MB20MM208 - SOCIAL MEDIA AND DIGITAL MARKETING

MNI PROJECT

THE GROWTH OF Q COMMERCE

GROUP MEMBERS

Vaddi Hemanth - RA2152001040077

Beri Perm Sai Reddy - RA2152001040081
Jatin J Gupta - RA2152001040084
Chandni Ayani - RA2152001040085
Syed Riyaz Ahmed - RA2152001040088
Aishwarya - RA2152001040109
Nija - RA2152001040116
 THE GROWTH OF Q COMMERCE
INTRODUCTION

Q-commerce, also referred to as quick commerce, is a type of e-commerce where emphasis is on

quick deliveries, typically in less than an hour. Q-commerce originally started with food delivery and
it still represents the largest chunk of the business. It has quickly expanded to other categories Q-
commerce, also referred to as quick commerce, is a type of e-commerce where emphasis is on quick
deliveries, typically in less than an hour.Q-commerce originally started with food delivery and it still
represents the largest chunk of the business. It has quickly expanded to other categories particularly for
grocery delivery, medicines, gifts, and apparel etc. Since early 2020, the restrictions imposed due to
COVID-19 pandemic gave a major boost to q-commerce as it allowed retailers to remain operational
via quick home deliveries. These prolonged restrictions resulted in long term consumer behaviour shift
towards quick deliveries, and established q-commerce as the third generation of commerce. for grocery
delivery, medicines, gifts, and apparel etc. Since early 2020, the restrictions imposed due to COVID-
19 pandemic gave a major boost to q-commerce as it allowed retailers to remain operational via quick
home deliveries.These prolonged restrictions resulted in long term consumer behaviour shift towards
quick deliveries, and established q-commerce as the third generation of commerce.

The evolution of quick commerce started in 2011, with companies like Postmasters, but only started to
gain scale and traction around 2017 as companies like Delivery Hero and Meituan expanded into the
area.Initially, delivery time hovered around 60 minutes but by 2019 several companies started local
warehouse concepts (cloud stores or dark stores) to drive speed down towards 20 minutes.
There are three main types of e-commerce: business-to-business (websites such as Shopify), business-
to-consumer (websites such as Amazon), and consumer-to-consumer (websites such as eBay).

Business-to-Business
Business-to-business, or b2b, is the practice of selling online from one business to another, in other
words, wholesale.
Business-to-Consumer
Nowadays, a lot of e-commerce is b2c, as it’s easy for businesses to target specific consumers online.
Businesses are able to put their products online, allowing the consumer to purchase the products in the
comfort of their own home, saving them some precious time.

Consumer-to-Consumer
Remember that shirt you bought? You didn’t have time to send it back to the retailer to return, so where
did it end up? At the back of your wardrobe, never to be worn by you. Why not sell it on? Thanks to
websites like eBay, you, the consumer, are able to upload images of the product and sell it on to others
that may be interested in buying it.
 How Q-Commerce is Becoming One of the Fastest Growing E-commerce Models

Quick Commerce sector is expected to grow by 10-15 times and is expected to become a $5 billion
industry by 2025. In the past two years, Covid has augmented the digital adoption drive by consumers
in the retail industry. With the shift in consumer behavior, the business of delivering essential
commodities in the timespan of 10-30 minutes, popularly known as ‘Quick Commerce’ is rapidly
penetrating the growing e-commerce market of India.

Taking on the lead, the grocery delivery company Grofers has rebranded itself to Blinkit while Swiggy
has set up its new 15 minutes delivery platform ‘Instamart’. Even the stalwarts such as Flipkart,
Amazon, Ola, BigBasket, etc. have also ramped up their operations and joined the bandwagon.
While India is the third-largest grocery market in the world, it has the lowest (less than 1 percent) online
grocery penetration compared to most of the major markets. Quick Commerce will disrupt the e-
commerce market while creating a strong habit of convenience available to customers.
Two major opportunities offered by the Indian Quick Commerce market include consumables (home
care, personal care, OTC drugs, beverages, fresh staples, pet supplies, packaged foods, alcohol, and
tobacco) and adjacent categories such as (books, gifts, cards, small electronic items, etc.). Although
many items in these categories don’t fall into quick need of being delivered in 10 minutes however
looking at the shifting consumer behaviour, companies don’t want to leave any stone unturned in
providing the best services to the customers.

