The ~$600 Bn grocery industry in India is undergoing
a similar disruption enabled by eGrocery platforms,
that have done a tremendous job in transforming how
people shop for their groceries. While these platforms
have solved for a number of consumer needs ranging
from improved access to higher convenience, the largest
challenge still faced by an average Indian is around
affordability and eGrocery platforms have the potential to
effectively resolve this aspect.
With increasing prevalence of top-up and unplanned purchases in metro and Tier1, convenience and speed of delivery have become important; super-specialized platforms have emerged to offer convenience and instant deliveries.
Indian grocery traditionally has been a primarily unorganized market, wherein more than 90% of the market is driven by traditional ‘kirana stores. However, in the past decade or so, organized brick & mortar and online channels have gained prominence. Online grocery has been boosted by covid-19 related tailwinds, with the GMV run-rates of major players growing by 70%+ during the period. This has led to an increased focus on the sector by large conglomerates as well as mature online players.
During Covid, while there were some challenges in the initial days of the lockdown, the segment has grown significantly. Most notably, fresh vegetables and fruits have seen 144% growth, while FMCG products grew 150%. While a lot of this growth will normalize to some extent as the COVID situation subsides, a significant portion of new users will persist and drive growth.
With the increasing demand and competition, it becomes imperative for brands to stay ahead by making data-driven decisions. In order to equip the brands to win in the online space, BigBasket Brand Intelligence and RedSeer have partnered to author this report. The idea here is to combine high-quality RedSeer IP on broader trends in the sector and BigBasket’s grocery expertise to create a ready-reckoner for brands, as they make strategic, product or channel-related decisions.
This report is an abridged version of the larger report which can be subscribed as per need. Besides the key trends of the sector, customer insights etc., this report deep dives on key categories such as Snacks & Packaged Foods, Beverages, Personal Care and Home Utilities, we present the quarterly growth in sales in the past 5 quarters with various sub-category splits.
With increasing prevalence of top-up and unplanned purchases in metro and Tier1, convenience and speed of delivery have become important; super-specialized platforms have emerged to offer convenience and instant deliveries.
Indian grocery traditionally has been a primarily unorganized market, wherein more than 90% of the market is driven by traditional ‘kirana stores. However, in the past decade or so, organized brick & mortar and online channels have gained prominence. Online grocery has been boosted by covid-19 related tailwinds, with the GMV run-rates of major players growing by 70%+ during the period. This has led to an increased focus on the sector by large conglomerates as well as mature online players.
During Covid, while there were some challenges in the initial days of the lockdown, the segment has grown significantly. Most notably, fresh vegetables and fruits have seen 144% growth, while FMCG products grew 150%. While a lot of this growth will normalize to some extent as the COVID situation subsides, a significant portion of new users will persist and drive growth.
With the increasing demand and competition, it becomes imperative for brands to stay ahead by making data-driven decisions. In order to equip the brands to win in the online space, BigBasket Brand Intelligence and RedSeer have partnered to author this report. The idea here is to combine high-quality RedSeer IP on broader trends in the sector and BigBasket’s grocery expertise to create a ready-reckoner for brands, as they make strategic, product or channel-related decisions.
This report is an abridged version of the larger report which can be subscribed as per need. Besides the key trends of the sector, customer insights etc., this report deep dives on key categories such as Snacks & Packaged Foods, Beverages, Personal Care and Home Utilities, we present the quarterly growth in sales in the past 5 quarters with various sub-category splits.
As one of the fastest growing e-commerce models, RedSeer latest report highlights quick commerce platforms such as Swiggy's Instamart, Dunzo, and more.
Survey & Comparative Analysis of TATA Croma and NEXT RetailPrashant Dubey
Comparative Analysis of Modern Formats of Retail Outlets with focus in Products, Services and Related Attributes” (specific to TATA Croma and NEXT Retail)
Aqualisa Quartz - Simply A Better Shower (HBR Case Study)Arjun Parekh
Probable Solution to HBR Case on Aqualisa Quartz. The Presentation consists of info about Channel Distribution, Development of Quartz Shower Valve, UK Shower Market, Initial Sales Results, 4Ps of Marketing for Aqualisa, A shift in Marketing Strategy.
Project On Online grocery_MBA Marketingsagar reddy
1) To study the perception of grocery retailers towards click and brick model in Bangalore.
2) To understand the impact of brick and click model on customer retention.
3) To understand the customer willingness to purchase grocery online from local
retailers.
A detailed report on ONE PLUS (more specifically One Plus 3, and how it was a game changer for them). This report covers from their start till recent developments on One Plus 6, analyzing various aspects of research and development. The report consists of the following sections: Initial Marketing Strategy used, Macro Analysis, Legal Analysis, Economic Analysis, Socia-Cultural Analysis, Technological Analysis, Environmental Analysis, Micro Analysis, Target Market, Distribution Channel, Suppliers, Competitors, Customers, Current Target & Marketing Mix, SWOT analysis and Recommendations.
Ground Zero 4.0 | Scaling Up - Event ReportRedSeer
Executive Summary
The report is compiled of all the topics that were discussed at Ground Zero 4.0 and has been
segregated based on RedSeer’s research and panel inputs.
Key Findings:
1. Digital India
2. Retail
3. D2C
4. Education
5. Healthcare
6. Grocery
7. Etailing
As one of the fastest growing e-commerce models, RedSeer latest report highlights quick commerce platforms such as Swiggy's Instamart, Dunzo, and more.
Survey & Comparative Analysis of TATA Croma and NEXT RetailPrashant Dubey
Comparative Analysis of Modern Formats of Retail Outlets with focus in Products, Services and Related Attributes” (specific to TATA Croma and NEXT Retail)
Aqualisa Quartz - Simply A Better Shower (HBR Case Study)Arjun Parekh
Probable Solution to HBR Case on Aqualisa Quartz. The Presentation consists of info about Channel Distribution, Development of Quartz Shower Valve, UK Shower Market, Initial Sales Results, 4Ps of Marketing for Aqualisa, A shift in Marketing Strategy.
Project On Online grocery_MBA Marketingsagar reddy
1) To study the perception of grocery retailers towards click and brick model in Bangalore.
2) To understand the impact of brick and click model on customer retention.
3) To understand the customer willingness to purchase grocery online from local
retailers.
A detailed report on ONE PLUS (more specifically One Plus 3, and how it was a game changer for them). This report covers from their start till recent developments on One Plus 6, analyzing various aspects of research and development. The report consists of the following sections: Initial Marketing Strategy used, Macro Analysis, Legal Analysis, Economic Analysis, Socia-Cultural Analysis, Technological Analysis, Environmental Analysis, Micro Analysis, Target Market, Distribution Channel, Suppliers, Competitors, Customers, Current Target & Marketing Mix, SWOT analysis and Recommendations.
Ground Zero 4.0 | Scaling Up - Event ReportRedSeer
Executive Summary
The report is compiled of all the topics that were discussed at Ground Zero 4.0 and has been
segregated based on RedSeer’s research and panel inputs.
Key Findings:
1. Digital India
2. Retail
3. D2C
4. Education
5. Healthcare
6. Grocery
7. Etailing
Flipkart-Walmart deal has been a landmark moment in the history of e-tailing. Since its humble beginnings in 2000, e-tailing
has come a long way. The growth story of the industry in the last 10 years has been nothing less than remarkable. While the growth had slowed down between 2014-
2016 due to multiple factors like DIPP regulations and demonetization, 2017 has seen a turnaround for the industry.
Flipkart-Walmart deal has been a landmark moment in the history of e-tailing. Since its humble beginnings in 2000, e-tailing has come a long way. The growth story of the industry in the last 10 years has been nothing less than remarkable. While the growth had slowed down between 2014-2016 due to multiple factors like DIPP regulations and demonetization, 2017 has seen a turnaround for the industry.
India continues to shine as one of the beacons of growth in the world economy. Performance on key fundamentals remains robust, with strong GDP growth and sustained FDI inflows driving the economy and driving up the optimism in the stock markets
Indian FMCG Industry Presentation
Introduction & Market overview
Features of FMCG industry
Policies and Regulatory Framework
Market Drivers
Market Strategies
Market Challenges
Major FMCG companies in India
Major trends
I have done my project of Godrej expert of FMCG industry. its gives lots of knowledge during the making my project and understand the industry or profile.
Retail Marketing in Rural India – Factors in Favour and StrategiesDr. Amarjeet Singh
Retail industry now accounting for 10% of the
country’s GDP undergoes dynamic changes boosting its
growth still further. The sector grows impressively leading
to production of wide range of products and services.
Rural markets provide great scope for marketers due to
increased revenue and purchase power of the rural
population in India. The rural income is expected to
increase faster due to government policies supporting
agriculture and the earning population that has
temporarily moved out of rural villages to cities for
employment in non-agricultural sectors. Technology in
agriculture has helped to produce quality crops and the
market is ready to give high prices for such products.
Around 60% of the students in the colleges are first
generation graduates who have moved out of their villages
for tertiary education. Thus the life style, likes and
preferences of the rural population keeps changing.
However the huge rural segment is much different from
that of the urban segment and the marketers need to
approach with sustained efforts and special models. The
highly fragmented rural segment’s needs are majorly filled
by unorganized family run Kirana stores and Maligai
shops. The share of organised retail in the country has
risen by 60% and the same is expected to have impact on
the rural market as well. The paper focuses on the growth
of retail market in India, the emerging factors in favour of
rural retail and suggests strategies for rural retailing.
The report *State of D2C in India: A Logistics Update* talks about the evolving dynamics of the d2C landscape with a particular focus on how brands navigate the complexities of logistics. Third Party Logistics enablers emerge indispensable partners in facilitating the growth journey of D2C brands, offering cost-effective solutions tailored to their specific needs. As D2C brands continue to expand, they encounter heightened operational complexities with logistics standing out as a significant challenge. Logistics not only represents a substantial cost component for the brands but also directly influences the customer experience. Establishing efficient logistics operations while keeping costs low is therefore a crucial objective for brands. The report highlights how 3PLs are meeting the rising demands of D2C brands, supporting their expansion both online and offline, and paving the way for sustainable, scalable growth in this fast-paced market.
