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Starship Rockets Away From Save Mart

Well this is interesting! Starship “abruptly” ended its robot grocery delivery service with Save Mart, according to a story in the Modesto Bee yesterday. Starship had been doing robot grocery deliveries for Save Mart in Modesto since September of 2020.

From that Bee story:

The Save Mart Companies spokeswoman Victoria Castro said in an email that the tech company “made the decision to exit Northern California” earlier this month. Modesto customers hoping to order from Save Mart and have one of the cooler-size robots show up at their front doors are instead met with a message on the Starship app that reads, “Temporarily closed. We’re sorry we cannot deliver from this merchant right now.”

The “decision to exit Northern California,” is weird and oddly geographically specific in and of itself. But it’s even more weirder when you consider that just this past February Starship expanded its relationship with Save Mart to make deliveries from a Lucky store in Pleasanton, California, as the Bee also mentioned:

This February, Save Mart expanded the program to its second city, Pleasanton. Company officials said the program running out of the Lucky supermarket, which is owned by The Save Mart Companies, in the East Bay city had been popular until its termination this month.

Starship didn’t comment for the Bee story, and I reached out to the company to see if they’d give me any more information. A PR person pointed me to an announcement from June 9 — which I evidently missed (or was released very quietly), which gave the following vague (but totally understandable) reasoning:

Earlier this year Starship announced nearly $100 million in funding, and in light of the global macroeconomic and investment environment, we must now make changes to ensure we sustain our long term success as the leader in last mile autonomous delivery. Many of our locations have completed record numbers of deliveries this year and demand in those markets continues to be high, with plans to add to our fleets. Those markets have a broad mix of merchants, and a large base of potential customers. However, due to the aforementioned changes in the economy and investments, Starship must now make difficult changes to focus on cost savings and improving profitability.
These changes mean that we are closing a small number of service locations in the US and Germany over the next two months. The locations that we must close do not have the right mix of merchants and customer base to meet our near-term profitability goals. In addition to the staff impacted by these decisions, we are also reducing the team at the corporate level.

Ugh. Layoffs suck and they are everywhere.

While the world teetering on the brink of recession is reason enough to scale back corporate ambitions, I’m going to take this moment to fire up the speculation machine and dive a little deeper into what might be going on with Starship.

Possibility 1: Starship will focus entirely on colleges (in the U.S.). Among all the robot delivery companies, Starship was the first and has been the most aggressive to partner with college campuses here in the U.S.. At last count, Starship robots were running around at least 25 colleges and universities where, anecdotally speaking, the service has been popular.

But the company is facing pressure now from Kiwibot, which counts foodservice giant Sodexo as a partner and investor. At the start of this year, Kiwibot/Sodexo planned on putting 1,200 robots on 55 U.S. campuses by the end of 2022. But not only that, earlier this month food delivery service Grubhub, which has a network of 250 partner colleges, announced Cartken as a robot delivery partner and could be poised to ramp up those efforts.

Perhaps Starship wants to solidify its lead in the college market and not do these smaller, one-off regional grocery delivery deals.

Possibility 2: Starship will focus on Europe. This is less likely, given its powerhouse presence on U.S. college campuses, but in April Starship announced a deal to provide grocery delivery for Alepa in Finland. As we wrote at the time, Starship was operating in U.K., ~~Germany~~, Denmark, and Estonia. Not only that, but Starship received a €50 million capital infusion from the European Investment Bank in January, so it’s got an incentive to put that money back into that continent. Starship also has an innovation center in Estonia where it is scaling up its fleet of robots.

Given all this, perhaps Starship will focus its efforts closer to its European roots — but I doubt it.

Possibility 3: Maybe robot grocery delivery sucks(?) Maybe rover robots just suck at delivering groceries — at least in suburbs. I’m talking about the squat, cooler-sized, slow moving sidewalk robots. They don’t hold a ton, aren’t temperature controlled and at 4 mph, don’t exactly zip from the store to your door.

Starship wouldn’t be the first to get out of the robot grocery delivery game. Tortoise, which makes a teleoperated robot capable of hauling a week’s worth of groceries, bailed on consumer grocery delivery to pivot to mobile commerce (where it got immediate traction).

Plus, doing autonomous consumer grocery delivery on public sidewalks means that Starship has to deal with local governments (as opposed to doing just on-campus delivery). Given the work of getting supermarkets to try it, the limited capacity of the robot and the need to work with a patchwork of regulators across the country, it could be that Starship just figured it’s much easier to focus its efforts elsewhere, and blasted off.

Our friends at the very awesome Curbivore recently held a free webinar that OttOmate readers will definitely dig. It’s available on demand and is well worth your time:

"Coding the Curb: Using Data to Rethink the Street & Sidewalk," is a lively discussion on what comes next for the worlds of food delivery, outdoor dining, and more. You'll hear from officials from the City of Oakland, the Open Mobility Foundation, and many more - as they highlight success stories across the globe, and give you insights into what sort of regulatory and technological changes are ahead for this quick-moving field.

Register and Watch

Disney Eyes Non-Animatronic Robots

It’s a small, increasingly robot-filled world after all. According to a report in TechStory, Disney has applied for a patent for a mobile robot storage locker. The idea being that people could securely store stuff inside the robot and when they need said stuff, the robot pops over to their exact location with it.

TechStory writes:

Moreover, it would include the provision of an insulated compartment for the guests to store beverages such as cold drinks and milks for infants, along with other products which require to be kept cold.

Anyone who has ever been to The Happiest Place on Earth knows that lugging around a backpack full of stuff (especially if you have kids) that you have to keep taking off and on as you go on rides is not fun. So the idea of hailing a storage robot (especially one that looks like the Star Wars toaster) bringing you what you need when you need it is definitely appealing.

But this personal robot could just be a first step. I imagine(er) the number crunchers at Disney see that people standing in lines for hours can’t spend additional money. Allowing people stuck in the hot sun outside Space Mountain to order a cold drink from the line and have it autonomously delivered could boost the park’s already impressive bottom line.

The bigger question would be the robot/person ratio. There are a lot of people at Disney, which means a lot of collision avoidance for any autonomous (or even teleoperated) robot. Too many people + too many robots = nothing can possi-blye go wrong.

But once they have that all figured out, I’m sure it’s not a big leap to break animatronic George Washington out of the Hall of Presidents and have him hand deliver you a churro while you wait to get on the teacups 🤢.

That’s it for this week. Thanks for reading!

Stay cool. Have a great summer. Class of ‘90 rulez.

-Chris

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Starship Bails on Save Mart (and Northern…