WOTS #11

We live in an incredible tech ecosystem in India thanks to the combination of aspiring entrepreneurs, a supportive capital environment and a tech-savvy customer base. Quick-commerce has been one such phenomenon - dramatically transforming our daily lives in metro cities and (arguably), improved our standard of living in Mumbai to better than New York City (steep Doordash fees and slow fulfillment times vs Indian offerings).

Over the past few months, Zepto , Swiggy's instamart and Zomato's Blinkit have led the charge in building out new categories for non-obvious impulse categories based on pointed data searches adding offerings such as basics apparel, pooja needs and baby care.

Zepto has taken it a step further by introducing a Zepto Cafe offering some easy-to-make items such as chai, maggi, pizza and so on

Similar to Domino's which as a food company forward integrated to a delivery company, Zepto has backward integrated into a food and drink manufacturer. They seem to have tied up with Chaayos for this experiment - which I think will be the catalyst for further disruption in the space -

• Can the distribution built by the likes of 星巴克 , Third Wave Coffee and Blue Tokai Coffee Roasters on Swiggy and Zomato with good locations and years of reviews and ratings be simply disrupted if the Q-commerce folks tie-up/ vertically integrate and offer reasonable quality beverages of their own or third party brands? I could imagine an upstart coffee company such as Bombay Coffee Roasters or Lavazza whose product is as good as the national chains but have no major store presence could jump at this opportunity. After all, the single most important factor in enjoying a beverage is the speed with which it comes to your hands - 10 min delivery triumphs 30 minutes of waiting!
• In categories where there is a fair amount of impulse or peak buying - think jewelry purchases during Dhanteras or kurtas before Republic day - most customers are more concerned with getting the product painlessly rather than fretting about the specific brand itself. For example, a 5gm gold coin from TANISHQ JEWLLERYS has the same customer utility as one from Kalyan Jewellers and customers would prefer the one that does not involve them waiting in a 1 hour line outside the store. These sort of sales could easily move to q-commerce.

Quick commerce companies are pushing the boundaries on what categories they could be - it was difficult to imagine a use case as recent as a year back that we could get a Stovekraft Limited cooker or gas stove delivered to us in 15 minutes. For consumer brand companies, an additional channel has opened up with potential to increase order frequency while traditional forms of distribution have to compete with ultra-convenience services. 2024 will be even more interesting to watch to consider which companies/ parts of the value chain win in this new ecosystem.