In “Decoding Omnichannel,” the report delves into the intricacies of this retail revolution, drawing insights from trailblazing companies like Caratlane, Lenskart, and Mamaearth. By offering actionable strategies and insights, we aim to empower entrepreneurs and brands to navigate this dynamic landscape with confidence. As India’s retail market hurtles towards a projected $2.2 trillion by 2030, the convergence of offline and online influences presents a transformative opportunity for consumer engagement. Embracing this fusion not only as a necessity but as a strategic imperative, businesses can position themselves at the forefront of innovation, driving sustainable growth and resonating deeply with the diverse needs of the Indian consumer
For an in-depth exploration, download the full report now!
MENA e-commerce: A unique ecosystem, in a period of transitionRedSeer
Amidst the turbulence of the pandemic, the digital economy surged globally, but nowhere more profoundly than in the MENA region. This is because we were still in the period of customer acquisition where the marketing spends are extremely high. The pandemic helped leapfrog these days, placing our region on a pedestal of growth.
Now, as we enter a post pandemic era, where the only constant is change, it is important to acknowledge some unique aspects of our digital economy that make it one of the most attractive ones globally.
The MENA Digital Economy has been a silver lining amidst a global funding slowdown and is aided by strong consumer confidence. There are various emerging micro trends that hold the potential to redefine its landscape. For brands and retailers, the challenge lies in discerning and prioritizing the trends that not only address genuine customer needs but also align with sound business logic despite associated costs. At the heart of this evolution is personalization, where artificial intelligence stands poised to play a pivotal role.
In the report, we have also highlighted five overarching consumer trends which need to be kept in mind to emerge on the right side of the next period of growth for our digital economy.
KSA food aggregators to deliver million smilesRedSeer
The food service sector in Saudi Arabia is currently a massive SAR 100 Bn market that has displayed resilience and rebounded swiftly. The market witnessed a covid-led decline because of reduced mobility/ operational hours and restaurant closures. During this time, an emerging trend of in-home consumption emerged which created a unique opportunity for food delivery players to capitalize on.
Currently, the food delivery market in KSA is experiencing rapid growth, driven by high consumer satisfaction and Net Promoter Scores (NPS) for food aggregators in the region. This growth is driven by evolving consumer preferences, as there is a notable transition towards prioritizing convenience over mere affordability, especially after the pandemic.The market is currently dominated by two key players: Hungerstation and Jahez, collectively responsible for ~70% of the food aggregator market. The emergence of new players in the market underscores its vast potential and the expanding addressable market. Despite being new, players like Noon Food and Ninja warrant close attention to the market’s future growth potential.
Food aggregators market is projected to reach 1 million daily touchpoints by 2024, providing numerous opportunities to offer multiple services, including q-commerce, SaaS, dark store, and dark kitchen models. This can also enable a favorable environment for super apps and super brands to co-exist.
The narrative of India's digital advertising market unfolds amid a decade of digital transformation, propelled by the surge in smart devices and widespread internet access. This era witnessed remarkable increases in user engagement across various platforms, fueling unprecedented growth in digital advertising spend. Despite the challenges posed by COVID-19, which initially drove a surge in online activity, the subsequent stabilization and muted growth in digital advertising spend during FY23-24 were influenced by consumption slowdown, regulatory changes, and a funding lag. Nevertheless, the trajectory remains striking, with digital advertising expenditure outpacing traditional media, commanding a market share of approximately 55% by FY24.
To learn more about this dynamic landscape, download the report now.
KSA’s economy has witnessed the fastest GDP growth rate during 2021-22 period, driven by pro-business reforms and rising oil prices. Continuous improvement in ease of doing business, social and economic liberalization and initiatives to attract talent and global businesses will pave the way for future growth.
KSA has a thriving tech enabler ecosystem with a home to 60+ fintech startups and over 10 Mn IoT connections, actively participating in emerging digital technologies. Within KSA, despite the rapidly evolving digital landscape, there are numerous sectors that still hold vast untapped potential and significant opportunities for growth. This underscores the necessity for robust, localized businesses to confront region-specific challenges. With its impressive spending capacity, well-established infrastructure, and unwavering government backing, the KSA offers an ideal groundwork for developing and implementing effective solutions tailored to the unique needs of the region.
KSA ecosystem is vibrant with a balance between local talent, government support, international investors and partnerships. Its digital economy is poised to be a major driver of diversification, providing a ~25% boost to GDP growth. It is expected to emerge as the mecca of unicorns in the MENA.
Saudi Arabia's Rise to Global Entertainment DominanceRedSeer
n the aftermath of the global pandemic, the Kingdom of Saudi Arabia (KSA) is experiencing a remarkable transformation across various facets of society. Swift advancements in social, economic, and cultural realms underscore Saudi Arabia’s aspiration to become the hub of the region and the world. This transformative phase is driven by a growing acceptance of diverse entertainment formats such as movies, concerts, and various leisure and entertainment avenues. Key to this paradigm shift are government initiatives that are actively promoting a culture of leisure and entertainment in the country.
Ear-It-All: The booming world of audio seriesRedSeer
The Media & Entertainment (M&E) sector stands as a cornerstone of online content consumption, serving billions of internet users worldwide. Acting as a gateway to the digital economy, M&E has seen significant evolution over the years. While Social Media and Video Streaming have reached maturity, Audio Streaming, particularly Audio Series, emerges as a promising frontier in entertainment innovation. Mirroring the appeal of Video Series, Audio Series offer immersive content experiences, accessible anytime and anywhere, catering to the diverse entertainment needs of internet consumers. With approximately 1.3 billion potential users globally, the Audio Series market represented a lucrative US$ 21-25 billion opportunity in 2023, poised to double by 2027. Leading players in the entertainment industry are tapping into creator communities to drive content creation, while established platforms are exploring Audio Series offerings to broaden their market reach.
Winning Recipe for Food Brands in India- Redseer ReportRedSeer
The Indian organized food services market is projected to exceed $100 billion by 2028, growing at a CAGR of 8–12%. This growth, driven by evolving consumer behavior, is expected to double the market from $30 billion to $60 billion. To capitalize on the heterogenous nature of the market, brands are urged to embrace diverse cuisines. The House of Brands (HoBs) strategy emerges as a fitting approach, with an average HoBs revenue at least 5 times higher than that of a standalone brand. Successful implementation of the HoBs model hinges on the ability to build and scale multiple brands while ensuring operational excellence.
For an in-depth exploration, download the full report now!
Study reveals udaan winning on customer service excellence, after market cons...RedSeer
In a recent study conducted by Redseer Strategy Consultants (Redseer), India’s largest and renowned strategy consultancy firm with a global footprint and Udaan – India’s major eB2B player, delves deep into the eB2B market, offering key insights and strategic approach aimed at unlocking unparalleled growth opportunities for businesses operating in the segment.
The comprehensive analysis and in-depth market research reveal that udaan, India’s largest eB2B player, has emerged as a leader in customer service excellence following a phase of market consolidation. The focus on customer service excellence, especially after a period of market consolidation, indicates a strategic approach to stand out in a more concentrated and competitive market.
Over the past several years, India has embarked on a remarkable journey towards becoming a digitally enabled society. This digital transformation has not only reshaped the nation's socioeconomic landscape but also served as a global model for how technology can be harnessed to uplift and connect diverse and large populations.
At the heart of this transformation lies the concept of Digital Public Infrastructure (DPI), a strategic framework that has provided the rails to propel India onto the global stage as a digital powerhouse.
With the Indian internet economy projected to reach USD 1 trillion by 2030, DPIs are primed to continue playing a significant role in democratizing this growth and ensuring a digital future that is inclusive and expansive.
Unlock the comprehensive report, "Beauty Unveiled: Decoding the Success of Pure-Play Beauty Companies," co-authored by Peak XV and Redseer Strategy Consultants, to gain deeper insights into the success drivers of leading BPC players on both global and Indian fronts.
The fusion of shopping and social media is reshaping consumer behavior and advertising strategies, offering a potential windfall of over $10 billion for those who seize the moment.
The "India Digital SME Credit Report 2023," a collaboration between GetVantage and Redseer Strategy Consultants, reveals that a significant credit deficit of approximately $220 billion is impeding the economic progress of digitized businesses. Despite an infusion of $53 billion in FY22 and an estimated $165 billion being serviceable after accounting for unviable businesses, the current working capital deficit remains at $112 billion. The report predicts that the demand for credit will surpass $570 billion in the next five years as the number of digital SMEs doubles. This deficit hampers innovation, job creation, scaling, and efficiency building among new-economy businesses. The report underscores the crucial role of alternative financing platforms, such as revenue-based financing, in addressing this gap and fostering economic growth.
The report discusses the significance of mass consumers in the Indian retail and eCommerce industry. Mass consumers, earning between INR 2.5-10 lakhs annually, are a prominent consumer group projected to drive a substantial portion of eCommerce growth. They are increasingly shopping online, value-conscious, and comfortable with technology. The report highlights their potential as a US$ 1.3 Tn opportunity for brands, with online wallet share expansion being a key theme. Decision drivers include pricing, product quality, and trust in the platform. Successful business models targeting this segment have emerged both in eCommerce and offline retail. Overall, mass consumers are poised to shape the future of Indian retail, making them highly attractive to businesses and eCommerce platforms.
Dive into our comprehensive report that explores the dynamic transformation of India's economy, driven by the rapid formalization and digitalization of Micro, Small, and Medium Enterprises (MSMEs). Discover how these nimble businesses are leveraging the digital landscape to amplify their reach, reshape industries, and contribute significantly to India's economic growth story.
Redseer unlocking value of mass consumer PR Report.pdfRedSeer
The report discusses the significance of mass consumers in the Indian retail and eCommerce industry. Mass consumers, earning between INR 2.5-10 lakhs annually, are a prominent consumer group projected to drive a substantial portion of eCommerce growth. They are increasingly shopping online, value-conscious, and comfortable with technology. The report highlights their potential as a US$ 1.3 Tn opportunity for brands, with online wallet share expansion being a key theme. Decision drivers include pricing, product quality, and trust in the platform. Successful business models targeting this segment have emerged both in eCommerce and offline retail. Overall, mass consumers are poised to shape the future of Indian retail, making them highly attractive to businesses and eCommerce platforms.
According to a report released by strategy consulting firm Redseer Strategy Consultants in collaboration with Plural by Pine labs, 85% of the businesses in India will be digitally enabled by FY26. From bustling cities to remote villages, digital payments are on the fast track to change the way users transact. Penetration of smartphones and the internet, and favorable government policies have been key drivers in the adoption of digital payments in the country. With more than 70 crore internet users, India has the second-highest number of internet users in the world, trailing only behind China. With a population of 140 Cr, India is poised to become a global leader in digital payments in the coming years.
