The race for supplying groceries online is heating up. #Blinkit, #Dunzo, #Swiggy, #Zepto, and now #Reliance Retail is soon to enter the space. Their differentiation?
Shorter delivery times – 9/10/20 mins.
But, why focus on ‘NOW’? Is it important? More than you think.
1
Less than 17% order from online grocery for the speed as the primary reason. But it is the #1 motivation to get someone to start using the product.
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Remember the first time you used it?
I’m guessing it wasn’t a coupon.
It was likely something you probably forgot to buy in time.
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Once someone starts using the product, ~70% order at least once a week.
2
What are you most likely to run out of?
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Onion, Tomato, Potato? Shaving cream?
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But that is what gets you into the app – it isn’t what you stay for.
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Despite the push on fresh produce, the biggest categories in terms of order value are still packaged foods, personal & household care.
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This is where the real margin lies.
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Fresh & frozen produce are relatively low margin considering the wastage but are great products that are the stimulus to help:
a. Keep someone from not going to a super-market
b. Keep them locked onto the platform
c. Build and order with discretionary purchases
3
Real estate of a tiny screen can be super effective to:
a. make you feel like you are getting a lot of choices despite only having selected items.
b. push products that are high margin with discounts and deals.
c. help push increased order values using instant gratifications – like super-fast delivery/ visual stimuli.
d. restrict the user from shopping by comparing prices across apps or with an offline store.
Now imagine a brick-and-mortar business that:
a. paid no rent
b. could get their users to pay mark-ups
c. could tell them only to buy what they stocked
d. increase predictability 2x in the entire supply chain
Now wouldn’t that be valuable?
