking on slightly older companies like Caviar and Postmates. Investors who have backed the company praise its technology, which relies heavily on machine-learning algorithms.
But challenging Instacart in groceries will be tough. Instacart has raised almost $275 million in funding, according to data from startup analytics company Mattermark, almost five times DoorDash’s cash reserves.
This article originally appeared on Recode.net.
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