What Does The Research Say?

As per a report titled “Quick Commerce: A $5 Billion Market by 2025” by the consulting firm Red
Seer, India’s Quick Commerce sector is expected to grow by 10-15 times and is expected to become a
$5 billion industry by 2025. The biggest growth driver leading the rise of Quick Commerce in India is
a shift in consumer behaviour. Today’s customers are looking for convenience over value, weekly
purchases compared to larger monthly purchases, increasing convenience of unplanned purchases,
indulgence, and top-up purchases by Gen-Z customers as well as Covid-backed replacement of visiting
traditional Kirana stores for safety reasons.

The study also found that in India currently 20 million households can be addressed by the Quick
Commerce delivery model which is around 7 percent of the overall market and expected to grow at the
rate of 12-13 percent by 2025. Additionally, the exponential growth of the online consumables market
will also play a pivotal role in driving this growth. Around 50 percent of this growth will come from
the high-income households of metro and Tier-I cities. Other factors contributing to this growth are the
willingness to pay minimum delivery fees for 10 minutes delivery which saves consumers time and
effort, increasing demand for healthy and easy-to-cook products, nutritional products, and rising
demand for newer products through global experiences.
 TOP Q COMMERCE COMPANIES IN INDIA

The key players in the quick commerce model include Mumbai-based Zepto, food-tech platform
Swiggy’s Instamart, and Dunzo Daily. Swiggy’s Instamart will deliver within 15 minutes via a network
of dark stores located close to the bulk of its customers.

ZEPTO

Zepto started its services in April 2021 to deliver groceries, personal care products, home essentials,
baby care, products — within 10 minutes. The average delivery time is 8 minutes 40
seconds(approx).Cities Covered: Bangalore, Mumbai, Delhi, Chennai, Hyderabad and Pune.

SWIGGY INSTAMART

Swiggy Instamart launched in August 2020 with a quick commerce business model to deliver
groceries within 45 minutes to customers around 18 cities. Today, it processes 1 million orders
weekly.Cities Covered: Bangalore, Delhi-NCR, Hyderabad, Mumbai, Chennai & Pune

DUNZO

A quick commerce company in India, Dunzo Daily delivers home groceries, food, medicines, pet
supplies, health and wellness, gifts, bike rides, pick and drop, laundry delivery, etc — within 35-40
minutes at a minimum delivery fee.Cities Covered: Gurgaon, Pune, Chennai, Mumbai and Hyderabad,
Bangalore, Delhi & Hyderabad.

BIGBASKET

Just like other quick commerce start-ups, Big basket is also establishing a network of ‘dark stores’ and
using advanced technology for instant deliveries.Cities Covered: Serves 40+ cities — Delhi, Bangalore,
Visakhapatnam, Surat, Patna, Indore, Chandigarh, Jaipur, Hyderabad, Mumbai, Pune, Chennai, and
many others.

BLINKIT

Formerly called Grofers, it has now rebranded as Blinkit with the vision to deliver consumer goodsin
10-20 minutes. It is currently operating in 14 cities. Cities Covered: Agra, Ahmedabad, Bengaluru,
Chandigarh, Chennai, Delhi-NCR, Hyderabad, Jaipur, Kolkata, Mohali, Mumbai, Pune, UP-NCR.
Zepto
Zepto business model was developed by a couple of successful instant grocery delivery startup
founders. The company was founded by a couple of teenagers. Zepto was recently successful in raising
$100 million for financing its operations. This funding operation was led by Y Combinator and took
the valuation of Zepto up to $570 million in a space of 5 months after beginning their operations in
India. The Zepto business model works within the quick commerce segment in India that is running red
hot. Zepto was named after a small unit and it was started by Aadit Palecha and his childhood buddy
Kaivalya Vohra who were both 19 at the time.

