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July 10, 2025
Alka Jain, Outlook Business
10 July 2025
Just when Blinkit, Instamart and Zepto were slowing down in their quick commerce game, Amazon’s entry may spur them towards a more aggressive race. The ecommerce giant has begun offering deliveries in as little as ten minutes in Delhi after Bengaluru, under the name ‘Amazon Now’.
“We are excited with the initial customer response and positive feedback, especially from Prime members. Based on this, we are now expanding the service over the next few months addressing immediate customer needs while maintaining Amazon’s standards for safety, quality and reliability,” the company said in an official statement.
Till now, the company was moving at its own pace with the idea that Indian consumers would wait a day or two for their deliveries. But the game has changed now—convenience is king here. Online shoppers want everything from milk to mobile chargers within a few minutes at their doorsteps.
And the big three of the quick commerce market—Blinkit, Instamart, Zepto—have cracked the consumer code perfectly. This trend has nudged Amazon and Flipkart to enter the 10-minute delivery segment. It started as an experiment in the larger ecommerce sector but has now become a necessity for online retailers.
Kathryn McLay, chief executive of Walmart International—an American multinational retail corporation—revealed that quick commerce now accounts for 20% of India’s ecommerce market and is growing at a rate of 50% annually. According to a Morgan Stanley report, the market is expected to reach $57bn by 2030.
Hence, Amazon could not afford to stay on the sidelines. The company has already pumped $11bn into Indian market since 2013 and recently announced another $233mn to upgrade its infrastructure and speed up deliveries. In addition, it has also opened five fulfilment centres across the country.
Despite continued investment, there are doubts if Amazon can disrupt the quick commerce game. Industry experts state that the ecommerce major’s late entry could upend the fragile unit economics of the space. It can even reignite discount wars and increase burn rate (a company spending its cash reserve while going through loss) for the incumbents, once the ecommerce giants begin to exert pressure and begin to capture market share.
Open Market, Thin Margins
Given the growth momentum and market size, quick commerce start-up Kiko.live cofounder Alok Chawla believes that there is definitely headroom to accommodate another player in the quick commerce market. However, margins may remain negative for a couple of years due to high business and delivery costs.
As per data, the average order value of ₹350–₹400 yields a gross margin of approximately 20% but high fulfilment and delivery costs (₹50–₹60 per order) significantly reduce overall profitability, often cancelling out most of the gains.
“Indian customers will not be willing to pay high shipping charges for convenience. But the market will continue to grow due to cart subsidies and shipping discounts. On top of this, profitability also remains quite some time away,” he says.
Even a survey by Grant Thornton Bharat, a professional services firm, shows that 81% of Indian quick commerce users cite discounts and offers as one of the main reasons they shop on platforms like Blinkit and Instamart.
But the fact is Amazon has extremely deep pockets, which means, the trio will once again have to get into aggressive discounting to protect their turf, said Chawla, indicating the possibility of higher cash burn quarters ahead.
In February, reports revealed that Indian quick commerce companies, including new entrants, were burning cash to the tune of ₹1,300–₹1,500 crore on a monthly basis. But a few months later, Aadit Palicha, chief executive of Zepto, a fast-growing 10-minute delivery platform, claimed that the company had slashed its operating cash burn by 50% in the previous quarter.
Still, the path to profitability remains shaky. Though Amazon can get an advantage of its existing huge customer base that is habitual of making online purchases including those in similar categories.
The real challenge lies beneath the surface because ecommerce and quick commerce operate on fundamentally different engines.
E-Comm vs Q-Comm: A Different Game
It may seem like a simple extension of what Amazon already does: deliver products. But in practice, the logistics, timelines and cost structures behind traditional ecommerce and quick commerce are different, said Somdutta Singh, founder and chief executive of Assiduus Global, a cross-border ecommerce accelerator that helps brands scale on global marketplaces through end-to-end solutions.
She explains the difference using a hypothetical situation: let’s say you order a phone case in Mumbai, which is picked from a nearby fulfilment centre. It will be added to a pre-routed delivery run with 30-50 other stops. This batching on the basis of route optimisation, keeps last-mile costs low, somewhere around ₹40–₹80.