1.Wireless Communication System_Wireless communication is a broad term that i...JeyaPerumal1
Wireless communication involves the transmission of information over a distance without the help of wires, cables or any other forms of electrical conductors.
Wireless communication is a broad term that incorporates all procedures and forms of connecting and communicating between two or more devices using a wireless signal through wireless communication technologies and devices.
Features of Wireless Communication
The evolution of wireless technology has brought many advancements with its effective features.
The transmitted distance can be anywhere between a few meters (for example, a television's remote control) and thousands of kilometers (for example, radio communication).
Wireless communication can be used for cellular telephony, wireless access to the internet, wireless home networking, and so on.
Bridging the Digital Gap Brad Spiegel Macon, GA Initiative.pptxBrad Spiegel Macon GA
Brad Spiegel Macon GA’s journey exemplifies the profound impact that one individual can have on their community. Through his unwavering dedication to digital inclusion, he’s not only bridging the gap in Macon but also setting an example for others to follow.
# Internet Security: Safeguarding Your Digital World
In the contemporary digital age, the internet is a cornerstone of our daily lives. It connects us to vast amounts of information, provides platforms for communication, enables commerce, and offers endless entertainment. However, with these conveniences come significant security challenges. Internet security is essential to protect our digital identities, sensitive data, and overall online experience. This comprehensive guide explores the multifaceted world of internet security, providing insights into its importance, common threats, and effective strategies to safeguard your digital world.
## Understanding Internet Security
Internet security encompasses the measures and protocols used to protect information, devices, and networks from unauthorized access, attacks, and damage. It involves a wide range of practices designed to safeguard data confidentiality, integrity, and availability. Effective internet security is crucial for individuals, businesses, and governments alike, as cyber threats continue to evolve in complexity and scale.
### Key Components of Internet Security
1. **Confidentiality**: Ensuring that information is accessible only to those authorized to access it.
2. **Integrity**: Protecting information from being altered or tampered with by unauthorized parties.
3. **Availability**: Ensuring that authorized users have reliable access to information and resources when needed.
## Common Internet Security Threats
Cyber threats are numerous and constantly evolving. Understanding these threats is the first step in protecting against them. Some of the most common internet security threats include:
### Malware
Malware, or malicious software, is designed to harm, exploit, or otherwise compromise a device, network, or service. Common types of malware include:
- **Viruses**: Programs that attach themselves to legitimate software and replicate, spreading to other programs and files.
- **Worms**: Standalone malware that replicates itself to spread to other computers.
- **Trojan Horses**: Malicious software disguised as legitimate software.
- **Ransomware**: Malware that encrypts a user's files and demands a ransom for the decryption key.
- **Spyware**: Software that secretly monitors and collects user information.
### Phishing
Phishing is a social engineering attack that aims to steal sensitive information such as usernames, passwords, and credit card details. Attackers often masquerade as trusted entities in email or other communication channels, tricking victims into providing their information.
### Man-in-the-Middle (MitM) Attacks
MitM attacks occur when an attacker intercepts and potentially alters communication between two parties without their knowledge. This can lead to the unauthorized acquisition of sensitive information.
### Denial-of-Service (DoS) and Distributed Denial-of-Service (DDoS) Attacks
This 7-second Brain Wave Ritual Attracts Money To You.!nirahealhty
Discover the power of a simple 7-second brain wave ritual that can attract wealth and abundance into your life. By tapping into specific brain frequencies, this technique helps you manifest financial success effortlessly. Ready to transform your financial future? Try this powerful ritual and start attracting money today!
APNIC Foundation, presented by Ellisha Heppner at the PNG DNS Forum 2024APNIC
Ellisha Heppner, Grant Management Lead, presented an update on APNIC Foundation to the PNG DNS Forum held from 6 to 10 May, 2024 in Port Moresby, Papua New Guinea.
Multi-cluster Kubernetes Networking- Patterns, Projects and GuidelinesSanjeev Rampal
Talk presented at Kubernetes Community Day, New York, May 2024.
Technical summary of Multi-Cluster Kubernetes Networking architectures with focus on 4 key topics.
1) Key patterns for Multi-cluster architectures
2) Architectural comparison of several OSS/ CNCF projects to address these patterns
3) Evolution trends for the APIs of these projects
4) Some design recommendations & guidelines for adopting/ deploying these solutions.
2. Indian eGrocery - A promising opportunity led by value-first users
Page - 2
Indian
eGrocery
About Us
A promising opportunity led by
value-first users
RedSeer is a leader in the Internet and new age advisory.
Over the last 11 years of its operations we have advised
200+ clients across the breadth of Internet and investment
industry in India, Middle East and South East Asia. Our
advisory is differentiated through our high-quality IP of
market insights and research, which is unparalleled in
industry and helps both corporate and funds make right
choices. With more then 200 consultants across 5 offices,
we have emerged as the largest home-grown regional
consulting firm in India.
4. Indian eGrocery - A promising opportunity led by value-first users
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Preface
Last few years, all of us have seen how technology has
changed millions of lives in this country. Today for a lot of
us, it is all about clicking a button on our smartphone apps,
and enjoying on-door delivery of various products and
services. The use case which initially started from e-Tailing
of books (or booking tickets on IRCTC even earlier),
has now diversified into almost all utility products and
services, with the Indian internet consumer emerging out
as a clear winner. And the suppliers / providers are finding
it merrier too, through direct reach to the end consumers
through internet.
The ~$600 Bn grocery industry in India is undergoing
a similar disruption enabled by eGrocery platforms,
that have done a tremendous job in transforming how
people shop for their groceries. While these platforms
have solved for a number of consumer needs ranging
from improved access to higher convenience, the largest
challenge still faced by an average Indian is around
affordability and eGrocery platforms have the potential to
effectively resolve this aspect.
This provides a highly attractive opportunity for the
eGrocery sector, which we term as the ‘value-first
opportunity’, referring to the segment of households
for whom buying affordable groceries is of the utmost
important and everything else is secondary. The
value-first prospect is appealing because of not just its
large size, but also the associated unit economics that
are very favourable. Moreover, it requires to be served
in a focused fashion, because of the specific needs that
value-first households have. eGrocery platforms that
will be able to win this exciting segment, are likely to be
sustainable in the long run.
5. Indian eGrocery - A promising opportunity led by value-first users
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Table of Content
Indian
eGrocery
A promising
opportunity led by
value-first users
Indian Grocery -
$850 Bn+ market
(2025) up for digital
disruption
eGrocery
addressable
market – a huge
opportunity led
by value-first
households
The key to serve
the value-first
opportunity
through eGrocery
1
2
3
6
22
33
6. Indian eGrocery - A promising opportunity led by value-first users
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1
IndianGrocery-
$850Bn+market
(2025)upfordigital
disruption
7. Indian eGrocery - A promising opportunity led by value-first users
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GroceryinIndia-
AnenormousKirana-led
opportunity!
—
basics like non-meat fresh
and staples cover almost
80% of the grocery spend
in India
This is considerably higher than the developed countries
like the US, the UK and China, where grocery spend as a %
of retail, is in the 30-40% range. The nascency of the market
gets further established by looking at the kind of grocery
categories purchased in India vs the developed economies –
basics like non-meat fresh and staples cover almost 80% of
the grocery spend in India, compared to 30-45% coverage in
the US, the UK and China.
Indian consumers are heavily focused on meeting their basic
needs of ‘roti-kapda-makan’ – a Hindi slang meaning, food,
clothing and shelter, of which food is the most essential
component.
This is evident from groceries accounting for a significant
66% of the total retail spend in India, which translated into a
huge $600 Bn+ market in 2019.
Grocery centric retail in India
8. Indian eGrocery - A promising opportunity led by value-first users
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As a result of COVID, the grocery market saw ~5% dip in
2020, led by reduction in overall consumption and supply
chain disruptions during the lockdown period. Being an
essential category, grocery was the least affected retail
category due to COVID lockdown.
It is now projected to grow at a healthy 8% CAGR and
become a humungous ~$850 Bn+ opportunity by 2025.
Consumer’s willingness and ability to pay premium for
superior quality products, rise of easy-to-cook foods and
at-home delivery, demand for healthy & nutritional F&B
and consumption of newer food items adopted via global
experiences, are some of the primary drivers of the sector’s
growth in the years to come.
India Grocery Market Size & Growth
USD Bn
Increasing willingness &
ability to pay premium for
superior quality products
Growing market for
easy-to-cook foods
and at-home delivery,
driven by increasing
requirement of convenient
& hassle-free experience
Demand for healthy
and nutritional food &
beverages, led by stronger
focus on healthy lifestyles
& fitness
Rising consumption of
newer items through
global experiences
(e.g. meat, cereals with
breakfast, beverages
with meal etc.)
Growth Drivers
442 603 573 852
2016 2019 2020F 2025F
8%
5%
11%
The grocery market saw led by
the reduction in overall
spending due to COVID
Grocery Spend
Per Capita (USD) 334 446 419 600
As % of GDP 19.1% 19.9% 21.0% 23.0%
As % of retail 67.4% 66.5% 73.4% 65.3%
66.5%
oftheretailspendin
Indiaisfocusedon
groceries.
9. Indian eGrocery - A promising opportunity led by value-first users
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Kiranas (unorganized local grocery stores) are the lifeline of
groceries in India, accounting for more than 95% of the total
grocery spend. They ride on their solid ability to provide a
convenient and localized service to consumers (with support
from suppliers and regulators), primarily in Tier 2+ cities that
account for almost 80% of the grocery spend in India. Of 11
Mn total Kiranas in India, 8 Mn+ are present in Tier 2+ cities.
Organized B&M drove the first wave of disruption in the
traditional grocery space, with most presence in metro and
tier 1 cities. However, it has had very limited penetration in
the India grocery market because of multiple operational
such as high operating costs, lack of skilled manpower and
regional / local limitations. As a result, organized B&M
accounted for only 5% of the grocery spend in 2019.