Both the Zepto founders were studying computer science at Stanford University and left the course to
enter quick commerce in India. The Zepto business model promises to deliver your grocery in 10
minutes. The company began its operations in Mumbai in 2021 and has since extended its operations
to Delhi, Bangalore, and 4 other major cities. The business of online grocery delivery is already taking
off in India with a $1 trillion retail market perceived. Purchasing groceries account for the majority of
your retail spending.

The arrival of Zepto in India

Even the arrival of the startup in India was a bit serendipitous. Both Kaivalya Vohra and Aadit Palicha
had returned to the country for a break just before the coronavirus pandemic engulfed India. Both these
teenagers had partnered on several other projects earlier. They created a ride-hailing commute
app suitable for school-going kids. But this time they found themselves locked in their homes when
they arrived in Mumbai.

With the pandemic raging on mercilessly, both the teenagers were struggling to get their grocery
supplies. This was even though grocery deliveries were categorized as essential by the government.
They felt the need for having an online player for the grocery delivery sector in India. Despite being
one of the largest markets in the world they were still grappling with some execution errors.

The $100m funding

The new funding Zepto has received recently comes just 45 days after they raised $60 million with a
valuation of $225. This information was provided by the CEO and co-founder of Zepto Aadit Palicha
in one of his interviews. Apart from a huge contribution from the continuity fund of Y Combinator, the
Zepto business model was also successful in getting investments from existing and new players such
as Nexus Venture Partners, Glade Brook Capital Partners, Breyer Capital, and a Silicon Valley investor
called Lachy Groom.

Zepto and the competition

However, the Zepto app is also facing tough competition in India, coming in the form of Blinkit. It is a
startup backed by Softbank group Corporation. Other competitors Zepto has to face include Dunzo
backed by Google. There is Swiggy’s Instamart, backed by Naspers Limited. You have Flipkart backed
by Walmart Inc and companies such as Amazon.com Inc. However, the startup Zepto is growing fast
and the core unit economics of the company are pretty strong as informed by the CEO Palicha.
The 10-minute delivery

The concept of 10 minutes delivery from the Zepto business model has turned out to be the game-
changer. This was conveyed by the other co-founder of Zepto, Vohra. He is also the chief technology
officer of the organization. This new funding, they have received also means that the Mumbai-based
startup can grow its team to expand into newer markets and cities to extend their outreach.

How Zepto works

Zepto has more than 100 places called dark stores or micro fulfillment centers that lie in higher-demand
neighbourhoods. These dark stores use technology for performing tasks such as the placement of
products. Some other tasks they perform include deciding the store locations, and mapping delivery
routes for avoiding heavy traffic congestions. The company is already delivering in the excess of 2500
items that include cooking necessities, fresh produce, personal care items, snacks and beverages, and
home cleaning items.

The founders of Zepto bring an execution similar to Doordash to their q-commerce Zepto business
model. This fact was disclosed by Anu Hariharan, who is a partner in the continuity fund of Y
Combinator. This amazing startup is adding 1,00,000 new customers to their list each week she
quipped.

Acquiring talent

One of the main things that went in the right direction for the startup was the talent acquisition
department. They were able to attract several top-profile executives from Amazon Uber, Pharmeasy,
Flipkart, and Dream 11 to join their organization. The main thing that led to so many top executives
deciding to join Zepto was that it allowed several people that moved to Bangalore to come back to
Mumbai. However, the aggressive growth of the startup, its ambition, and its disciplined execution
have led to several people that are similarly inclined to be attracted to the company.