But if you order the same item in a smaller town like Alleppey, it may first travel mid-mile from a hub in Cochin, then be handed off to a local partner like India Post. This increases the delivery time but keeps costs manageable through scale and planned routing.
This setup suits well in ecommerce business, which is built for reach and variety, not for speed. However, quick commerce runs on a completely different playbook because speed becomes priority here.
For instance, you order a pack of chips and a cold drink via Zepto in Andheri. These items are already stocked in a dark store within one to two kilometers of your home. The moment you place the order; someone picks it off the shelf. A rider is dispatched almost immediately and heads directly to your address.
There is no mid-mile movement, no routing logic and no batching. Each trip is a solo run. Delivery often happens within 10 to 15 minutes. This kind of speed relies on a dense network of local stores and a steady flow of short-range riders. But it also means higher costs.
“With no bundling of orders and lower average cart sizes, usually ₹250 to ₹300, the delivery cost per order can shoot up to ₹60 to ₹120. That is a heavy operational burden. Unlike traditional ecommerce, where cost efficiency scales with distance and order volume, quick commerce is constrained by geography and time pressure,” she explains.
So, it becomes more than just a category expansion for e-commerce platforms like Amazon and Flipkart. It marks a pivot in their “logistics thinking” and signals a broader shift in entry strategies. What once worked must now be retooled for hyperlocal and real-time operations.
Speed over Scale Not Easy
There are multiple challenges ahead for Amazon to make its presence felt and stay competitive in the quick commerce space. Firstly, it must build an operations and logistics layer that enables sub-15-minute deliveries, along with a technology stack to support it, according to Mit Desai, practice member at Praxis Global Alliance, a management consulting firm.
Second, it needs to build a dark store network to succeed in the space which is crucial to meet the 10-15 minutes delivery promise. Experts believe that a hybrid model will be the most successful in India—a mix of micro warehouses, partner stores and dark stores.
Desai states that Amazon’s existing capabilities can give it a base to build on, but it would also have to account for complexities and differences that come with the quick commerce business.
“For Amazon, the challenge will be operations. Can they build 700+ dark stores? Can they go hyperlocal? Can they navigate the chaos of Gurugram rain, Bengaluru traffic or the lanes of Dadar?” wonders Madhav Kasturia, founder and chief executive of Zippee, a quick commerce fulfilment start-up focused on hyperlocal deliveries and dark store management.
Another challenge can be repeat, loyal customers. As of now, customers check prices across platforms, and order where prices are the lowest. So, Amazon will have to spend heavily on discounts to gain market share. Chawla says retention will remain a problem because Zepto’s growth has also slowed down after a reduction in discounting burn.
However, Singh highlights that Amazon may not roll out everything in one shot. “We will likely see small-scale pilots, co-branded dark stores, local partnerships, new rider networks, tested in top cities before any nationwide push. They will also reveal whether it is viable to retrofit scale-driven e-commerce infrastructure into something that runs well in a hyperlocal loop,” she added.
Profitability Remains a Concern
While the quick commerce space is becoming increasingly dynamic with new entrants, the core question remains: is it a sustainable business model? The path to profitability is still fraught with operational complexity, margin constraints and uncertainty in consumer behaviour.
“Margins in quick commerce were never pretty to begin with,” says Kasturia. Yet he remains optimistic about the market because India’s grocery market is still largely untapped online.
As per data, India’s grocery and essentials market is over $600bn, of which online commerce is just three to four percent. Even quick commerce is sitting at ₹7,000–₹9,000 crore gross merchandise value today. So, the market isn’t crowded. It’s just early.
“We are barely scratching the surface,” he says, arguing that whoever wins customer behaviour, will lead the game. For example, in tier 1 cities, users no longer compare prices—they compare time.
For Amazon, this is both an opportunity and a constraint. Experts believe that the ecommerce giant can stand out by focusing on trust, hygiene and reliability—areas where existing players sometimes falter.
