2024. Year of massive changes. Blinkit, Instamart - people heavily rely on these quick commerce apps. But are they even profitable?
In India, the quick commerce market is forecasted to generate a huge $3,349 Million, all alone in 2024. The market is expected to grow at a CAGR of 24.33% by 2029. And if dived deep into the numbers, there will be around 60.6 Million users using quick commerce everyday for their needs.
Talking about D2C brands, the market back in 2022 was valued at $12 Billion. But by 2027, the number would surpass $60 Billions. Isn't this huge?
But why are we talking about D2C brands and quick commerce?
Quick commerce is revolutionising the way e-commerce operates, more particularly for D2C brands. The ultra-fast delivery (often within minutes and hours) has changed (reshaped) consumer expectations and the way businesses operate.
How is Quick Commerce Doing in India?
Let's talk specifically about India.
The past two years have been game changing for the Q-commerce industry. After the COVID-19 pandemic, apps like Blinkit, Zepto, Instamart, BigBasket saw massive growth. Why?
There was obviously a need for quick and contactless deliveries which Q-commerce was able to offer. Today, Q-commerce accounts for approximately 13% of the $5.5 billion online grocery sector in India.
And, this figure is expected to grow as consumers increasingly demand speed and convenience.
Let's look into the key drivers behind these figures:
Consumer demand
Modern consumers, especially younger demographics, prioritise both speed and convenience. Q-commerce offers the same. It helps consumers receive the products within minutes or hours.
Technological advancements
Innovation in logistics, inventory management, and order processing have made Q-commerce grow faster (technically rapid delivery feasible).
Pandemic
The shift from shopping from brick and mortar shells to online happened during the pandemic. This created a lasting demand for quick delivery services.
Q-commerce and D2C brands: Can anything happen out of this relationship?
Let's look between the lines. The relationship between Q-commerce and D2C brands is quite mutually beneficial. Quick commerce platforms provide D2C brands access to a distribution network that ensures rapid delivery. In this way, the D2C brand can improve customer satisfaction rate.
In turn, D2C brands offer a diverse product range that attracts more customers to the Q-commerce platform.
Hence, by trying q-commerce, D2C brands can expand their market reach. For example, this Instagram Reel, showcases how Moringa, a plant from tier 3 village is available to everyone, speedily through Q-commerce app (Blinkit).
Traditional e-commerce mods often limit brands to certain geographies. Certainly due to logistical constraints. Q-commerce on the other hand, with its localised dark stores and micro-fulfillment centres, helps brands reach customers - both in urban and suburban areas, quickly and efficiently.
Some Indian D2C brands that has leveraged Q-commerce
There are many D2C brands who are now on quick commerce apps, expanding their business. But to name a few, the popular ones are:
WOW Skin Science
Mamaearth
Pee Safe
boAt
The Man Company
What Are The Benefits of Quick Commerce for D2C brands?
See, every brand is here to stay, to expand. And if they have decided to step into the quick commerce space, there obviously are many benefits, but the few major ones are:
Improved customer satisfaction rate
The primary benefit of Q-commerce for D2C brands is the ability to meet customer expectations for fast delivery. This leads to higher customer satisfaction. Customers stay loyal, they often appreciate the convenience of receiving products quickly.
Increased sales and revenue
Faster delivery times can drive higher sales and revenue. Customers are more likely to make impulse purchases when they know that their orders will arrive quickly. Additionally, the ability to deliver products swiftly can reduce cart abandonment rates.
Competitive advantage
Offering quick delivery gives the brand a competitive edge. In a market that's so hugely crowded, if a brand promises to deliver products within hours - this single step can differentiate it from its competitors, attracting more customers.
Some Strategic Advantages of Q-commerce for D2C Brands
Done with benefits, let's now talk about the strategic advantages:
Improved inventory management
Q-commerce often uses sophisticated inventory management systems. This helps D2C brands keep track of stock levels in real-time. The whole inventory management system ensures that popular products are always available, and there is no risk of stockouts.
Cost efficiency
By making the most out of the logistics network of Q-commerce platforms, D2C brands can reduce their own shipping and handling costs. This can lead to overall cost savings and improved profit margins.
Better data analytics
Q-commerce platforms provide valuable data on customer buying habits and preferences. D2C brands can use this data to tailor their marketing strategies, improve product offerings, and optimise pricing.
How's Quick Commerce impacting SEO and Digital Marketing for D2C Brands
If a D2C brand wants to step into the quick commerce space, it no longer has to go with the traditional way of marketing. Because quick commerce, in itself, is a whole different ball game. For example:
SEO Optimization
For D2C brands, to reach a broad audience, they must optimise product descriptions. Try local SEO to target specific areas. Do relevant keyword research to rank higher in search results.
Digital Marketing
Q-commerce has also transformed digital marketing strategies. Brands should now get into using location-based advertising to target customers within specific delivery zones. Social media campaigns highlighting quick delivery options can attract more customers and drive sales.
Customer Reviews and Feedback
Quick delivery often leads to positive customer reviews, which can improve a brand's online reputation. Brands have to put much effort into encouraging satisfied customers to leave reviews to attract more organic traffic.
How Q-commerce works best for improving customer experience?
There's a reason why popular D2C brands like Mamaearth (Blinkit, Zepto), Licious (Blinkit), Sleepy Owl Coffee (Blinkit), Oziva (Zepto) have stepped into the Q-commerce industry - and the major one is improved customer experience. But let's understand how Q-commerce is able to do that:
The most obvious benefit of Q-commerce is the speed of delivery. Customers no longer have to wait days for their orders, which significantly changes the shopping experience. Whether it's groceries, daily essentials, or even healthcare products, Q-commerce ensures that items are delivered quickly, often within 10 to 30 minutes.
Q-commerce platforms use advanced logistics and inventory management systems to make sure that orders are fulfilled accurately and efficiently. This reliability builds customer trust and encourages repeat purchases.
Many Q-commerce platforms offer personalised services. For example, tailored product recommendations. They also offer exclusive deals based on purchase history. This personalised approach improves overall customer experience.
The Challenges of Integrating with Q-commerce
Logistical Complexities
One of the main challenges of integrating with Q-commerce is managing the logistics. Brands need to ensure that their products are always available in multiple micro-fulfillment centres to meet delivery demands. This requires better inventory management systems and efficient supply chain operations
High Operational Costs
Maintaining the infrastructure needed for Q-commerce, including dark stores and a fleet of delivery personnel, can be costly. Brands need to weigh these costs against the potential benefits of increased sales and customer satisfaction.
Rider Safety and Regulations
Ensuring the safety of delivery personnel in congested urban areas is a significant concern. Additionally, brands must check out various regulations and compliance requirements related to rapid delivery services.
Technological Integration
Integrating with Q-commerce platforms requires significant technological investment. Brands need to adopt advanced order management systems and ensure seamless integration with existing e-commerce platforms.
What is the future of Q-commerce and D2C Brands?
The future of Q-commerce in India looks promising. As consumer demand for convenience continues to rise, more D2C brands are likely to adopt this model. The market for Q-commerce is expected to reach $5.5 billion by 2025, driven by increasing consumer preference for fast and reliable delivery services
All in all, Q-commerce is a game-changer for D2C brands in India. If a brand is able to tap on to the industry at the right time, it can reach a broader audience. What's more? Well, a lot will happen in the near future, we'll keep you updated!