A market led by Kiranas, with limited play for
organized B&M
95%
of grocerymarketin
Indiaisledbylocal
kiranastores
India grocery spend – by retail channel
USD Bn
Unorganized play– global benchmarking
CAGR
(2016-19)
603
442
Unorganized
(Kirana-led)
Organized B&M
Online
96.5%
94.9%
~55%
~25%
~10%
2019
2016
3.4%
0.1%
4.8%
0.3%
Country 2019 Unorganized
Share %
95%
43%
6%
8%
The unorganized (Kirana-led) grocery play in India is significantly higher
than developed markets. While China sits at 43%, the US and the UK
have only 6% and 8% unorganized grocery market.
10. Indian eGrocery - A promising opportunity led by value-first users
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12-15%
marginleakageatlocalKirana
level,leadingtohigherprice
fortheendconsumer
Unorganizedmarketsuffering
fromaffordabilityissues
Due to the heavily unorganized space, the grocery supply chain in India is very fragmented, wherein different supply chain
models exist for different types of cities. This becomes further complicated as you move from urban to rural markets,
because of presence of multiple unorganized intermediaries.
As a result of this, significant margin leakage happens at the
level of each intermediary, before grocery products reach
the end consumer. Specifically for local Kiranas that account
for 95% of the market, the margin leakage is as high as
12-15%. This leads to higher costs of products for the Indian
consumers, making affordability a considerable challenge in
the Indian market.
The fragmented grocery supply chain
Grocery supply chain
C&FA
(2-3%)
(2-5%)
Grocery
Consumers
Route 1
Route 2
Route 3
Route 4
Route 5
Route 6
Naonal Modern
Trade Chains
Regional certain
Naonal MT outlets
GT retailers, typically
er 1+ cies
GT retailers,
typically er 1+
cies
Manufactur-
ing Unit
(In-house or
3rd
Party
owned)
MT
Distribuon
Centre
(2-5%) (2-3%)
MT
Distribuon
Centre
Typically er 2+
cies
Typically er 2+
cies
Super-Stockist
Super-Stockist
Super-Stockist
(7-10%)
Distributor
(7-10%)
Distributor
(7-10%)
Distributor
(2-5%)
(12-15%)
Wholesaler
GT
Retailers
(Kiranas)
(7-10%)
Distributor
(22-25%)
MT
Retailers
11. Indian eGrocery - A promising opportunity led by value-first users
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Conversion Rate – US $1= INR 73.44, UK £1 = INR 99.66
FMCG Cost Benchmarks: India vs Developed Markets
Illustrative SKU prices
Dec ’20
The affordability challenge in India gets established by
running a quick comparison of costs of global FMCG
products, between India and other developed countries.
The results attest the fact that consumers in India pay much
higher for grocery products, than those in the US or the UK,
because of the unorganized and fragmented grocery market.
The problem gets further pronounced in India, because of
the relatively low purchasing power – another reason why
the grocery spend is more focused on the basic categories
like staples and non-meat fresh.
INR 465
INR 466
INR 433
INR 420
INR 518
INR 302
INR 507
US UK India
INR 294
INR 130
INR 525
INR 299
INR 125
INR 514
INR 128
INR 498
Airwick
Freshmac
Automac Air
Freshener
Complete Kit
Hershey's
Spreads Cocoa
623 ml
Bey Crocker
Cake Mix,
Choco Fudge
Rich Chocolate
500gm
Monster
Energy Drink
gy Drink
gy
500ml
Horlicks
Mother's Plus
Vanilla R
Vanilla R
V efill,
500 g
12. Indian eGrocery - A promising opportunity led by value-first users
Page - 12
(x1-x2%) represents the range of margins for the
respective intermediary
Note(s): 1. Variable depending on the platform / business model
eGrocery–ignitingdigital
disruptioninthegroceryspace
Resolving consumer pain points through a simpler
supply chain
Online grocery supply chain
Digital grocery platforms are now disrupting the grocery space in India. Operating on a simplified supply chain and a
tech-enabled retail layer, eGrocery platforms have been able to positively transform the consumer’s grocery shopping
experience. At the same time, they’ve played an instrumental role in expanding the supplier / brand reach across consumers.
Consumer
CFA
Advantages:
Higher ability to provide better prices
to end consumers
Better availability fill rates
Stronger quality control
Benefits for manufacturers (wider
consumer reach, better margins etc.)
Most metros and er
1+ cies
Manufacturing
Unit ( In-house or
3rd Party owned)
eGrocery
Warehouse/Delivery
Centre
Route 2 : eB2C:
2-3%
6-22%(1)
eGrocery
Warehouse/Delivery
Centre
6-22%(1)
eGrocery
Warehouse/Delivery
Centre
6-22%(1)
Super- Stockist
2-5%
Most metros and
er 1+ cies
Route 3: eB2C:
Tier2+ cies
Route 3: eB2C:
13. Indian eGrocery - A promising opportunity led by value-first users
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High prices / Limited
discounts
Variety of platform discounts,
coupons cashback offers
Limited assortment
Wide variety of products /
SKUs onboarded on eGrocery
platforms
Poor product quality
Strong quality control, along
with tie ups with trusted FMCG
brands Pvt. Labels
Inconvenience
Online purchase with at-home
delivery enabled by different
models as per need
Unavailability of desired
products
Better fill rates through simpler
supply chain logistics
Poor after-purchase
service (complaints, returns
/ exchange etc.)
Standard customer support
complaint resolution return /
exchange processes
Pain-points resolved by eGrocery platforms
eGrocery platforms are resolving almost all the pain points
that Indian consumers faced with offline channels, including
both – local Kiranas and organized BM. For example,
they are appropriately addressing the affordability issue by
reducing the margin leakage in the grocery supply chain and
passing it on to the consumers. This empowers the eGrocery
platforms to sell products at a lower cost. In addition, they
are solving for the inconvenience and low fill rates associated
with offline shopping, by providing doorstep deliveries and
creating their own wide range of products, brands and SKUs
respectively.
14. Indian eGrocery - A promising opportunity led by value-first users
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Verticals
Online grocery specialists
Super-verticals
Online grocery verticals focused
on a particular category like meat
Horizontals
General online retailers providing
eGrocery services
Hyperlocals
Hyperlocal delivery platforms
providing eGrocery services
Micro-delivery
verticals
Online grocery verticals focused
on early morning delivery
Indian eGrocery Business Models
Multiple platforms are disrupting this emerging space with
innovative business models. While on one hand there are
eGrocery verticals that specialize in the online grocery space
and have created solid service standards in the industry,
on the other hand there are large e-tailing horizontals, who
have launched grocery as one of the categories on their
e-commerce platforms. Similarly, there are online platforms
specializing in early morning grocery delivery, fresh meat
delivery and hyperlocal (connecting consumers to local
grocery stores) delivery.
Disruption by innovative eGrocery models
15. Indian eGrocery - A promising opportunity led by value-first users
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eGroceryonapromisinggrowth
trajectory,withasignificant
headroom
Experiencing healthy growth in the last few years
eGrocery platforms’ strong ability to solve for the critical consumer need gaps through innovative business models, has
enabled the sector to grow at a solid 60% CAGR over the last 3 years and reach $1.9 Bn GMV in 2019.
India eGrocery Market GMV
USD Bn
0.5
0.7
1.2
1.9
2016 2017 2018 2019
~60%
CAGR
In these 3 years, each business model played a unique
role in taking the space forward. For example, while
on one hand, verticals (online grocery specialists)
dominated the space for the most part and expanded
their reach beyond 25-30 cities, on the other hand,
horizontals realized the importance of specialization in
the grocery space and launched their grocery-focused
e-marketplaces. Moreover, fresh meat delivery,
early morning delivery and hyperlocals, also rose to
the occasion to meet the evolved metro consumer
demands.
16. Indian eGrocery - A promising opportunity led by value-first users
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10:12
DELIVERY
BUY NOW
Key market disruptions (2016 – 2019):
Verticals (Grofers, BigBasket) dominated the market and
expanded beyond metros to reach 25-30 cities
E-tailing horizontals (Amazon , Flipkart) entered the space
and launched their specialized grocery marketplaces (AZ
Pantry, FK Supermart)
Online meat ordering emerged as a separate super-vertical
with brands like Licious and Fresh2Home entering the space
with high quality meat offerings
Demand for micro-deliveries (early morning daily essentials)
shot up in metro apartments, with MilkBasket, Supr Daily
and BB Daily seeing increased subscriptions in metros
Hyperlocal marketplace models such as Dunzo and Swiggy
Stores re-emerged and found decent adoption in the market
in metros
17. Indian eGrocery - A promising opportunity led by value-first users
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Large headroom to penetrate further
On benchmarking the eGrocery penetration with the developed countries, it get established that the eGrocery
market in India is at a nascent stage and has an attractive path ahead. Compared to the negligible 0.3%
penetration in India, the US, the UK and China sit at healthy 8%, 4% and 6% penetration respectively.
Despite the healthy growth, eGrocery penetration in the
grocery market in India was very limited in 2019.
India Grocery – Split by Different Channels (2019)
USD Bn
Offline-only
(non-digital Kiranas)
eGrocery Organised BM Total Grocery Market
Penetration of overall
grocery spend
572 603
1.9
29
x%
100%
4.8%
0.3%
94.9%
18. Indian eGrocery - A promising opportunity led by value-first users
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It is well known that the pandemic has shaken the economies
and the human race across the world, including India.
However, it acted as a boon for the e-commerce sector,
led by the e-commerce platforms’ ability to safely provide
the products / services at-home. As a result, eGrocery, an
essential-focused e-commerce, benefited considerably from
the pandemic in India.
During the challenging COVID lockdown period
(April-June’20), Indian consumers organically resorted
to ordering groceries online, led by the safe hygienic
purchase experience provided by eGrocery platforms
during the difficult times. To effectively support the surge in
demand, multiple new players entered the eGrocery space
during the lockdown (e.g. JioMart launched eGrocery in
May’20) and a few others expanded their services to more
number of cities, including T2+ geographies (e.g. Amazon
Pantry expended to 300+ cities in June). Driven by the same,
the market reached 1.6x of the Jan’20 GMV in June. Post
the lockdown, the Grocery sector was able to sustain the
surge for the remaining year and exited 2020 at almost 2x of
Jan’20 GMV.
eGrocery market trend – 2020
GMV, Jan’20 indexed at 100 points
eGrocery
market
GMV
Jan Feb Mar Apr May Jul Sep Nov Dec
Oct
Aug
Jun
100
82
163
209
252
199
$ 0.17 Bn
$ 0.37 Bn
Pre-COVID
(As expected)
COVID Lockdown
(Solid adoption led by provision of
safe hygienic experience)
Post Lockdown
(Retaining the surge)
Year-end
(Festive sale effects)
The sector sustained the COVID
surge in the year-end and had an
oscillatory performance, because
of variations in horizontal business
due to festive sale
Growth maintained post lockdown,
with most leading platforms seeing
significant growth in business
Consistent growth from Apr to Jun, led
by organic adoption by consumers
during COVID. This was supported
from the supply side by the entry of
multiple new players in the market
(incl.JioMart) and expansion of
coverage to T2+ cities.