Kasturia says that the platform should not even chase everything, rather focus on profitable categories like fruits, dairy and personal care. “Build strong private labels. Nail density before geography and don’t discount blindly,” he adds.
The key is to build for reorders, not virality. That’s when customer acquisition cost (CAC) drops, margins compound and a player stops bleeding money per order. And to reduce the cost of dark stores, Chawla suggests an alternative route.
“Riding to neighbourhood stores for long-tail stock keeping unit can cut real estate and wastage costs,” he says, adding that it can decentralise inventory without owning all of it.
To follow this playbook, Devangshu Dutta, founder of Third Eyesight, a management consulting and services firm, says that every player needs to invest hundreds of crores before the model begins to show surplus cash. It will demand multiple, interlocked shifts—in pricing strategy, tech backbone, category mix, and even brand positioning.
Amazon’s entry doesn’t merely add another contender in the 10-minute delivery race—it rewrites the playbook for every player. The real question now is: can the frontrunners hold their turf, or will Amazon’s scale and deep pockets tip the balance of power?
admin
March 20, 2025
Sagar Malviya, Economic Times
Mumbai, 20 March 2025
Established beauty product makers such as Forest Essentials, Colorbar, Kama Ayurveda, Body Shop, VLCC Personal Care and Lotus Herbals saw a slowdown in sales growth in FY24, according to the latest Registrar of Companies filings. Consumers favoured new-age rivals such as Minimalist and Pilgrim, specialised derma brands, as well as global labels Shiseido, Innisfree and Eucerin.
Sales growth of established brands mostly in the natural skincare segment, more than halved to single digits during the previous financial year amid a broader economic slump.
In contrast, companies such as L’Oreal, Nykaa and Sephora continued to grow at 12-34% on a significantly bigger base, even as they lost pace.
Direct-to-consumer brand Pilgrim more than doubled its sales, Minimalist’s revenue increased 80% and Foxtale’s sales surged 500% on a lower base.
“With most consumers tightening their budget on discretionary spends in FY24, they seem to have opted for brands that give instant benefits compared to natural products, which take time to be effective,” said Devangshu Dutta, founder of retail consulting firm Third Eyesight.
Over the past few years, there has been a flurry of beauty product launches, which have depended on platforms such as Nykaa and Tira for sales.
In the past two years, Nykaa has launched more than 350 brands, or In the past two years, or nearly one new label every alternate day on average.
This includes international brands such as CeraVe, Uriage and Versed, as well as home-grown brands such as Foxtale and Hyphen.
Reliance Retail, which entered beauty retailing with Tira two years ago, now sells nearly 1,000 brands, including exclusive labels such as Akind, Augustinus Badee, Allies of Skin, Kundal and Patchology.
“10 years ago we were only competing against big guys,” Vincent Karney, global chief executive of Beiersdorf, maker of Eucerin, Nivea and La Prakrit, told ET last month. “Now we have those local brands, and we have to become a bit more agile.”
On Nykaa, Fenty Beauty by Rihanna is the highest-selling brand in lipcare while Eucerin has become its biggest premium dermo-cosmetic serum. South Korean beauty brands Axis-Y, Tirtir and Numbuzin grew over 60% in 2024, with sales of toners increasing 104%, serums 45%, moisturisers 52% and sunscreens 154% on the platform.
VLCC and Colorbar did not respond to ET queries, while Forest Essentials was not reachable.
In January, Mike Jatania, cofounder and executive chairman of The Body Shop and Aurea Group, told ET, “There would be continuation of new entrants. Inflation is still a global issue and we will see the pressure. Competitive environment will be a challenge… 70% of our stores are showing decent growth. We have closed some stores and opened a few also, that’s the nature of the business.”
Ingredients Matter
Warnery of Beiersdorf emphasised the need to stay focused on “big innovation, by being able to talk to GenZ, (a position) which might be filled in by those local brands coming with basic ingredients.”
