Peapod turned 25 on Sept. 24. It’s the oldest web retailer in the 2014 Internet Retailer Top 500 Guide and no doubt among the oldest continuously operating e-retailers anywhere. Of course, back on Sept. 24, 1989, the Internet as it’s known today did not even exist. (The World Wide Web, providing a standard way to exchange information, came online in late 1990). Back in the ‘80s, Peapod mailed customers a disk (PC or Mac, depending on their request) and a VHS videotape with a handsome young man chipperly explaining how to install Peapod on a computer and how to shop on a computer.
“A lot has happened in technology since then,” says the handsome young man from the video 25 years later, Thomas Parkinson, co-founder, senior vice president and chief technology officer at Peapod. “It was so difficult back then. Every time you made a change, you had to write code for PC and for Mac and put out a new disk. We had two development teams, one for PC and one for Mac.”
Peapod grew up and became one of the most successful online retailers. It is No. 61 in the 2014 Internet Retailer Top 500 Guide, with estimated 2013 web sales of $585 million. Peapod also is one of the most mobile retailers around. It is No. 45 in the recently published 2015 Internet Retailer Mobile 500, with estimated 2014 sales on smartphones and tablets of $300 million. 40% of Peapod’s total web sales will be mobile in 2014, and 70% of its mobile sales will come through its highly successful mobile apps, according to the 2015 Mobile 500.
But Peapod’s mobile apps weren’t always so successful. With good humor, Parkinson fondly remembers creating what he says was the world’s first mobile shopping app: Peapod for Palm Pilot. It was an abysmal failure.
“One of my worst moments in mobile commerce was all the way back in 2001,” says Parkinson, who heads mobile commerce efforts at Peapod. “We came out with the Palm Pilot Peapod mobile app. You put your order together, put the Palm in its cradle to sync it with your computer and thus through to Peapod’s servers, and put those items in your cart. We put a lot of effort into that thing, and no one used it. A complete dud. The whole batch order transfer thing, no. But we had the first mobile shopping app!”
Parkinson views today’s mobile commerce world with great irony. Why? Because it’s 1989 all over again. Instead of developing for PCs and Macs, now it’s Apple iOS and Google Android. However, he and his team came up with a nifty trick very early on in the mobile commerce revolution following the introduction of the iPhone in 2007. This trick has helped him avoid the headaches from the early days when building for two major platforms.
“In 2008 I wrestled with how should we build the Peapod mobile app to run on both platforms while also running a desktop web site,” Parkinson says. “For native apps, I would have had to hire two teams to build and learn, and every time we add a feature, do it on the desktop and on two mobile platforms. We were faced with the same thing in the early days, and I knew the dangers of that. We wanted to move quickly and make changes to our site and mobile, and I didn’t want customers to have to download things to get new features.”
So Peapod began exploring HTML5, the latest version of the programming language that the Wide Web Foundation deems one of the three building blocks of the web. Unlike HTML4, HTML5 allows developers to build web sites that look and function a lot like mobile apps.
“Should we go with an HTML5 site in a browser for mobile shoppers or build native apps?” Parkinson remembers asking. “With HTML5, we would have one code base, could use the same developers, and have serious cost savings and flexibility. But with native apps you have sliding windows and all those cool tools you get in the iPhone and Android toolkits. One of my developers pushed the envelope with HTML5 and came back with something that stunned me: a container app built around the HTML5 mobile site. It looked like an app, but all came from the same server as the desktop site.”
Marketing wanted something in the app stores. That department wanted customers to be able to find Peapod there and download an app. Parkinson wanted the business to have flexibility, keep costs down and to support only one development team. The container app was the perfect compromise, Parkinson says.
“We had invented a Trojan Horse,” he says. “This app quickly became 50% of our mobile business. Big success, but a huge risk to go with HTML5 at that time.”
Peapod, acquired in 2001 by the Dutch company Royal Ahold NV, currently is in the middle of rebuilding its web site from scratch, and updating its mobile apps.
But first the team has to finish the rest of the big birthday cake.
Follow Bill Siwicki, editor of the 2015 Internet Retailer Mobile 500 and managing editor, mobile commerce, at Internet Retailer, at @IRmcommerce.
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