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    Safeway Online Operation Launches in Phoenix

    PLEASANTON, Calif. -- Safeway, based here, rolled out its online shopping and home-delivery service, Safeway.com, in greater Phoenix yesterday. Six Safeway stores in the Phoenix area will process and deliver online orders, with 30 new employees devoted to the Internet arm of Safeway's retail operations in the market.

    PLEASANTON, Calif. -- Safeway, based here, rolled out its online shopping and home-delivery service, Safeway.com, in greater Phoenix yesterday. Six Safeway stores in the Phoenix area will process and deliver online orders, with 30 new employees devoted to the Internet arm of Safeway's retail operations in the market.

    Chandler, Ariz.-based Bashas' and Boise, Idaho-based Albertsons already provide online grocery services in Phoenix. While Bashas' Supermarkets has been providing phone, fax, and online ordering services for the past 10 years, Albertsons introduced its program to the area late last year.

    According to Safeway, almost all items available in its stores are also available online at in-store prices, including Safeway Club Card specials. Among the features of Safeway.com are exclusive delivery of prescription refills and same-day delivery for orders placed before 9 a.m. Additionally, its Express List tool allow customers to complete a virtual shopping trip in less than 15 minutes.

    "Safeway.com customers are busy people who want quality groceries delivered on time and at their convenience," said Safeway.com president Mitch Rhodes in a statement. "The introduction of Safeway.com to Phoenix allows us to deliver the high level of service we're known for throughout the West Coast to the busy residents of Phoenix."

    "The perfect storm has come together for Phoenix," said Safeway.com s.v.p. marketing Lesa Musatto, in an interview with Progressive Grocer. Both the chain's aggressive expansion in the area and "a lot of customer requests" led to the decision to extend e-commerce to the market, she explained.

    Musatto said Safeway.com's points of differentiation in Phoenix include its coverage area, which encompasses up to 55 ZIP codes; a $5 discount it offers seniors every Tuesday; and its practice of not charging extra for same-day deliveries.

    Safeway.com's Web site architecture mirrors the aisle structure in stores. Products are organized into familiar sections, including frozen foods, dairy products, fresh produce, grocery, and nonfood items. Shoppers can choose the brands they prefer and select fruit or vegetables to suit their own "ripeness" preferences. Orders are delivered daily six days a week between 10 a.m. and 9 p.m., within a two-hour time slot selected by the customer.

    Safeway charges $9.95 for delivery of orders costing under $150, and $4.95 for orders costing $150 or more. First-time customers who type in the code "FREE" at checkout will not have to pay delivery fees on their inaugural order.

    Once complete, orders are packaged and loaded into a temperature-controlled truck. Frozen goods are kept in a specially designed freezer compartment, while produce and other perishables are put in a separate refrigerated section, and dry products are stored at ambient temperatures.

    When asked about future markets for Safeway.com, Musatto said that there would be more to come, but declined to give particulars.

    Safeway.com, which is 50 percent owned by Safeway and 35 percent owned by Tesco plc, also operates in Portland, Ore.; Vancouver, Wash.; Sacramento, Calif.; the greater San Francisco Bay area, and San Jose, Calif.

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