The likes of Minimalist, Ordinary and Pilgrim disclose active ingredients at a granular level, specifying the exact percentage of acid used in the product to appeal to GenZ users (those born between 1997 and early 2010s), who are said to be far more conscious of what they use on their skin compared to millennials (those born during 1980s to mid-1990s) and Gen X (those born from about 1965 to 1980).
Shoppers Stop, which manages brands such as Estee Lauder, Shiseido, Bobbi Brown, Mac and Clinique in India, sees the overall beauty market driven by companies focusing on consumers across age groups, and not just younger ones. Both natural and dermatological products are expected to find takers.
“While most new age brands tap younger cohorts, their pocket size allows them to mostly buy affordable products and the more affluent consumers opt for established global brands that have proven themselves since decades,” said Biju Kassim, chief executive, beauty, at Shoppers Stop. “Beauty is still not a habit in India and with hundreds of brands being launched, the focus is to grow penetration. There is also a shift from care to cure, driven by derma-recommended products and brands disclosing active ingredients, but it is still a niche sub-segment.”
Dutta of Third Eyesight sees the current trend as temporary. “We expect growth of (established) companies to bounce back in the current fiscal, driven by a strong demand for beauty,” he said, pointing especially to online platforms. India’s beauty and personal care market is expected to reach $34 billion by 2028, up from $21 billion now, driven by an online surge and a growing preference for high quality, premium beauty products according to a report by Nykaa and consulting firm Redseer.
Nicolas Hieronimus, chief executive of cosmetics giant L’Oreal, last year said consumers in India are more demanding and are not just settling for very basic things like putting an ingredient in a product such as salicylic acid or collagen. “That’s where L’Oreal has the best cards to play, and that’s where we really thrive,” he had told ET.
Beiersdorf, Unilever, L’Oreal and Shiseido, among the world’s largest cosmetics companies, have all identified India as a key growth driver, citing the burgeoning population and growing affinity for beauty products.
(Published in Economic Times)
admin
March 7, 2025
Shailja Tiwari, Financial Express
March 7, 2025
This is what happens when you hit the gym after a long pause. On your first rebound day, the same weights seem heavier, the same set of squats tires you quicker. You might feel frustrated – nothing seems the way you left it.
The same scenario faces brands looking to make a comeback. Those “muscles” – read brand loyalty -have lost strength due to long absence. The brand’s “stamina”- customer loyalty – have declined with neglect. All of which essentially means you need a relook at the entire “regimen” – the product, price, place and promotion – that seemed to work the last time around.
Men’s fashion brand Reid & Taylor is facing the same dilemma.
Launched in India in 1998, the brand vanished from the market in 2018 after S Kumars – which held the rights to manufacture and market the Scottish brand in India went bankrupt. Reid & Taylor is making a gradual comeback now, under the aegis of its new owner Finquest Group, complete with a campaign featuring new brand ambassador Vicky Kaushal and tagline, “Man on a Mission”.
Finquest Group has invested over ₹750 crore in revitalising the brand. Reid & Taylor is available in more than 1,200 multi-brand and exclusive brand outlets across the country, as per a company announcement.
In January, Reid & Taylor also announced its partnership with the Unicommerce to knit together the brand’s website, warehouses, physical stores, and other online platforms in one integrated network. The tech integration followed the launch of Reid & Taylor’s brand website and its growing presence across various online marketplaces, a clear signal the company is gearing up to address the needs of today’s customer and give its competitors a run for their money.
Kapil Makhija, CEO and MD, Unicommerce, explains how this will enable Reid & Taylor to modernise its operations: “In addition to a consistent customer experience, this integration enables efficient inventory management through a centralised platform that allows ship-from-store service, where the brand can switch orders between warehouses and stores, offering a broader assortment for sale and faster order fulfilment. It also helps Reid and Taylor connect with the more online savvy audience.”
The Indian menswear market, encompassing formal, casual and traditional apparel, had crossed ₹2 trillion in 2023 and is expected to reach ₹4.3 trillion by 2027, as per a Statista report. Experts say that the menswear category has grown exponentially since Reid & Taylor’s first outing. It has a host of local and international brands such as Raymond, Mufti, Allen Solly, Louis Phillipe and Manyavar offering stiff competition.