Dropped to 80% of Jan GMV
in Apr, because of supply
chain disruptions
Expected drop in Feb
because of shorter month
stock-ups in Jan sales
COVID-19: The blessing in disguise for eGrocery
19. Indian eGrocery - A promising opportunity led by value-first users
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To summarize, the eGrocery sector was performing fairly
well in the pre-COVID era. eGrocery platforms were able
to significantly transform the consumer’s grocery shopping
experience, evident from the high online vs offline NPS.
Moreover, with rising internet penetration and more
consumers transacting online, willingness awareness
towards online shopping (including grocery) was becoming
positive. This was well supported by the readiness of brands
to partner with eGrocery platforms and the confidence
of leading investors on the eGrocery sectors (~$600 Mn
funding for the sector in 2019).
eGrocery Market – Growth Factors Pre-COVID Growth Factors
High user
satisfaction:
33% NPS of the online grocery
channel vs 26% NPS of the offline
grocery channel
Increasing base of
online transacting
users:
500 Mn+ users expected to
transact online by 2025
Consistent influx of
investments:
~600 Mn sector funding in 2019
i.e. 2x of that in 2015
Brand readiness
to partner with
eGrocery apps:
Ability to widen user reach and
SKU performance tracking
Rising Demand for
Convenience
Increasing urbanisation
disposable income leading to
need for hassle-free experience.
On an accelerated growth path post COVID
20. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery Market – Growth Factors Post COVID Growth Factors
Expansion to Tier
2+ geographies:
Entry of Tier 2+ focused models
and expansion of existing models
in T2+ geos
Rise of online
hyperlocals:
Increased adoption of hyperlocal
models, owing to its value of
providing faster access
These factors have become more pronounced post COVID,
with a considerable positive shift in the consumer’s mindset
towards online shopping because of safety concerns,
specially in the case of grocery. This is because of a potential
long-term shift towards buying better quality / hygienic
products, wherein eGrocery platforms are trusted more
than the local stores. It has also led to the increase in
basket size and frequency of ordering on eGrocery apps
(in addition to the rise in new user base). Moreover, with
brand tie ups growing stronger, eGrocery expansion in
Tier 2+ geographies and rise of fast delivery hyperlocal
models, eGrocery sector has received a solid boost from the
pandemic and is likely to propel the sector to grow at a swift
pace in the coming years.
Demand for
packaged items:
eGrocery apps are better placed
in terms of hygiene packaging
vs local shops
Brand tie ups
growing stronger:
Brands are keen to reach the
customer directly through
eGrocery platforms
Shift in consumer
mindset:
Towards home groceries due to
safety concerns (70% higher GMV
in June vs Jan)
21. Indian eGrocery - A promising opportunity led by value-first users
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Driven by the multiplication effect of COVID on the pro-sector factors, the eGrocery market is projected to grow
at a solid 53% CAGR in the next 6 years, which is considerably faster than the offline grocery channels (both
Kirana and organized BM). This will enable the eGrocery market to reach ~$24 Bn GMV in 2025 and penetrate
almost 3% of the ~$850 Bn+ grocery space in India.
India Grocery – Split by Different Channels (2025F)
USD Bn
766
852
24
62
CAGR over 2019
100%
7%
14%
53%
5%
3%
90%
6%
X%
X%
Offline-only
(non-digital Kiranas)
eGrocery Organised BM Total Grocery Market
Penetration of overall
grocery spend
eGrocery is projected to penetrate 3% of the total grocery
opportunity in 2025, at a market size of ~$24 Bn
22. Indian eGrocery - A promising opportunity led by value-first users
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2
eGrocery
addressablemarket
–ahugeopportunity
ledbyvalue-first
households
23. Indian eGrocery - A promising opportunity led by value-first users
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9%
670
209
410
164
300
154
175
110
580
193
350
146
232
130
135
90
Users Households
CAGR (20-25)
4%
15%
9%
12%
8%
16%
8%
29%
18%
17%
12%
CAGR (19-20)
Internet Usage Funnel
Number of Users, Mn
Rapid growth in 2020, led
by internet adoption during COVID
35%
22%
19%
14%
420
233
603
240
720
255
1020
2025
2020
2019
210
Access to Internet
Total population with
access to internet
Active Internet Users
Uses social media, google,
but may not transact online
Online Shoppers
Atleast one transaction on
online retail platforms in a
year
Online Service Transactors
Transacts for services e.g.
banking/recharge, but may
not buy products
Anenormousaddressable
opportunity
The growing online transacting base
Almost 670 Mn people in India had internet access in 2020,
of which, more than 400 Mn people used internet platforms
actively (mostly social media and search engines). 75% of
the active internet users (i.e. 300 Mn users) are estimated
to have transacted online for services as well as products
last year, which translates into 154 Mn online transacting
households in India in 2020. Driven by the growing internet
penetration, this base of online transacting households is
likely to reach 233 Mn by 2025
154Mn
onlinetransacting
householdsinIndiain
2020.
24. Indian eGrocery - A promising opportunity led by value-first users
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The large addressable expanse for eGrocery
Of the
154 Mn
online
transacting
HHs in 2020
23 Mn
are projected to have used
eGrocery platforms at least
once
35 Mn
were aware of eGrocery, but
were unwilling to try eGrocery
due to strong habits of
purchasing groceries offline
41 Mn
were aware of eGrocery
and willing to try eGrocery
9 Mn
were unaware of eGrocery, but
were willing to try eGrocery
when informed about the
benefits of eGrocery platforms
22 Mn
were aware of eGrocery, but
were unwilling to try eGrocery
due to negative perception
24 Mn
were unaware of eGrocery
and were unwilling to try
eGrocery.
A D
B E
C F
Basis the above analysis, 130 Mn online transacting HHs
used eGrocery platforms or were aware of eGrocery
platforms or were willing to try eGrocery platforms in
2020. This adds up to a significant 130 Mn eGrocery
addressable households.
130Mn
eGroceryaddressable
householdsinIndiain
2020.
25. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery addressable Wallet (by city tier)
Addressable grocery wallet, USD Bn
Increasing penetration of online
grocery players in Tier 1
Tier 2+ cities, will enable higher
awareness in deeper areas
Rising internet penetration and
comfort with cashless transactions
will boost the willingness to try
eGrocery services
Positive experience with other
consumer internet services will
steer the habitual shift towards
at-home access of usual products
services
Marketing efforts and focused
messaging by online grocery
platforms will help in building a
positive perception of eGrocery
platforms
Growth Drivers
45%
39%
55%
61%
2020 2025F
Tier 2+
Metro/Tier 1
2x
growth
130
293
585
210
eGrocery
address-
able HHs:
Considering the annual grocery expenditure of the 130 Mn
eGrocery addressable households, eGrocery Currently
has a $293 Bn addressable wallet (as per 2020 estimates).
Led by the rising internet penetration comfort with
digital transactions in Tier 2+ geographies and increasing
awareness / willingness towards eGrocery platforms
(enabled by marketing efforts and positive experiences),
eGrocery addressable base is projected to reach 210 Mn
households in 2025, which will correspond to $585 Bn
addressable wallet. More than 60% of this addressable
opportunity is likely to be Tier 2+ focused.
26. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery Addressable HHs by Primary Need Gaps (2020)
Mn, % of addressable HHs
35%
21%
8%
19%
8%
7%
2%
Limited discounts High Pricing No returns
/exchange policy
Unavailability of
desired products
Crowded / long
waiting time
Limited options to
choose from
Poor product
quality
eGrocery Addressable
HHs
130
Convenience-first behavior was prominent among
the high-income HH groups (annual HH income
above USD 14k), whereas value-first behavior was
more prevalent across low-mid income groups
(annual HH income less than USD 14k)
Convenience-first Households
(Convenience-oriented need gaps)
Value-first Households
(Value-oriented need gaps)
36%
64%
Q. What are your key pain points with offline grocery purchase? Rate the severity of pain points on a scale of 1-5.
% Respondents (1st ranked pain point), N=2752
Thedominanceofvalue-first
householdsandtheirgrocery
purchasebehavior
Grocery purchase behavior: value-first and
convenience-first
Depending on the primary need gaps (as per the eGrocery
addressable households) associated with offline grocery
purchase, eGrocery addressable households can be
grouped into 2 parts: value-first and convenience-first.
While value-first households cite concerns related to high
pricing, limited discounts or returns / exchange policy
(which increases their unnecessary spend on groceries),
convenience-first households are more concerned about
availability of desired products at one place, crowded /
long waiting time, limited variety / assortment and product
quality.
27. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery Addressable Wallet by HH Group (2020)
USD Bn, % of addressable wallet
In India, a much larger quantum of the eGrocery addressable opportunity is led by value-first households. Almost 65% of the
130 Mn eGrocery addressable households are value-first, which cover ~61% of the huge $293 Bn addressable wallet. The
rest of the market is led by convenience-first households.
39%
61%
293
100%
2253 2179 2380
Convenience-first
Households
Value-first
Households
Lower grocery spend per HH for VF
HHs than CF HHs as most VF HHs
belong to low-mid income groups
130 Mn out of 300 Mn HHs in India (~43%)
account for ~50% of the overall grocery spend
(i.e. ~$293 Bn out of ~$580 Bn) in 2020
X% Avg. annual grocery
wallet (USD)
—
Almost 65% of the 130 Mn
eGrocery addressable households
are value-first in India
28. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery Household Segment Details
How is a value-first household different from a
convenience-first household?
The two types of households follow unique grocery
purchase behavior and priorities. On an average, a value-first
household has a lower income than the convenience-first
household, and hence can’t afford to prioritize the luxuries
of variety, exotic assortment and faster access. As a result,
a value-first household prioritizes buying the best-priced
products under discount options, cashback offers and sale
events, even if they’re getting a basic variety to choose from
or have a long wait time / inconvenient experience.