Order volume Claims

Both Instamart and Blinkit (formerly grofers) have claimed that their weekly order volumes have
reached in the excess of one million. What about Zepto? How many orders are they delivering at the
moment? Well, the Zepto owners are not too keen on publishing their numbers. But they are telling that
with the current numbers, they will easily surpass all the competitors to become market leaders in 4 to
5 months.

However, with the numbers available floating around, they do have some competitors they need to
respect. But there is just a lot of gas and little substance in their claims they feel. Several factors are
leading up to those numbers such as fraud rate, where is the business coming from, who is ordering etc.

Future forward

The fact remains that Zepto is growing faster than anyone else in the niche at the moment. They have
plans to grow into newer cities as quickly as possible. They are also planning to extend their coverage
to micro-markets to become a decisive leadership in the sector. Several other people are trying to
participate in the market and trying to grow quickly. But they cannot promise things such as 10-minute
delivery as consistently as Zepto. This period extends to 30, 40, and 45 minutes in most cases. Zepto is
a detail-oriented and intense business with strong technical and operating discipline that allows them
to pull off the 10-minute delivery.
Dunzo
Dunzo is a hyper-local on-demand multi-delivery service app. By charging a small delivery fee, Dunzo
delivers anything and everything to its users. For instance, if you forgot your laptop in your office, If
you forgot some important files at home, Dunzo can get them to you on demand. Or if you want to buy
some groceries from the market, buy a shirt from the store, the multi-delivery service company will get
it for you.

The success story of Dunzo is living proof that if you are determined to solve your people’s problems,
you will succeed. Before Dunzo, people might barely know; they would be able to run all their errands
through their smartphones. Grocery to food delivery startups was setting their foot in the on-demand
delivery market. While there are still many necessary chores, people have to manage their time to
complete them.
Kabeer Biswas was a brilliant man who realized more than recognized such errands and came up with
the business model for Dunzo.
The arrival of Dunzo in India
Kabeer Biswas, the mastermind behind the Dunzo, is a computer science engineer. He was living in
Gurgaon and had a pretty busy schedule. Even after living with modern amenities, he struggled to spare
time to run his errands and household tasks. The situation often caught him wondering why there wasn’t
a solution to find time for his chores.
After his first startup, Hoppr, acquired by Hike, he got time to think about what he should do next. He
shifted to Bangalore, and there again, he needed to find help with his chores. This time the thought hit
his mind that there must be other people like him, juggling with their schedule.
So, he decided to build a startup around this problem, helping people complete their daily to-do lists.
At first, he started WhatsApping and running errands his friends requested of him. This is how he tested
his business model for Dunzo. More and more people began to know about this magical WhatsApp
number, getting all their errands done.
Words kept spreading, and requests kept skyrocketing. In June 2015, he hired a few people from an
NGO on a part-time basis to complete 70 deliveries in a day. The surge in demand caused him to
transform Dunzo from a WhatsApp-based service to an app in 2016. Meanwhile, other co-founders and
investors stepped in, which resulted in the massive success of the Dunzo app.

Dunzo - Growth and Revenue

Initially starting in 2015 on Whatsapp, when the users typed their needs and Dunzo used to deliver the
same promptly, to now, when Dunzo is hailed as an all-in-one 24X7 delivery ecosystem to pick and
deliver anything and everything within the city, the growth is right in front of us. Furthermore, it is
important to note that Dunzo has its headquarters in Bengaluru and is now serviceable in 8+ cities in
India, which entered Chennai in 2018 after starting its operations in Hyderabad in the same year.