In other words, Reid & Taylor has its task cut out.
Makeover strategy
The greatest challenge for the relaunched brand is to establish relevance and share-of-mind with a new set of consumers, observes Devangshu Dutta, CEO of Third Eyesight. “In its initial avatar in India, it rode on the brand’s past goodwill, but since its fall a few years ago, the market has changed significantly. Ready-to-wear apparel, growth of modern retail, online commerce and a set of consumers who have no past history or association with the brand are all significant factors at play, remarks Dutta.
At its best in the early-2000s, the brand was positioned mostly within the wedding segment, a category that is also rapidly changing. The styles that dominate wedding apparel are changing among younger cohorts, points out Ajimon Francis, MD India for Brand Finance. Formal three-piece suits and safari suits are no longer style statements.
Consumers are opting either for designer wear like a Tarun Tahiliani or for mid-segment offerings where brands like Raymond operate. “Formal suits are becoming an ‘uncle’ or ‘dadaji’ segment, and the wedding lines showcased by most brands are geared towards traditional wear. Formalwear for weddings now includes sherwanis and kurtas, where brands like Manyavar and FabIndia rule,” he points out.
Reflecting on the brand’s exit earlier from the Indian market, Francis says that its owners’ (S Kumars) inability to adapt the brand to changing consumer behaviour led to its downfall. The Finquest Group will need to clearly redefine its new positioning since Reid & Taylor now offers a mix of styles across casual and formal menswear.
Legacy brings credibility but it can also be baggage, remarks Rutu Mody Kamdar, founder of Jigsaw Brand Consultants. The challenge for Reid & Taylor lies in shaking off the heritage brand’ tag and making itself relevant to younger buyers who value modern style over nostalgia. “It needs to own the ‘quiet luxury’ space, timeless tailoring with a contemporary edge. That includes modern cuts, cultural collaborations, omnichannel presence, and aspirational storytelling,” suggests Kamdar.
E-commerce strategy will be key too. The brand will need to blend strong visuals with smart pricing and seamless strategy. Kamdar adds that Reid & Taylor needs to look at e-commerce as not just a sales channel but also a brand building platform.
(Published in Financial Express – Brandwagon)
admin
December 3, 2024
Writankar Mukherjee, Economic Times
3 December 2024
Flipkart is set to shortly start delivering medicines within 10 minutes, likely becoming the first quick commerce service to do so, intensifying competition in this red-hot market.
The Walmart-owned company’s Flipkart Minutes service has started enlisting local chemists in the metros from where the products will be sold using its last mile delivery partners, said a senior industry executive aware of the plans.
Flipkart is hurrying since it wants to be the first quick commerce service to sell prescription medicines. To be sure, the company’s partnerships with local chemists needs to be in sync with India’s drug norms for foreign-backed e-commerce operators which bars owning inventory. Also, Flipkart can forge tie-ups only with registered chemists.
“Flipkart wants to develop Flipkart Minutes into a full-fledged quick commerce platform. Medicines is a hitherto untapped opportunity since existing platforms deliver products in an hour to even 3-5 days,” said the executive cited above. “Flipkart will provide the platform for these orders and undertake the last mile fulfilment with its logistic partners, while the product will be sold by the local pharmacies who have all the valid licences,” the executive said.
Flipkart did not respond to ET’s email queries. Analysts said quick commerce for medicines is an untapped area so far but has high potential with healthier margins than food and groceries.
Devangshu Dutta, chief executive at consulting firm Third Eyesight, pointed out that undertaking quick commerce for pharmaceutical products would be a logistics-based issue and would need partnering with a broad network of stores.
“There are no real demand-side or supply problems for quick commerce in medicines in cities. Players like Flipkart have the edge of being a high traffic platform and a robust last mile delivery network. However, critically, the medicine business is also about discounts which can make a real difference for chronic patients or for long-duration and expensive treatments,” he said.
With the latest venture, Flipkart will deepen its presence in quick commerce and the online medicine segment, currently dominated by Reliance Retail-owned Netmeds, Tata 1mg and Apollo Pharmacy.