Avg. annual
household income
$7,000
1. Value-first Households
$16,000
2. Convenience-first Households
Key grocery
purchase priorities
1. Lowest prices
2. Discounts
3. Cashbacks / Offers
4. Sale events
1. Wide assortment /
Variety of options
2. Availability of
desired products in
one place
3. Emergency /
unplanned needs
(Top-ups)
5. Good returns /
exchange policy
6. Quality / hygiene
4. Low waiting time
5. Quality / hygiene
6. Exotic options
7. Customer support
service
Purchase
Behavior
“I buy groceries in bulk and at times defer
my grocery purchase, to get the best-priced
products.”
“Post one stock-up in a month or so, I prefer to
top-up my grocery basket as per the need and
hence purchase from places where I can get my
desired assortment, without much hassle.”
29. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery Addressable Wallet by Different Segments (2020)
GMV, USD Bn
Owing to the income differential, the value-first households have stronger presence in the deeper Tier 2+ geographies.
42%
51%
58%
49%
Tier 2+
Metro/T1
52%
47%
35%
32%
7%
12%
2% 5%
1% 1%
3% 3%
Personal
care
Home Care
Beverages
Packaged
Food
Staples
Fresh
43%
27%
42%
57%
15% 16%
Daily
Top-up
Non-daily
Top-up
Stock-up
The addressable market is centered around fresh staples
in India, given other categories have expensive products, and
hence become unaffordable for the consumers
Value-first Convenience-first
Value-first Convenience-first
Value-first
By Basket Type By Category
By City Tier
180 180 180
113 113 113
Convenience-first
Moreover, the stark difference in priorities of the two
types of households, reflects strongly in the purchase
behavior. The need for the best-priced products, pushes
the value-first households to plan their grocery purchase
and purchase groceries in bulk (as much as possible), unlike
convenience-first households, who have the luxury to
make more unplanned purchases. This is reflected in the
higher share of stock-ups for value-first households than
convenience-first households.
Secondly, the value-first households’ focus on basics is
evident from their grocery category split – while the Indian
market in general is fresh staples centric, the behavior
is more pronounced in case of value-first households,
who generally find the high-end packaged FB products
a bit unaffordable. On the other hand, convenience-first
households, spend relatively high on the non-basics like
packaged FB.
30. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery Household Segment – Key Value-first Profiles
Here’s a deeper look at the key value-first and convenience-first household profiles, that came across in our in-depth
discussions.
Note: 1. The above table Indicates core convenience-first personas, but is not exhaustive; 2. Represents age-group of HH member who makes the purchase decision
% Cohort
Age-group2
Annual HH Income
HH Size
Living setup
Cooking ownership
Pen portrait
50%
25-40
6-8 Lacs
3-5
Married couple with
young kids, with or
without parents
Self
“I am Sarita. I’m a housewife.
I stay in Indore with my
husband who works as a
salesman and two kids, who
study in school. My kids
love the food I cook, which
ensures that they eat fresh
healthy stuff. Moreover, I
love cooking their favorite
dishes trying out new
recipes. We buy grocery
from the modern store i.e.
10km away but has the best
offers on grocery. It is also
an enjoyable monthly family
outing. For unplanned needs
or weekly vegetables, we
rely on the nearest Kirana
shop.”
“I am Dinesh. I work in a
bank and stay with my wife
parents at my home in
Gorakhpur, where I’ve been
staying since my birth. I’ve
a son, who’s currently doing
B.Com. from Jaipur. My
wife teaches in a primary
school and cooks food for
the family as we’re used to
having food at home and it
is affordable as well. We’ve
a monthly budget set aside
for grocery and select our
items accordingly. For the
last 10-15 years, we’ve been
buying grocery from the
nearby Kirana store, who
also delivers at home and
provides good discounts with
monthly credit system.
“I am Ankit. I recently passed
out from college and got my
first job in a tech company
in Hyderabad, wherein I stay
with a flat-mate. We’ve hired
a maid to cook food for us
as outside food is pricy and
doesn’t have the homely
taste. We stock-up grocery
once in 45 days when the
maid informs that we’ve run
out of most of the things.
We buy very basic items
(unless somebody’s parents
are visiting), from a 30-min
away convenience store as it
has really good offers on bulk
purchase.”
35%
35-50
4-8 Lacs
3-5
Married couple with
parents, with or
without grown up kids
Self
15%
21-30
3-6 Lacs
1-3 (bachelors)
Alone / flat-mates
Maid
Housewife-led family Traditional budget
conscious family
Young bachelors
31. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery Household Segment – Key Convenience-first Profiles
% Cohort
Age-group2
Annual HH Income
HH Size
Living setup
Cooking ownership
Pen portrait
58%
30-40
12-14 Lacs
3-5
Married couple with
young kids, with or
without parents
Maid + Self
“I am Veena. I work in a bank
and stay with my husband
kids in Jaipur. When we
didn’t have kids, we used
to generally eat outside,
but now with kids, we
cook-at-home (with help of
maid) to ensure kids have
good quality healthy food.
We purchase groceries
from our society’s Kirana
shop as it delivers at home
and contains most of the
products we need. However,
for certain items that aren’t
of the right quality here, we
buy them from the nearest
modern grocery store”.
“I am Ajay. I stay in Ratlam
in a joint family with my
parents, uncle’s family and
my wife. We’ve a family
business. The ladies of the
house cook for everyone.
We relish home cooked food,
with every family member
having their favorites.
We have a special meal
occasion almost every week,
through business parties or
gatherings. We order grocery
3-4 times a month from the
nearby Kirana shop that
delivers at home. However,
for certain exotic / rare
products (that aren’t found
here), our servant travels to
the nearest mall to purchase
them.
“I am Sonali. I just got
married and stay with my
husband in Bangalore.
Both of us are working in
startups, where work-life is
hectic. We’ve hired a maid
who cooks for us. Through
at-home meals, my husband
I get to spend some time
together. Moreover, outside
food is unhealthy lacks
homely taste. We stock-up
grocery twice a month either
online or from the nearby
mall. We are particular obout
purchasing certain healthy
products every time (e.g.
multigrain flour, refined oil).
22%
35+
14 Lacs+
4-6
Married couple with
parents, with or
without grown up kids
Maid + Self
20%
25-35
9-12 Lacs
2
Married couple
without kids
Maid
Quality seekers Affluent foodies Young busy couple
Note: 1. The above table Indicates core convenience-first personas, but is not exhaustive; 2. Represents age-group of HH member who makes the purchase decision
32. Indian eGrocery - A promising opportunity led by value-first users
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Addressable HHs grocery purchase behavior analysis
Price sensitivity, Need for wider assortment, Need for timely access
Size of the bubble indicates need for faster access – more the size, higher the need
Summarizing the difference in the purchase behavior
priorities of the two types of eGrocery addressable
households – while value-first households prefer to get the
best priced products, with a basic assortment and limited
unplanned / emergency needs, convenience-first households
prefer wider exotic assortment, have lots of unplanned
/ emergency requirements and are less sensitive towards
pricing.
Young bachelors
Housewife-led
family
Traditional budget
conscious family
Young busy couple
Quality seekers
Affluent foodies
High
Need
for
wider
assortment
High
Low
Low
Price sensitivity
eGrocery use-case: provide wide
assortment of products with faster
delivery options
eGrocery use-case: provide value
basic product offerings, focused on
planned deliveries
33. Indian eGrocery - A promising opportunity led by value-first users
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3
Thekeytoserve
thevalue-first
opportunitythrough
eGrocery
34. Indian eGrocery - A promising opportunity led by value-first users
Page - 34
Q. In case of online grocery delivery platforms, what is your preferred delivery time?
% Respondents
“My grocery purchases are mostly planned
and hence 1-2 days of delivery time is good
enough. I’m not willing to pay higher for a
faster delivery.”
-Value-first consumer, Jaipur
“As long as I get the lower prices online for
household grocery items, I don’t mind the
product getting delivered in 2-3 days”
-Value-first consumer, Pune
“It is very rare that I order something that I
need in a matter of 2 hours or 6 hours. I’m
generally willing to wait from my order to be
delivered.”
-Value-first consumer, Ajmer
“We purchase very basic products online to
have a simple meal with the family. We do not
need to buy any exotic products that require
immediate deliveries.”
-Velue-first consumer, Mumbai
Consumers Speak
17%
19%
15%
30%
19%
Value-first HHs
Within 2 days
Scheduled delivery
zone
Within 12 to 24
hours
Within 6 to 12 hours
Within 2 to 6 hours
Within 2 hours
N=402
Most value-first
users who
preferred faster
deliveries, were
unwilling to pay
for them (as per
consumer IDIs)
~65% value-first respondents prefer online groceries
to be delivery between 6 hours to 2 days
Whatavalue-firsthousehold
expectseGroceryplatforms
Scheduled deliveries
As value-first households tend to plan their grocery purchase in advance, most of them are receptive towards getting the
groceries delivered under scheduled delivery duration. Almost 2/3rd of the value-first households surveyed were open to
getting the products delivered between 6 hours to 2 days.
~65%
value-firstrespondentsprefer
onlinegroceriestobedelivery
between6hoursto2days
35. Indian eGrocery - A promising opportunity led by value-first users
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Value-first households – Online purchase behavior by Category (Changes due to COVID)
As per Consumer Surveys
Full-basket Coverage
Pre-COVID, most value-first eGrocery users were reluctant
to order fresh groceries online – they ordered staples,
packaged FB and personal care/ home care products online
and purchased fruits / vegetables, dairy and meat from
offline stores.
However, during the COVID lockdown period, the value-first
households’ demand for ordering fruits / vegetables
online, significantly increased and is likely to sustain in the
post-COVID era. Moreover, despite being a preferred online
category for value-first households pre-COVID, staples
experienced a surge in online demand during COVID and is
likely to see further increase post COVID. Other categories
like packaged FB and fresh meat, are also expected to see a
decent increase in online share post COVID.
