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The 45-year-old Noida resident Sarmishtha Sahoo dons multiple hats through a single day. On the personal front, Sahoo is a mother to her 16- and nine-year-old daughters and a seven-year-old Golden Retriever dog—Mufasa. She and her husband have professionally helmed a multi-crore corporate upskilling firm in Noida for the past 15 years.
Sahoo, incidentally, is also one of the most prolific users of Zomato’s quick commerce marketplace, Blinkit.
Quick commerce has disrupted the entire E-commerce world, causing the established duopoly of Amazon and Flipkart to sit up and take notice.
“Thanks to balancing work, life, and everything else in between, innumerable things tend to fall through the cracks. Quick commerce has honestly become a lifesaver—in the past four days, the range of things that I have ordered on Blinkit includes sanitary pads, a handheld massage gun, charcoal sketching pencils, a Hot Wheels die-cast toy car set, and compression sleeves for legs. I no longer need to panic about forgetting something or specifically take time out to physically go to a departmental store to fish out items from a list,” Sahoo says.
Valued at USD 3 billion in 2023, the quick commerce market is projected to hit USD 40 billion by 2030, growing at an impressive CAGR of 45%.
This is one of millions of examples of how quick commerce emerged as one of the most disruptive services of 2024. Armed with the promise of 10-minute deliveries of essential groceries and items well beyond that, quick commerce has emerged to disrupt the entire E-commerce world, causing the established duopoly of Amazon and Flipkart to sit up and take notice. In the process, commerce, in the overall sense, has also shifted even further towards mobile-first experiences.
A Steady Growth
An investor report published by brokerage firm JM Financial earlier this year indicates that the quick commerce industry was cumulatively valued at USD 3 billion at the end of the 2023 calendar year. By the end of this decade, it is projected to reach USD 40 billion in market valuation—surging ahead at a cumulative annual growth rate (CAGR) of nearly 45%.
Meanwhile, the overall E-commerce industry is expected to grow at about a fourth of the pace of quick commerce ventures—market researcher Statista projects it to reach a valuation of USD 113 billion by 2030, at a CAGR of just over 11%.
The shifts in dynamics are apparent—as of the beginning of 2024, quick commerce accounted for about 5% of the online, mobile-powered E-commerce industry. By 2030, it is expected to be over 35%, suggesting that two of every five items bought online in India could soon be through one of the many 10-minute delivery platforms.
These statistics highlight that the sky is the limit for quick commerce or Q-Commerce ventures.
Companies, on this note, are cashing in too. According to the latest available data from the September quarter, Zomato’s Blinkit earned Rs 1,156 crore as quarterly revenue, while Swiggy’s Instamart earned Rs 490 crore during this period. Zepto, meanwhile, has emerged as India’s most valued startup with a net valuation of USD 5 billion and closed FY24 at a net revenue of Rs 4,456 crore—implying that its net quarterly revenue would be close to that of Blinkit’s.
The shifts in dynamics are apparent—as of the beginning of 2024, quick commerce accounted for about 5% of online, mobile-powered E-commerce.
While these three firms are leading India’s mobile phone-based quick commerce charge, others are not far behind. In August, E-commerce veteran Flipkart launched its quick commerce service, Minutes’. In November, media reports pointed out that Amazon is also set to enter the Q-commerce fray with a service called ‘Tez’. The Tata group’s online medicine delivery platform, 1mg, commenced 60-minute order deliveries this year, while another Tata platform, BigBasket, began an instant delivery service, BBNow, in response to the prevalent trend.
Tip of the Iceberg
Even though this onslaught was in the making for a while, perhaps no one quite imagined how this service would explode. In August 2022, Blinkit launched a print-out delivery service in select metropolitan markets. While early reactions said there would be no takers, the service is increasingly picking up the pace of adoption thanks to its unparalleled convenience. Since then, Blinkit has also added a host of discretionary products and services, such as Lego and Hot Wheels toys, Sony’s PlayStation 5 gaming console, and even the Apple iPhone.
Zepto, meanwhile, operates its own self-branded cloud kitchen for instant food deliveries, striking out at the competition with its own unique proposition. And this expansion drive seems to have no end. In December last year, Blinkit CEO Albinder Dhindsa tweeted about launching its services in Hisar (Haryana) and Lonavala and Khandala (Maharashtra). During this time, the company launched the stocking of special-edition Christmas plum cakes from some of India’s most legendary bakeries. Also, it introduced a range of Decathlon’s inventory on its platform.
Much of this rapid expansion underlines that quick commerce is here to stay. In its investor note cited above, JM Financial analysts said, “The COVID-19 pandemic accelerated demand for online grocery not only in India but also globally. It also led to the evolution of consumer needs due to restrictions on movement and consumer reluctance to venture out. As a result, consumer dependence for purchases typically fulfilled by offline channels—such as unplanned purchases, indulgence purchases or low shelf-life—shifted towards platforms offering on-demand services.”
“Given the large addressable market and a fundamental shift in consumer behaviour, initially, there was a sudden surge in the number of platforms offering on-demand services. However, the complexity of the business model, lack of clarity over sustainable unit economics and a prolonged funding winter for investments meant that the market consolidated quite rapidly. Despite that, the market has expanded 10x+ over the last couple of years,” it added.
This assessment today is on point. Every year, an incrementally additional number of individuals start using a wider array of online services, driven by the ubiquity of digital payments and more. As a result, getting essentials delivered home makes complete sense—and while there is a convenience fee that each order levies, the range of promotional discounts on these platforms almost always means that in a like-for-like comparison, the net invoicing amount for any ensemble order is lesser than what a physical brick and mortar store charges.
Given that Quick Commerce stocks inventories at scale, no single FMCG business would have the scale required for such deep discounts. This is a win-win situation for consumers and businesses alike.
By Vernika Awal
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