Before there was Instacart, AmazonFresh, and FreshDirect, there was Peapod. Founded in 1989 as a service where customers could phone in their orders, the online grocer has grown to command a significant portion of the growing food delivery market—which is expected to reach $100 billion in sales by 2025, according to a recent report from Nielsen and FMI. Part of Peapod's promise is the financial backing of parent company Ahold Delhaize, which acquired it for $35 million in 2001. Along with using its own warehouses, Peapod can also tap into the supply chains of Ahold Delhaize's brick-and-mortar chains, like Stop & Shop and Food Lion.
"There are a lot of shiny new players right now that are doing what we did in the first two years, but it's not sustainable and inefficient," said Carrie Bienkowski, who joined Peapod as chief marketing officer three years ago from eBay. "Because we're part of a bigger brick-and-mortar operation, it's enabled us to expand quickly."
Of course, Peapod's dilemma is that the Skokie, Ill.-based company lacks the brand awareness of its trendier new competition. Beginning this week, the company plans to change that with a new marketing campaign designed to expand its presence in the New York City regional market, which currently accounts for about a quarter of sales. Later this year, Peapod will debut a more universal campaign to boost its brand.
Delivering food and meeting temperature and expiration requirements can be a difficult and expensive business, and one that Peapod has spent decades mastering, unlike Amazon and other new entrants to the category, who are still learning the ropes.
"Peapod may be old school, but they do execution 100% well. They trained their people to be food experts," said Phil Lempert, founder of Supermarket Guru, which analyzes the grocery space. "Their problem is branding."
The Big Apple push, tagged "The Grocery Store at Your Front
"We wanted to talk to New Yorkers like New Yorkers—be relatable and touch on the frustrations of everyday lives," said Karen Cathel, exec creative director at Doner, noting that the resulting campaign touches on the hardships of urban life, like how much groceries weigh.
Though Beinkowski declined to say how much Peapod is spending, she noted that it's the most expensive effort the brand has ever had for a single market push. Last year, Peapod spent about $1.5 million on measured media in the U.S., according to Kantar Media.