Instant gratification has always been the motto of this 21st century, but this has got more tangible it seems in the last years or so when I added a new word to my vocabulary – Q Commerce. Consumers around the world are getting lazier and even less patient it would seem, giving rise to quick commerce, which offers to deliver groceries at my doorstep within 10 minutes. How is this possible? I can’t even figure out my grocery list in that amount of time. And even I did, would I be really in that desperate as to need soap or toothpaste delivered to me in the next 10 minutes? Even if I am not, the Q Commerce companies are trying to tickle my mind and make me believe that I should. Having done that they are then are tackling the impossible and scrambling to satisfy my greed and desire. It seems that outside the US and Europe, the quickest commerce race is intensifying in India. “instant commerce indistinguishable from magic” is the motto of one such company.
Quick Commerce is a unique business model which focuses on the micro to smaller quantities of fewer goods ranging from groceries, stationeries, personal hygiene products, to over-the-counter medicines. With a majority of people preferring to shop groceries online, especially after the onset of the pandemic, both industry heavyweights and new entrants are exploring this new business opportunity
The supply chain disruptions triggered by the Covid-19 pandemic led to the emergence of this new trend in the online grocery segment where the focus is on setting up smaller warehouses located closer to the point of delivery, and of restricting stocks at these stores to a focussed set of high-demand items, as against the traditional formula of well-stocked, large-format warehouses that the likes of Amazon might use.
While India is the third-largest grocery market in the world, it has the lowest (less than 1 percent) online grocery penetration compared to most of the major markets. That makes it a lucrative market that is significantly under penetrated. Quick Commerce start-ups hope to disrupt the e-commerce market while creating a strong habit of convenience available to customers. Of course, the speed and rapidity of the delivery will fuel more consumerism and impulsive buying and possibly destroy another lot of mom-and-pop stores. Why venture out even for a bottle of Shampoo when it can be delivered faster at your door than the time it would take you to get ready, make the purchase, and come back home?
Two major opportunities offered by the Indian market include consumables (home care, personal care, OTC drugs, beverages, fresh staples, pet supplies, packaged foods) and adjacent categories such as (books, gifts, cards, small electronic items, etc.). Although many items in these categories don’t fall into quick need of being delivered in 10 minutes, companies want to entice me is that I do begin to want it that fast. And they are succeeding. One factor that is perhaps contributing to this growth is that people in sufficient numbers are indeed willing to pay minimum delivery fees for 10 minutes delivery for products they don’t really need so critically. If a delivery is not really needed in 10-20 minutes, but it happens, no one is going to object.
Of course, the Q Commerce industry faces many challenges. This rush to deliver products in a super-fast manner has also raised several important concerns among various stakeholders in the industry like the toll this focus on speed takes on its workers, the folk who are the last mile point of contact for the customer. It is not unusual at all for the delivery staff themselves to admit that they often have to over speed, break traffic rules and drive on pavements and footpaths to get to their destination on time. There are reports of some platforms of penalising their delivery staff or orders being delivered incomplete as the scope of human error increases with the pace at which everything has to be done.
In urban gated communities, the main security gate is the first barrier as the security staff deployed have their own formalities to complete before letting delivery staff in and this consumes time too. With all that is involved, is this even a sustainable business model? No one really knows yet. All that is known so far is that the cost it takes to service a customer order in this mode is very high and therefore the probability of making money is very low. Most deliveries usually have only 1-2 items ordered which drastically brings down the bill value and therefore the economics of it all. Also, people will only pay so much for the speed and convenience promised. The market for 10 mins delivery will always be a niche one even though undoubtedly, there has been a huge spike in the numbers of people who sign up to these platforms. It is true that today, not just digitally savvy youngsters but even senior citizens are comfortable with ordering and paying online.
There is no doubt that COVID-19 had a greater impact on online behaviour as lockdowns across the world led to a surge in demand for doorstep delivery of essential goods, changing and forming habits that could remain well post the pandemic. Customers began to appreciate the speed, choice, ease, convenience, and safety of online delivery platforms. The days of waiting days or weeks for an order to arrive are long gone, and customers today are expecting deliveries in well under an hour. I often wish that these Q commerce companies were around when we have the Covid pandemic at its worst and the disruption that they are causing in the manner in which milk and butter are delivered, was first tried outlay delivering oxymeters, face masks, oxygen cylinders, and ambulances which were so greatly in need. In fact, even if the Covid induced urgencies are gone for the moment, these and other emergency services and supplies if delivered in 10 minutes or even 30 minutes a la Domino’s Pizzas( the original Q Commerce initiative ?) would be the real game-changer.
