Instacart’s CEO is focusing on grocery partnerships amid investor skepticism.
Fidji Simo discussed these efforts in an interview with Bloomberg’s The Circuit With Emily Chang, set to air Thursday (Nov. 21) evening.
Since becoming CEO, the report notes, Simo has made Instacart’s higher-margin enterprise business a higher priority, focusing on things like last-mile delivery, building white-label websites and selling advertising slots on the company app.
Instacart has also expanded into brick-and-mortar offerings such as electronic shelf tags and smart shopping carts. Simo thinks that serving as a technology partner for grocers can help the company compete against Walmart and Amazon as those giants invest in digital grocery tech.
“The Amazons and Walmarts of the world might get a fair share of people, but if your favorite retailer of choice is a Publix, a Kroger, an Albertsons, we really are the best place for that,” Simo told The Circuit.
Inside the company, she added, these efforts have helped her establish credibility, an edge that she didn’t have as a non-founder taking the job of chief executive.
As Bloomberg notes, the grocery delivery company is dealing with a loss in value as Americans return to in-store shopping. Instacart’s market value — which peaked at $39 billion before the company’s initial public offering (IPO) — has fallen to just over $10 billion.
More than a year after the firm went public, the report said, analysts disagree on their recommendations for Instacart’s stock. Bloomberg says its data shows 16 hold ratings and 14 buys.
And last week, the company’s earnings report showed a mixed outlook. While delivery sales had been resilient, the firm also released weaker-than-anticipated guidance for its fourth quarter. Instacart’s stock dropped by a record 11% following these results.
PYMNTS CEO Karen Webster spoke earlier this year with Instacart Chief Product Officer Daniel Danker about the company’s use of artificial intelligence (AI) tools to upgrade its digital grocery experience, with a focus on affordability.
“It always has to come back to the customer,” Danker told Webster. “It has to solve a problem. We can’t just have technology for the sake of technology.”
It’s a strategy built around convenience and personalization, with features such as the “Buy it again” function, which typically contains more than 200 items for the average user.
“We want to make it effortless, and it’s beginner AI,” he told Webster, adding that the first step is making food decisions effortless for the shopper. “Intermediate and advanced is going to get really exciting.”
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