Hence, value-first households are now expecting online
platforms to provide complete coverage of their grocery
basket, including previously unpreferred fresh category.
eGrocery Category Pre-COVID
Online
Preference
COVID Period
Increase
Expected Shift
Post COVID
Takeaways
(% Respondents
preferring online channel
for purchase)
(% Respondents citing
increase in purchase
through online channel)
(% Change in online
share in overall grocery
spend – post vs
pre-COVID – cited by
respondents)
Packaged Foods +
RTC / RTE
69% 31% 13% Strong online
preference pre-
COVID and decent
increase expected
post COVID
Beverages
66% 28% 12%
Staples
62% 49% 20%
Strong preference
– both pre and post
COVID
FV
42% 52% 23%
Limited preference
pre-COVID, but
strong increase
expected post COVID
Meat Fish
34% 25% 17%
Limited preference
pre-COVID and
decent increase
expected post COVID
Degree of online preference
Positive Negative
36. Indian eGrocery - A promising opportunity led by value-first users
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Value-first households – Key Purchase Themes (post COVID)
Affordable, but hygienic purchase
Affordability has always been the most important purchase
criteria for value-first households. However, post COVID,
hygiene and quality have become highly important. As per
the recent surveys, more than 40% value-first households
cited that they are willing to spend more for superior
hygiene quality products, which includes products with
well packaging, trusted well-known brands, fresh clean
items and expiry monitoring. At the same time, there is an
increased reluctance towards unpackaged / loose products,
and local / unknown brands.
Trade-up for better hygiene quality
40% Value-first users
willing to spend more
for superior hygiene
quality products
1. Well packaged products
2. Trusted well-known brands
3. Fresh clean items
4. Expiry monitoring
1. Unpackaged / loose products
2. Local / unknown brands
37. Indian eGrocery - A promising opportunity led by value-first users
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eGrocery private labels can aptly serve this unique demand for affordable as well as hygienic / good quality products. Most
leading eGrocery platforms have developed a solid portfolio of private labels available at lower prices and manufactured /
packaged by trusted eGrocery brands.
Value-first households – Key Purchase Themes (post COVID)
Product Hygiene Quality
(well packaged, fresh clean products,
trusted brands)
Leading eGrocery Private Label Brands
(Selected Examples)
eGrocery
Private
Label
Products
Pricing / Affordability
(Low priced products,
non-premium brands)
38. Indian eGrocery - A promising opportunity led by value-first users
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Theuniteconomicsofserving
value-firsthouseholds
High stickiness
As the most important thing for the value-first households is affordability, they tend to stick to the platform or store that
provides them their desired benefits. D-Mart is a great example – its offerings (e.g. Everyday Low pricing, regional flavor,
limited product / brand range) are tailored according to the value-first requirements and hence it enjoys a solid consumer
retention.
Value-first households – Key Purchase Themes (post COVID)
“Loyalty of a D-Mart’s customer
is very high, since low prices
develop habitual buying patterns
and high trust among the
price-sensitive people. It has been
largely observed that a D-Mart’s
customer purchases bulk groceries
only from D-Mart and nowhere
else, which has been a key driver
of success for the leading retail
hypermarket.”
- Expert, India Retail
SolidCustomer
Retention for
D-Mart
Serving price-sensitive customers
Provides one-stop shop value retail to customers who
consciously compare prices to get the best deals (mostly
belonging to low-middle income group HHs)
Lowest prices offered
Most products have at least 6-7% extra discounts compared
to competitors in Every Day low prices (EDLP)
Regional Goods
Area-specific products catering to unique consumption
habits aimed at competing with Kiranas
High volume Sales
Low price leads to high footfall in the store leading to high
sales volume
Hyperlocal marketplace models
The focus is clear: daily consumption goods + well known
brands + limited options
39. Indian eGrocery - A promising opportunity led by value-first users
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—
High user stickiness has been the primary
driver of its revenue growth in the last few
years, wherein D-Mart has grown
much faster than its competitors,
who do not have a value-first offering.
D-Mart Revenue Growth - Benchmarked vs Future Retail
USD Bn
1.7
1.8
2.1
2.8
3.5
2.0
2.1
CY 16 CY 17 CY 18 CY 19
Future Retail D-Mart
7%
27%
X
Future retail had a combined store
area of ~16 Mn Sq. Ft. in CY 19 i.e.
2x of the D-Mart’s combined store
area (~ 8 Mn sq. ft.)
Indicates 3 Yr. CAGR %
Source: Annual Report
40. Indian eGrocery - A promising opportunity led by value-first users
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Favorable Unit Economics
Driven by the basic requirements of value-first households and their ability to stick to the affordable platforms, the unit
economics of serving the value-first households online are very promising. Most of the determinants of profitability (bulk
purchase, assortment, private labels, delivery cost, stickiness) are in the favor of value-first households, when compared with
convenience-first households.
eGrocery Household Attribute Comparison Summary
Value-first
Households
Convenience-
first Households
Details
Demand for lower prices / high
discounts
High Moderate Discounts provided by platform reduce
the net income
Bulk purchase behavior High Moderate Bulk purchase leads to high AOV, which
reduces the fulfillment cost per order
value
Assortment need Limited Very wide Limited assortment gives a better ability
to negotiate margins with brands;
Private label opennness High Moderate High gross margins led by own
manufacturing
Fast delivery demand Low High Low cost of fulfillment in case of
scheduled delivery (as orders can be
batched) vs on-demand
Stickiness to one platform Moderate – High Moderate – High Type of provider / platform plays a
huge role in consumer stickiness,
hence uncertain at a HH level. But high
stickiness, reduces marketing spend by
the platform.
Impact on profitability
Positive Negative
41. Indian eGrocery - A promising opportunity led by value-first users
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In terms of the overall structure, while an eGrocery platform serving the value-first household could lose out on gross
margins, it could save significantly on supply chain costs, because of very efficient supply chain requirements of delivering
groceries to a value-first household (mostly reliant on scheduled deliveries). As a result, the typical contribution margins
associated with serving a value-first household, tend to be much favorable than that of a convenience-first household.
eGrocery business models – Unit economics comparison
% of Fulfilled GMV
Parameters Value-first
Households
Convenience-
first Households
Details
Commission / Margin (including
additional income)
15% 22% High margins attained from pvt. label
sales brand tie ups, are passed on to
the value-first HHs to provide cheaper
products – leading to drop in platform
commissions
Cashback (-)2.0% (-)2.0% Both types of HHs are interested in
buying better priced products, instead of
cashback that can be used later
Supply chain cost (-)10% (-)20% Significantly high cost of supply chain to
serve convenient-first HHs, due to on-
demand delivery needs and low AOV
Payment gateway cost (-)1.5% (-)1.5% No difference, depending on HH needs –
could vary by platform
Marketing expense (-)4.0% (-)4.0% No difference from HH perspective –
could significantly vary by platform
Contribution Margins (-)2.5% (-)5.5%
Impact on profitability
Positive Negative
~3%
bettercontributionmargins
forservingvalue-firstHHsvs
convenience-firstHHsonline.
42. Indian eGrocery - A promising opportunity led by value-first users
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This gets further confirmed by looking at D-Mart’s
profitability trend. Riding on the favorable unit economics
of serving a value-first household, D-Mart has been able
to further improve upon a healthy +7% EBITDA in the
past few years and achieve 8-9% EBITDA range. Cheaper
procurement, lower store rents and efficient space
utilization has enabled D-Mart to attain such a promising
profitability.
D-Mart Profitability Trend
% of Revenue from operations
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
FY 15 FY 16 FY 17 FY 18 FY 19
EBITDA % Net Profit (after tax) %
Lower procurement costs through
better vendor relationships (built via
faster payable settlements), enable
the provision of consumer discounts
Self-owned stores helped D-Mart
in reducing rental costs
Store locations in residential areas
to avoid high real estate locations
like malls
Efficient space utilization,
limited billing counters and basic
maintenance interiors drive lower
operational expenses
D-Mart Profitability
Drivers
43. Indian eGrocery - A promising opportunity led by value-first users
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Value-first GMV Forecasts
Operating on a huge profitable opportunity, the value-first eGrocery segment is projected to grow faster than the
eGrocery market and account for ~55% of the eGrocery market in 2025. Value-first segment is estimated to grow at 53%
CAGR, as opposed to convenience-first segment at 44% CAGR.
eGrocery Market Estimates
GMV, USD Bn
1.5
1.8
13
11
48%
3.3
2020F 2025F
24
53%
44%
9
11
Convenience-first
HH Spend
Value-first
HH Spend
~55%
oftheeGrocerymarketin2025will
beledbyvalue-firsthouseholds.
44. Indian eGrocery - A promising opportunity led by value-first users
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eGroceryPlatformsservingthe
value-firstneeds
eGrocery Business Models
As observed in the previous sections, the value-first grocery opportunity in India is very attractive, but it requires eGrocery
platforms to serve it via specific tailored offerings.
Value-first Households eGrocery
Requirements
What is important?
What is not-so important?
Potential elements to be covered
in eGrocery platform offerings
1. Best-priced products
2. Bulk-purchase benefits
3. Hygiene quality
4. Availability of key categories
Lowest prices
Bundled / multi-pack purchase
offers
Festive sale
Private labels (packaged)
Availability of limited, but
well-known brands
X-category coverage (including
FV)
Scheduled deliveries (more
than 12 hours TAT)
1. Fast deliveries
2. Wide assortment
45. Indian eGrocery - A promising opportunity led by value-first users
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Key Business Model Developments
Player case studies (Selected Examples)
Profile Strategic Choices
Grofers is the leading value-first eGrocery platform in India. It was probably the
first eGrocery platform to truly realize the potential of the value-first space in India
and tailors its offerings accordingly. Grofers follows a private-label led EDLP (Every
Day Low Pricing) strategy to delivery affordable products at consumer’s doorstep
via scheduled delivery. It offers a targeted assortment, drives retention through
its loyalty program, leverages the local network of stores for delivery and follows a
cluster based growth strategy.
Marketplace express
delivery solving for
convenience
EDLP (Every Day Low Pricing)
strategy, riding on savings-based
value prop
Delivering orders
profitably at consumers
doorstep
Private label led EDLP (Every Day
Low Pricing) strategy, powered
with local entreprenuer led supply
chain network
Founded 2013
Founders Albinder Dhindsa, Saurabh Kumar
CEO Albinder Dhindsa
Headquarters Gurugram, India
Total Funding USD 472 Mn+
Major
Investors
Tiger global, Sequoia Capital,
Softbank Vision Fund, Apoletto
Asia, KTB ADCG
Value first
Target
households
Convenience-first
Express
Micro
Delivery
model
Scheduled
SKU – 2000+
Assortment
Brands – 280+
2015 2018
2017 2020
46. Indian eGrocery - A promising opportunity led by value-first users
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Key strategic elements
Private label focus
Riding on its private label offering
to provide low-priced hygienic
products to its value-first users.