In 2021, Flipkart took a majority stake in Kolkata-based SastaSundar Marketplace, which owned and operated an online pharmacy marketplace and digital healthcare platform. Through this deal, Flipkart ventured into the health segment and integrated it into its main e-commerce platform selling medicines and other healthcare products.
Flipkart is a late entrant into India’s thriving quick commerce market that has the presence of Zomato’s Blinkit, Swiggy’s Instamart, Tata Group’s BigBasket and Zepto among others. Flipkart rival, Amazon, sells grocery and other products through its Amazon Fresh service but it has yet to foray into quick commerce.
Flipkart Minutes went live in Bengaluru this August and it is currently operational in Bengaluru, Delhi-NCR and Mumbai. The company is preparing to extend the service to launch it in a total of top 8-10 cities including Kolkata, Pune, Hyderabad and Chennai.
Flipkart has partnered with local grocers, kirana stores, besides adding its existing sellers in the marketplace for fulfilling grocery orders under Minutes. It is betting on free deliveries besides having a wider selection than existing quick commerce operators across most categories.
“Almost 60% of the orders are fulfilled by local grocers and some of the large sellers in the platform are also moving for quick commerce deliveries. Apart from opening new dark stores, Flipkart is also repurposing its existing city warehouses for grocery deliveries and as dark stores for Minutes,” the executive said.
According to a recent report by Grant Thornton Bharat, India’s quick commerce market is expected to surge nearly threefold to $9.94 billion by 2029 from $3.34 billion at present. The market expanded 76% year-on-year in 2023-24.
(Published in Economic Times)
admin
November 14, 2024
Economic Times
14 November 2024
The Swiggy IPO is making news for being the most successful in a decade in its category. The food and grocery delivery firm yesterday listed at a 5.6% premium to its IPO price of Rs 390, making it the first company with an issue size of over Rs 10,000 crore in the past decade to have listed above its offer price, ET has reported. The stock closed 17% above its issue price at Rs 455.95 in a weak market, surpassing analysts’ expectations of a tepid debut. The company’s market capitalisation at close on Wednesday was Rs 1.02 lakh crore.
Swiggy’s impressive debut also indicates the incoming deluge of cash in an emerging business, quick commerce. Swiggy plans to plough more cash into its quick-commerce business, Swiggy Instamart. Swiggy’s bigger rival, Zomato, is also planning to fatten its war chest. Zomato plans to raise fresh funds through a qualified institutional placement (QIP) despite sitting on $1.5 billion, or about Rs 12,600 crore. The money will also fuel its quick commerce business, Blinkit. Zepto, another quick commerce player, is also raising money. ET reported last month that Zepto is in talks to raise $100-150 million from a group of domestic family offices and wealthy individuals. It last raised $340 million in August. Swiggy Instamart, Blinkit and Zepto are the top three players with over 85% market share.
The floodgates of capital opening into the quick commerce sector would worry the big e-commerce platforms which have already started feeling the heat from quick commerce.
The quick rise of quick commerce
While quick commerce becomes the preferred medium for immediate needs and impulse purchases, e-commerce is favoured for more planned purchases like home, beauty and personal care. But now quick commerce firms are diversifying beyond groceries, small-value items, etc. and invading the home turf of e-commerce players.
Quick commerce is already conquering kirana, the neighbourhood small retail business, as well as hitting modern retail. As consumer preferences shift towards the convenience of last-minute grocery deliveries, quick commerce companies are outpacing traditional retailers, with 46 per cent of consumers surveyed reporting a cut in purchases from Kirana shops, a recent report has said. The quick commerce market size is expected to reach $40 billion by 2030, a jump from $6.1 billion in 2024, according to the report by Datum Intelligence.
Quick-commerce operators such as Blinkit, Swiggy Instamart and Zepto are aggressively trying to lure away consumers from large ecommerce platforms like Amazon and Flipkart by matching their prices across groceries and fast-selling general merchandise, triggering a price war in the home delivery space, ET reported a few months ago. This is a departure from the earlier pricing strategy of quick-commerce players who typically charged 10-15% premium over average ecommerce marketplace prices for instant deliveries, industry executives had told ET.
