Gaps & Opportunities for Quick Commerce Companies
Everything collectively in our society, shaping our behaviors, Covid-19 accelerated this shift in action, and another shift is happening just right now.
Products & Services used for convenience before covid-19 became an essential lifeline. One good example is Quick Commerce (yes, Quick Commerce),
“Quick Commerce is next-generation eCommerce where customers get orders in an hour or so.”
Pre Covid-19, It was a convenience, but now it becomes a mainstream need for food, beverages, grocery, and categories around it. People’s demands are shifting, and they appreciate other types of products delivered in 1 hour.
Old school eCommerce (next day, two days deliveries) vs. 1–2 hour deliveries is a large difference; customers will naturally welcome any quicker deliveries.
Opportunities for Quick-Commerce Companies
If I get my iPhone, my new t-shirt, or my watch delivered within the same day (in a few hours) with the same competitive market rates, why should I wait for two days?
Currently, quick commerce companies struggle with a wafer-thin margin industry like Groceries, competition, intensive food restaurants. They can add additional value to add different categories like Fashion & Luxury Retail, Mobile & Tablets, and Computer & office products.
Why can’t traditional eCommerce answer this?
Traditional eCommerce marketplaces work on complex models in various locations, from an internal warehouse to vendor shops & warehouses. Collecting and shipping products in widespread areas in a couple of hours is not an easy and business viable option. There is only one option to shift towards a quick-commerce business model to rely on retailers’ locations and quickly take & deliver in a few hours.
Opportunities for Quick Commerce Companies
If I get my iPhone, my new t-shirt, or my watch delivered within the same day (in a few hours) with the same competitive market rates, why should I wait for two days?
Currently, quick commerce companies struggle with the wafer-thin margin industry like Groceries, competition, intensive food restaurants. They can add additional value to add different categories like Fashion & Luxury Retail, Mobile & Tablets, and Computer & office products.
Companies in the Middle East, like Talabat, Zomato, Deliveroo, Instashop, el Grocer, SWAN, etc., have opportunities to grab this opportunity before eCommerce Giants (Amazon & Noon) in the region will fill the gap.
How Quick Commerce Companies can grab these opportunities?
1- Retailer’s Technology Integration: It was easy for quick commerce to get food cooked on demand and deliver in 1 hour. But, when it comes to off-the-shelf products, the biggest challenge will be the availability of products in retail stores & its detail on marketplaces — seamless technology integration and infrastructure for predictive and timely deliveries.
2- Transforming of Products & Strategy: Quick commerce companies are mainly working in Food & Groceries are fighting to take next pie of share from already competition intensive market, a shift in strategy needed to have a balanced approach to expand offerings in emerging new markets.
3- Transforming of delivery Infrastructure: Quick commerce companies are 80% relying on motorbikes to deliver quick orders. There will be an additional need for a bit bigger delivery infrastructure while adopting other categories.
4- Better Pricing Strategy: Profit margins in Luxury Fashion, Mobile & Computers are way different than high competition grocery & food orders. As eCommerce marketplaces are charging high delivery & cash handling fees (seriously?) same charges with a couple of hours delivery will be naturally acceptable.
That’s all, please feel free to add your comments, suggestions and questions.
