Q-Commerce: Can quick deliveries win customers for life?

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Delivering on time is a thing of the past now. Delivering quicker than 10 minutes is more the trend to watch. Does this help a brand win its much-needed customer base?

By Yash Bhatia

Quick commerce, in basic terms, means delivering the goods in 10-20 minutes. Various delivery apps like Dunzo, Zepto, Blinkit, and others are attracting consumers across major cities by offering faster delivery services and this trend got fueled by the pandemic. The trend has also caught the eye of investors and they are amused to bet their money on it.

The Quick commerce sector in India is evolving at a high rate, and it has also raised the customers’ expectations. According to the report by Reedseer, the quick commerce market in India is expected to witness a 15x growth by 2025 and reach a market size of close to USD 5.5 Billion markets.

The report also stated that most of the demand for quick commerce apps is generated by millennials and Gen-Z consumers which are from mid to high-income households (INR 5 lakh to INR 2 crore) in metro and tier 1 cities. 

The delivery time is turning out to be the new USPs of the brands, thanks to the magic of the evolution of the internet. The brands are promising 10-20 minutes delivery service, and the space is heating up. As of now, Indian customers can receive anything from a packet of milk to a dicer faster than it takes to respond to an email.

With this service, customers can enjoy liberty without planning and the time between desire, action, and gratification has shrunk down to zero.

But with these faster deliveries, the pressure on the delivery executive has increased which can in return can lead to mishaps. When Zomato’s founder Deepinder Goyal announced the 10-minute service, he faced a lot of backlash from the people as in this, the delivery executive’s life can come at a risk. As faster deliveries mean faster driving but later they clarified that they are placing more dark stores/fulfillment centers to fulfill the needs of the customers.

We talked to the brands, to know their perspective on the quick commerce service and understand whether businesses find it a lucrative way or not.

The viability of Q-Commerce

Pranay Jain, Founder & CEO, BodyFirst stated on this and highlighted that, “The retail sector in India has caught up with the rapid delivery system and all the platforms are now vying to offer the quickest delivery time. But, a lot of people including me disagree with the standard 10-20 minutes delivery being hazardous and unnecessary. I believe that a time frame of 2-3 hours or probably a day is fine if done responsibly. I believe that quick delivery service should not be standard and the additional fees should be charged so that the customer can use the service only for necessities, but not for impulse purchases.”

Harshavardhan S, Co-founder, and CEO, Lil Goodness believes that this quick delivery service will just take a share of just the e-grocery market which would be around 10-15% of the overall grocery e-commerce market and the long-duration deliveries would still dominate the market.

He added that, “There are certain specific cases which super instant grocery serves where they can provide convenience to their customers. As an impulse brand, we would love our customers to experience instantly, but the reality is that a lot of food impulses are served through fresh food delivery partners within 20-45 minutes and that would be the expectation of the grocery market also.”

Major Industry experts also believed that quick delivery is the future of delivery service, but the 10-minutes promise by the brands is not fair for the delivery executives and it would end up in a timeframe of between 30-45 minutes.

Ravina Jain, Founder & CEO, The Skin Story & The Beard Story stated this and mentioned that “I have heard both praise and criticism for fast shopping but in my opinion, it’s not worth the risk to the drivers or the potential drop in quality that could result from having to get there so quickly. Customers, including the impulsive buyers which prefer the convenience of the platform,
will face criticism, and eventually, it will not become the norm in the delivery system.”

From micro collaborations and alternate revenue streams to improved unit economics, there are six Q-Commerce trends to watch out for. Read more about it here.

Understanding customer preferences

The quick commerce model can only be succeeded if the model is located pretty close to the customers. And in that case, it can be effective and fast if the brand can understand the niches of the product that the customers need the most.

Businesses that are successful in this model also tend to stock the products that are most commonly purchased products or products that are popular among Gen-Z and millennials. However, it can be different for different areas, and understanding it can be difficult at times.

Pranay Jain while describing the strategies told us, “In today’s era, social media is the goldmine of researching the wants and the needs of our target demographics. We communicate with our customers on various social media sites, perform online polls, and learn about their preferences, study the competitors and change the services accordingly.”

Vikas Kumar Agarwal Founder, Go Grocer told his strategy, “We are constantly taking feedback and tracking the customer reviews at the delivery service. As it becomes important to know what the customers expect and we can understand how much they are willing to pay for that service.”

Harshvardhan said, “We would find the data and statistics looking at the nearest kirana stores stocks as it would be the best indicator to know the local customer preferences. This would help us to understand and know the stimulation of the customers that what they need within 5-10 minutes, which can be replaced with the convenience of quick commerce deliveries.”

Popular product categories

Initially, the quick delivery applications were delivering grocery products and essential items as in the pandemic people didn’t want to go out of their homes and it became popular. There is no specific product category that can be picked in the quick delivery service or in the future, every category will be picked by it.

Harshavardhan said,” Any product that the customer requires within 30-45 minutes and which can be delivered by a person on a bike can lend itself to this model. Categories like electrical, hardware items, or even medicines/wellness-based items lend themselves to quick commerce.”

Pranay Jain stated “To a larger extent, the expansion of the Internet and rise of digitalization have influenced and even stimulated the new and burgeoning consumer culture. The FMCG category is driving the rise but businesses in the other sectors can also find success with the quick commerce model. Eventually,
it can meet the consumer needs and save time.”

“In my opinion, it must be implemented in a responsible and secure manner if the businesses want to incorporate the quick commerce Model,” he added.

Raveena Jain stated her opinion, “Who doesn’t want quick delivery nowadays? Despite growing public opposition, quick commerce continues to expand and will grow to include urgent products like the pharmaceutical industry as we need medicines immediately. However, everyone involved in the delivery process should take precautions to ensure the highest level of safety, and the delivery time should be closer to two or three hours rather than ten or twenty minutes.”

In the coming years, we would see every product category dive into the quick commerce model whether it would be fashion, FMCG, medicines, etc. This would totally change the e-commerce landscape.

First published in the September – October 2022 issue of Phygital magazine.

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