Quick commerce in India just had a rebirth. It’s a great time to be a consumer again. My last four big orders were on Amazon Now. Before I explain why, here’s what has changed:
There are now 7 serious players - Eternal/Blinkit (sitting on $2B cash), Swiggy/Instamart ($1.8B after QIP), Zepto (will raise >$1B IPO), Flipkart Minutes, JioMart (tracking 2nd place), Tata BigBasket, Amazon Now.
Just when you thought the space was settling into a steady state, a new price war has begun. Blinkit is the only holdout, relatively speaking. Though Blinkit does not believe in heavy discounting, it’s now being forced to respond to the competitive intensity, which might impact margins just as the business line was becoming profitable for Eternal.
Instamart freebies are hard to miss. It’s aggressively pushing Noice, giving away bread, eggs, paneer, sweets, and more for free as the new private label scales up. Noice is an interesting play to watch.
The discounts on Amazon Now for comparable SKUs for my purchases hit 60-70%, a little more than Instamart and a lot more than Blinkit. Add free delivery, no handling charge, free cash at higher AOVs, and extra cashback on their ICICI co-brand card. Amazon Now becomes a no-brainer.
The only thing that has made me overcome the price barrier and switch platforms is if one of them has catalog or SKU exclusivity, even for seemingly substitutable/commodity products, because I have existing brand affinities. This largely applies to packaged foods/FMCG, the core high-frequency categories.
Although Amazon Now is a distinct in-app service, Amazon surfaces its Now listings at the top of regular search whenever the item is in a nearby dark store. It’s a deliberate nudge to make Amazon the first port of call even when consumers open the app for traditional planned e-commerce. It's to help users realize that Amazon is making its ‘everything store’ quick.
That’s because over the last two years, qcomm incumbents took ecomm share away from Amazon as they added higher value SKUs to their dark stores. Amazon is now trying to reverse that through heavy discounting and nudges.
Zepto too has axed all fees. Handling, delivery, surge, rain, late night. The trade-off is that deliveries sometimes stretch to up to 20 minutes with order batching as the default. The discounts have to be clawed back somewhere.
Another thing common across the apps is maximizing ad space, which comes with scale. They are integrated thoughtfully into the search/purchase journey to help us with choice.
Zepto's post-checkout page feels like Times Square, with the order tracking map relegated to a tiny thumbnail. Mostly brand ads to monetize captive eyeballs since there’s no risk of cart abandonment at this stage.
Battle lines have been redrawn, the sector feels alive again, and consumers are winning for now. We are questioning the moats for individual brands again. But how long will the party last?