What is Quick Commerce?
Quick Commerce, or Q-Commerce, is the new form of e-commerce in which goods are delivered to customers quickly, often within an hour. Earlier goods were delivered to people within 1 to 3 days. However, with the introduction of quick commerce, the whole shopping landscape has changed. With changing customer aspirations and rising income levels consumers prefer convenience and efficiency over anything.
The penetration of quick commerce has been increasing on YOY (Year-on-year) basis. We have provided a graph below highlighting the increase in quick commerce market size in India. Moreover, the industry size has grown in 2023-24 at a rate of 73%
There are a few quick commerce platforms that occupy a major share in India including Blinkit (holding around 40% market share), Swiggy Instamart and Zepto (holding around 30% share each), BB Now (holding around 7% market share).
Why Quick Commerce is Growing At Such Huge Scale?
Quick commerce is penetrating at such a huge scale due to various reasons.
1. Convenience
The first and foremost reason for penetrating quick commerce in India is due to the convenience it offers to the customers. Customers want to avoid visiting a physical store to get the products.
2. Expansion of product variety/ SKUs
Quick commerce is not limited to just groceries. The SKUs offered by quick commerce platforms are rapidly expanding. You can now get everything delivered to your doorstep within 15 to 30 minutes including groceries, electronics, clothes, beauty products, pet essentials, and even an iPhone. While your local supermarket has 1000-1500 SKUs, quick commerce platforms have as high as 25,000 SKUs.
3. 24*7 Services
Quick commerce channels offer you round-the-clock services. While your local supermarket has fixed timings it’s not in the case of quick commerce channels. All this is possible due to the dark stores located in your nearby area.
4. After-sales customer support
Quick commerce platforms offer 24*7 sales support to the customer to address their queries. You can easily return/exchange your products if you are not satisfied or the product is not up to the mark.
5. Discounts and offers
Quick commerce channels offer regular discounts and offers to their customers. As quick commerce channels make purchases in bulk, they can offer competitive prices to the customers.
Quick Commerce vs E-Commerce
E-commerce refers to the delivery of goods by e-commerce platforms such as Amazon and Flipkart, goods are delivered within 1 to 3 days. Quick commerce is the new e-commerce where goods are delivered within 15 to 30 minutes.
While e-commerce offers a wide range of SKUs, quick commerce offers a limited range due to limited space in dark stores.
Quick commerce is ideal for last-minute or urgent shopping while e-commerce is perfect for planned shopping. While quick commerce focuses primarily on speed and convenience, e-commerce focuses primarily on product selection across categories.
AOV (Average Order Value) of Quick Commerce Platforms
The average order value of the quick commerce platform is around Rs 500. While the major market stakeholder Blinkit has an AOV of Rs 607, the AOV of Big Basket stands at Rs 500. The AOV has been increasing YOY (Year-on-Year) basis due to the increasing SKUs by quick commerce platforms and increasing consumer aspirations and demands.
In a Nutshell
While the future of quick commerce platforms seems bright due to their growth potential, still majority of platforms have not achieved profitability. This is a major concern for investors who have invested in these quick commerce platforms.
But as a consumer, quick commerce is a blessing for us. It not only solved convenience but also contributed towards the GDP growth of India. Analysts consider quick commerce as a threat to e-commerce as they are slowly eating their market share.
