Google Express debuts fresh groceries in SF, LA

SAN FRANCISCO — Google is launching a new service to deliver fresh groceries in two U.S. cities, intensifying competition with online retail giant Amazon.com and tech start-ups such as Instacart.

The new service from Google Express will offer same-day delivery of fruit, vegetables, meat, seafood, dairy and frozen foods. It's launching in select San Francisco and Los Angeles neighborhoods, the Internet giant said. If the pilot goes well, Google Express will expand the service to other areas.

Google Express, which already delivers non-perishable items, wants to hit every item on grocery lists. In San Francisco, perishable goods will come from Costco, Smart & Final and Whole Foods. In Los Angeles, the merchants are Costco, Smart & Final and Vicente Foods.

Deliveries for perishables start at $2.99 for members and $4.99 for non-members. They arrive within a two-hour window, according to Prabhu Balasubramanian, group product manager for Google Express. Google Express is raising the minimum order including fresh groceries to $35 from $15.

Online grocery delivery is getting its second wind after the dot-com flame-out of Webvan, which filed for bankruptcy in 2001.

The grocery industry has been slow to move online after Webvan and because of the high costs and low profit margins, not to mention the logistical challenges of transporting produce and dairy that spoil quickly. But a growing number of new entrants are leaping into the online grocery business, including Amazon.com, which runs AmazonFresh, and Instacart.

Google says it has tested its delivery system for months, narrowing delivery windows and labeling grocery items as "refrigerated" or "frozen" to remind people to put them away quickly. Google Express is currently offered in California, parts of the Midwest, Boston, Chicago, Manhattan and Washington, D.C.

Follow Paste BN senior technology writer Jessica Guynn @jguynn