30% of SKUs are private labels.
Cluster based growth
strategy
Grofers follows a cluster based
expansion strategy to go deeper into
Tier 2, 3 4 cities having a population
of ~1mn and above.
From their warehouse in Delhi they
are serving cities like Sonipat, Panipat,
Meerut, Chandigarh, Aligarh, Bhiwadi,
Moradabad.
Loyalty Program
Grofers has a loyalty program called
Grofers Smart Bachat Club which
offers cheaper prices, exclusive offers
priority support to its enrolled
members, ~70% of the GMV is driven
by the loyal users on the platform
Local Entrepreneur-led
Supply Chain
Local partners enabled micro warehousing
for storage of orders (drop points) that
are picked and delivered by local delivery
partners it to the customers’ doorstep.
95% of the orders are fulfilled by the local
network close to the customers.
Customer centric
shopping experience
To enchance the everyday grocery
shopping experience, Grofers introduced
multiple personalised widgets (to save
more) and games like spin the wheel,
lucky draw (to enjoy and win prizes) for
the consumers
Focused Assortment
Grofers focuses on providing a
targeted assortment, considering
the needs of its target users who
are not interested in choice or
variety of products / brands
47. Indian eGrocery - A promising opportunity led by value-first users
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A unique thing that stands out for Grofers is its end to end technology enabled supply chain, largely managed by local
entrepreneurs. From sourcing to warehousing to drop points to delivery, each step is highly organized with the help of
technology. Once the packaged orders leave from the warehouse, everything including drop point management to doorstep
delivery, is executed by local entrepreneurs (e.g. travel agent, mobile recharge shop owners etc.) who reside closer to the end
consumer.
Typical Grofers Delivery Process
Key Highlights:
1. Grofers has significantly
organized the unorganized supply
chain with the help of technology
2. Once the packaged orders leave
from the warehouse, everything
is run via partnership with local
entrepreneurs (e.g. travel agent,
mobile recharge shop owners
etc.) and not Grofers
3. The packed orders go to
micro-warehousing stores
(drop points) managed by local
entrepreneurs who are in
proximity to the end consumers
and deliver to their doorstep
Collective Sourcing
(Brands + Private labels)
Drop Points
managed
by local
entrepreneurs
Doorstep
Delivery
by local
entrepreneurs
Warehousing
48. Indian eGrocery - A promising opportunity led by value-first users
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Through a solid value-first model run by Grofers, which includes high private label share, low cost supply chain and a sticky
userbase, Grofers has aptly demonstrated the profitability of serving the value-first opportunity. It improved greatly on unit
economics last year, wherein it garnered higher margins through direct brand tie ups increased private label sales and
reduced its marketing / cashback spend, owing to organic eGrocery demand last year and high value-first stickiness.
Grofers Case Study – Unit Economics
% of Fulfilled GMV
Parameters Pre-COVID
(Dec’19)
COVID Period
(Jun’20)
Details
Commission / Margin (including
other income)
12% 15% Higher sale of private labels, coupled with
brands tie ups during COVID, led to higher
commissions
Cashback (-)6% (-)1% Significant drop in discounts as online
grocery gained organic preference during
COVID
Supply chain cost (-)9% (-)8% Customer category penetration increased
during COVID, driving higher AOV and
hence lower cost of delivery as % of order
value
Payment gateway cost (-)1% (-)1% No major change
Marketing expense (-)8% (-)1% Significant reduction in marketing spend
as eGrocery adoption was mostly organic
during COVID
Contribution Margins (-)12% 4%
Impact on profitability
Positive Negative
—
Grofers currently operates on +4% positive
CMs, truly harnessing the profitable
value-first opportunity.
49. Indian eGrocery - A promising opportunity led by value-first users
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Key Business Model Developments
Profile Strategic Choices
JioMart launched its eGrocery service last year across 200 cities, focusing on the value-first
demand in Tier 2+ markets. It received solid backing by the leading investors from all over the
world, including tech giants Facebook Google. Aiming to effectively serve the value-first
needs, JioMart delivers products via scheduled delivery model, offers lucrative discounts,
has a good private label range and provides free deliveries without any minimum order value.
It has helped in expanding the eGrocery sector’s reach across 200 cities, harnessing the
untapped demand in Tier 2+ markets with the help of Reliance’s / Jio’s strong brand presence.
Founded April 2020
Chairman Mukesh Ambani
Headquarters Mumbai, India
Total Funding $20 Bn (all Jio Platforms)
Major
Investors
Silverlake, Facebook, Google,
Mubadala, Vista, TPG, General
Atlantic, ADIA
Value-first
Target
households
Convenience-first
Express
Micro
Delivery
model
Scheduled
SKU – 2000+
Assortment
Brands – 280+
Facebook-Jio deal, later
attracted funding from all
investors including Google
eGrocery service
launched across 200
cities in India
Focusing on including
other retail categories like
electronics, fashion etc.
Free deliveries provided,
without any min. order
value
Apr’20 May’20 Jun’20 Jul’20
50. Indian eGrocery - A promising opportunity led by value-first users
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Key strategic elements
Hybrid Model
Inventory will be a mix of local
Kirana and Reliance retail (fresh,
smart etc.) stores, to ensure better
fill rates O2D. Delivery points
(Smart Points) setup to service the
demand better.
Fresh Offering
Implemented via existing Reliance
Fresh offline retail stores.
Private label focus
Reliance private labels are the focus
SKUs for JioMart (enjoy prominent
website space) – to help will better
monetization margins
Free Delivery
Orders placed on JioMart are free of
any delivery charge no minimum
order amount limit is applicable.
Tier 2+ Reach
The only eGrocery platform to have
presence across ~200 cities, riding
on huge pool of Jio users in Tier 2+
cities, who have a strong brand trust
for Reliance.
Discounts
High discounts across categories
to attract consumers – providing
‘minimum 5% below MRP’ on
selected products.
51. Indian eGrocery - A promising opportunity led by value-first users
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JioMart has the capability to enable fulfillment via Reliance retail stores. It is building extensive Kirana partnerships to help
them procure groceries via its organized eB2B channel and leverages those partnerships to fulfill the eGrocery demand as
well. Currently, the Kirana-led fulfillment accounts for only 5% of JioMart’s eGrocery business and rest is led by Reliance
retail stores. In future, JioMart is looking to increase its Kirana fulfillment share and is also looking to build dark stores in
geographies with limited Reliance retail presence.
JioMart Order Flow for B2C
Online
Customer
Return
End
Customer
Dedicated
Delivery Boy
Same Shop Staff
basis availability
Same Day
Delivery
Next Day
Delivery /
Cancel
Product
Available
Unavailable
B2B Fulfilment via
5% fulfilment1
95% fulfilment1
Kirana
Check
Product
Availability
Smart
Point
Reliance
Smart
3PL
In-House
Reliance Retail
Check
Product
Availability
Two Day
Delivery
Cancel
Products
Reliance
Fresh
Available
Unavailable
A
A
B
Customers has
option to return the
damaged/ wrong
product during the
time of delivery.
Otherwise,
platform offers
refund for low
value items rather
than doing reverse
pickup.
Pin Code based
decision on
fulfilling, first,
Reliance Retail,
and, second, an
associated
Kirana
52. Indian eGrocery - A promising opportunity led by value-first users
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We conducted ~4500+ surveys with consumers having different online maturity level and belonging to different city tiers
income groups. In addition to the quantitative surveys, ~40 in-depth consumer interviews were performed to understand
the in-depth consumer insights.
29%
56%
15%
eGrocery user
eGrocery non-user - online shopper
eGrocery non-user - offline shopper
41%
19%
40% Tier 2+
Tier 1
Metro
Annual Income
City tier
24%
43%
23%
10%
12-16 Lacs
8-12 Lacs
4-8 Lacs
4 Lacs
Total surveys performed (N) = 4500
Methodology
Consumer Research
53. Indian eGrocery - A promising opportunity led by value-first users
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Addressable market sizing
Online Service
Users in India
Consumers
transacting for
services online
(e.g. banking/
recharge) but
may not buy
products online
Source: RedSeer IP
eGrocery
addressable
households
From (1)
Online
Service User
to Household
Conversion
Factor
Source: RedSeer IP
Yearly grocery
purchase
frequency per
household
Source: Consumer
surveys
Online
Service Using
Households
(Number of
Households)
Average Order
Value (AOV)
of grocery
purchase per
household
Source: Consumer
surveys
Households
unaware of
eGrocery and
unwilling to
try eGrocery
services
Source: Consumer
surveys
eGrocery
Addressable
Wallet.
(USD Bn)
eGrocery
addressable
households
(Number of
Households)
1. Calculation Methodology – eGrocery addressable households
2. Calculation Methodology - eGrocery addressable Wallet
X
X X
= =
-
=
54. Indian eGrocery - A promising opportunity led by value-first users
Page - 54
Glossary
SN Keywords Definition
1 Grocery Products sold in a grocer’s shop – includes fresh (fruits vegetables,
dairy products, meat), staples, packaged foods, beverages, home care
and personal care
2 eB2B Grocery Online platforms that facilitate online sourcing of grocery products for
retailers (mostly Kiranas)
3 eB2C Grocery or eGrocery Online platforms that enable online ordering and delivery of groceries to
consumers (does not include BPC fashion verticals like Nykaa, Purplle,
Myntra)
4 USD US Dollar, 1 USD = INR 70 (unless otherwise specified)
5 Metro Cities Mumbai, Delhi, Bangalore, Chennai, Hyderabad, Kolkata, Pune and
Ahmedabad (8 cities)
6 Tier 1 Cities Non-metro cities with population more than 1 Mn (54 cities)
7 Tier 2+ Cities Non-metro cities with population less than 1 Mn (4400+ cities)
8 Stock-up Purchase of grocery items in bulk amounts, mostly once or twice a
month
9 Non-daily Top-up Purchase of grocery items in limited amounts, mostly once or twice a
week
10 Daily Top-up Purchase of everyday grocery items (milk, bread etc.)
11 Unorganized grocery Local grocery retail shops (Kirana stores)
12 Organized BM grocery Modern grocery retail shops (supermarkets, hypermarkets, convenience
stores)
13 Gross Merchandise Value
(GMV)
Refers to selling price of the orders placed on the eGrocery platforms,
excluding cashbacks