It’s safe to say that we are in the golden age of retail. Between popular services like Postmates, Drizly and Uber’s new last-mile delivery service, it’s pretty easy to get everything you could possibly need delivered right to your door at the click of a button.
The latest company in the space to make headlines is JOKR, a new startup with a fresh take on on-demand delivery. The company launched out of Berlin, Germany, earlier this year and expanded to Mexico City and Lima soon after. Now, it is making its first foray into the United States, beginning with New York City.
This makes JOKR the first European Union-based delivery platform to launch in the U.S. The company was founded by a team of former Walmart, Uber and Foodpanda executives, and has been backed by several major VC firms, including HV Capital, Tiger Global and SoftBank.
In a nutshell, JOKR aims to provide users with whatever groceries and non-prescription medications they need in 15 minutes or less with no added fees.
It manages to do this with various strategically placed “micro-fulfillment centers” — ground-level storefronts stocked with products that the people in a given neighborhood are going to buy. In practice, a user places their order on the JOKR app, that order is sent to the micro-fulfillment center closest to them, and a JOKR employee there picks out the items on the order. Another JOKR employee then delivers those items to the user’s door on an electric bike.
Unlike many other similar startups, all JOKR employees — even the pickers at the fulfillment centers and riders who make the deliveries — are full-time workers, and receive all the perks and benefits that go along with that.
“We consider that to be an important part of our business because the riders and the pickers are the ones who make things work,” U.S. co-founder Zach Dennett told Built In. “By having our riders as full employees, we’re able to make sure that they are taken care of with things like healthcare and the right uniform for the right weather and high-quality bikes. We’re also able to have them be part of the team.”
Driven by Data
Another interesting differentiator with JOKR is its focus on data. The company uses hyper-localized, neighborhood-specific data to figure out not only what customers need, but at what time of day they need it and during which week or month or season. It also works to figure out what kind of items users are willing to compromise on in terms of brand and price, building out a dynamic inventory and catalog management system that constantly rotates inventory and offers forecasted suggestions for customers.
Dennett describes JOKR’s data-driven model as a “predefined experiment.” For example, one week the company could decide to sell Barilla pasta in Tribeca and De Cecco pasta in Union Square, and switch them the next week. The data team can then go back and adjust for things like weather, traffic and general activity in those two regions to decide what brand of pasta performed better so they can stock their shelves accordingly.
“As the customers give us that answer, we’re able to streamline the shopping experience,” Dennett explained, adding that this also often leads to cheaper prices.
JOKR even took this approach when deciding where to expand to in the U.S. Dennett explained that the data team made a map of the whole world and divided it into 100-meter hexagons, then looked deeply at each area’s population density, traffic and grocery spending to score “how attractive” the area is — “the brighter the area, the more attractive.”
In the end, Dennett says the New York area shined brightly, so JOKR decided to start there. There were several other U.S. cities that stood out from the crowd too, and the company plans to expand to at least five of them by the end of this year, as well as additional European and South American locations.
In the meantime, JOKR says it will offer around 1,500 items with delivery zones covering most of Manhattan below 35th Street, as well as neighborhoods in Brooklyn and Queens. Dennett also says the company is growing its team in NYC “very fast” and on all levels, from pickers and riders to those in the marketing and supply chain.
The Future of Shopping
Long term, JOKR aims to capitalize on consumers’ rapid shift to e-commerce brought on by the pandemic. Dennett says the convenience of having groceries and household items brought straight to your door is no longer a luxury, but a requirement for a lot of folks. And it’s something not many people are going to give up easily, even when the pandemic comes to an end.
“When you look back at the whole history of retail, from the introduction of the very first catalog to the two-day shipping today, there’s been a push toward more and more convenience, basically forever,” Dennett said. “I think that the pandemic accelerated fairly dramatically a lot of the trends that we were seeing before the pandemic, as people shifted to being more comfortable shopping online.”
And now that consumers have largely gotten over the discomfort of letting someone else do the grocery shopping, Dennett says their standards will be even higher going forward. They will want specific products and brands and a lower cost, without added delivery fees or long wait times. This is where JOKR is really going to thrive.
“It’s fun being in this place where we are in retail, because I feel as if I have glimpsed the future of how shopping is going to happen,” Dennett said.