A recent ET study of prices of 30 commonly used products in daily necessities, discretionary groceries and other categories, including electronics and toys, in both ecommerce and quick-commerce platforms reveal the pricing disparity has been bridged. “The pricing premium which quick commerce used to charge for instant deliveries is gone with these platforms now joining a race with large ecommerce to offer competitive pricing to shift consumer loyalties,” B Krishna Rao, senior category head at biscuits major Parle Products had told ET.
The increasing competition is putting pressure on ecommerce majors to reduce delivery time.
“Price matching by quick commerce is to acquire market share and is part of market acquisition cost even when it might not be profitable at a per unit transaction level,” Devangshu Dutta, CEO of consulting firm Third Eyesight, had told ET. “They may have to sacrifice margins in the short term to get customers shopping more frequently.”
After challenging kirana and modern retail, e-commerce is the next frontier for quick commerce companies.
The challenge shaping up for e-commerce giants
With Swiggy, Zomato and Zepto raising a huge amount of money, the war between quick commerce and e-commerce is likely to turn bloody, besides increasing internecine competition among quick commerce players themselves.
Quick commerce, which began with the delivery of groceries and essential items, has now expanded to include a diverse range of products. This includes electronics, clothing, cosmetics, household goods, medicines, pet supplies, books, sporting equipment, and more.
E-commerce sector offers a vast opportunity for growth of quick commerce business. The Indian e-commerce market is projected to grow at a compound annual growth rate (CAGR) of 21% and reach $325 billion in 2030, as per Deloitte’s report released on Monday. This huge potential is luring big players. The Tata group’s ecommerce venture Neu is set to enter the quick commerce segment branded as Neu Flash, rolling it out to select users selling grocery, electronics and fashion, ET reported last month. Mukesh Ambani’s Reliance, leveraging its vast network of supermarkets, is expanding into the 10–30 minute delivery segment. Ambani wants to ensure quick commerce helps bolster its business ahead of an IPO of Reliance Retail, which was last year valued at $100 billion, and has backers including KKR, sources told Reuters recently.
Besides entry of big ones like Tata and Ambani, the deluge of fresh investment into business by the incumbents such as Swiggy, Blinkit and Zepto will pose a big threat to large e-commerce players Amazon and Flipkart. Swiggy has recently hired two Flipkart executives to boost its senior leadership. They have joined two other executives that Bengaluru-based Swiggy had hired from the Walmart-owned ecommerce major in the past few months.
Swiggy and Zomato are both assessing several new services as they diversify beyond their core businesses, ET has reported a few days ago. Swiggy is all set to launch a pilot programme for a services marketplace, labelled ‘Yello’, which will host professionals such as lawyers, therapists, fitness trainers, astrologers, dieticians, according to sources. It is also testing a premium membership service called ‘Rare’, for affluent customers providing them access to high-end events such as Formula 1 races, music concerts, upscale art exhibitions, in addition to VIP hospitality and priority reservations at luxury restaurants.
Zomato has previously been bold in its diversification moves by buying Paytm’s events and ticket business for Rs 2,048 crore. It is now trying out a concierge-like service to help users place online food orders over WhatsApp. Human customer relationship agents will provide the Gurgaon-based company’s new service instead of its usual approach of deploying chatbots, a person familiar with the move has told ET recently.
Apprehending challenges by quick commerce players, Flipkart has already started its own quick commerce business Flipkart Minutes. While still far behind its established rivals, Flipkart Minutes hit daily orders of 50,000-60,000 during its Big Billion Days sales, people with knowledge of the matter told ET last month.
Further investment and bigger players entering the sector will heat up competition among the quick commerce companies even as they will grapple with new challenges such as logistics as they expand. But a bloody war could soon be seen on the e-commerce battlefield as emboldened by huge popular response the quick commerce companies start invading on the well-guarded turf of Flipkart and Amazon.
(Published in Economic Times)