Dunzo Daily

The company has last launched its new dark store named Dunzo Daily, which started in Bengaluru and
claims to be designed as a grocery delivery service. As per the recent updates, Dunzo Daily has also
been launched in Pune in February 2022, and will have its stores set up in over 10 Indian cities during
the first half of 2022. Dunzo Daily has entered Mumbai, as per reports dated April 7, 2022, Dunzo's
service will also operate in the satellite towns of Navi Mumbai and Thane. This makes Dunzo Daily
operable in 4 cities - Bengaluru, Chennai, Mumbai and Pune, and is aiming to be launched in Hyderabad
and Delhi NCR later in April 2022.
Dunzo Daily is currently growing 100% month-on-month, and is presently relying on its strong supply
chain to streamline its operations. The fresh fruits and vegetable delivery service arm of Dunzo is now
aiming to have 200 mini-warehouses, have 30,000+ delivery partners, and has set a target of completing
2 lakh orders daily by June 2022.

The word "Dunzo" has grown from just the name of a startup to a verb in the real world, where people
prefer to just dunzo things.
Here's a glance at the growth highlights of Dunzo:

 The company is spread across 8 of India's metros

 Dunzo is backed by none other than the IT giant Google
 The company also has a bike taxi service in Gurugram

 Dunzo boasts of a whopping 40X growth in the last 2 years, as reported in March 2021
 Dunzo Daily has been discovered to be growing at 25% week-on-week

 Google-backed Dunzo scaled its revenue by 1.6X in FY21 and has prominently reduced its
expenses by 43%
 The company is presently growing 10-15% month-on-month

Features of Dunzo
Easy order placement
Most people choose to order online because placing orders is fast and convenient. This is only possible
if the app is configured in a friendly manner. Dunzo’s team is well aware of this and understands they
have developed an easy user interface. The UI allows users to easily find what they need without giving
users too many troubles while placing an order.

Easy and multiple payment methods

Payments play an important role in the business of any company. Although this is the last order
placement process, the customer will not come again to your app if they encounter any issues in
payment. For an efficient and easy payment process, customers must have all the payment methods in
the app and Dunso exactly did that. They have integrated all the possible payment gateways and mobile
wallet app services available in the market such as Google Pay, PayPal, Amazon Pay, Credit/Debit
Card, Online Banking and Cash On Delivery (COD), etc.

Discounts, rewards, and coupons

dunzo offers discounts and exclusive deals to attract more customers all the time. Based on research,
about 40% of users use the food delivery app to check coupons or cashback, 25% of users use these
apps to gain loyalty plans.Dunso is more interested in building brand loyalty to potential consumers
instead of building brand awareness.

Real-time tracking
This is one of the key features of Dunzo, which enables customers to track the location of the food
delivery person via real-time GPS. GPS is designed to provide two-way tracking. It helps to define the
location of the consumer to deliver the food. And once that area is confirmed, the progress and
movements of the delivery person can be easily monitored. Google Maps, Mapkit, or Ways Navigation
are some of the best APIs for this functionality.

Push notifications
Dunzo constantly sends notifications and alerts to their customers, which is the perfect way to build
exposure and keep competitors ahead. This allows them to keep in touch with customers. These
notifications help to relay any information such as advertisements, deals, localized news. Constantly
reminding your future discounts, exclusive deals, and loyalty plans. This makes it easier to attract and
engage customers.

Social media integration

Social media has played a key role in online marketing over the past few years. This is also one of the
simplest ways to promote the app. By connecting to social media, Danzo allowed customers to quickly
share pictures or videos of their favorite foods with their friends and family.
Review and rating
Every company cares for its customers because they are the soul of the company. Allows any review
and rating feature to know the disadvantages of the food delivery app as per its requirement. This feature
allows Dunzo’s customers to search and compare multiple restaurants with its specific dishes.

Benefits of Dunzo application

There are numerous benefits to using dunzo. The online multi-service delivery app offers a wide range
of services, including groceries, vegetables, medicines, packaging, and everything that can be moved
from one place to another. It enhances customer reliability in use with unique and luxurious services.

No need to travel
Sometimes the items we need may be indifferent stores and we get tired before buying them due to
travel. Or you need an item very urgently but you are in a situation where you can not go to buy it. Use
apps like dunzo to solve such problems. All you have to do is open the app on your mobile and order
the items you need. The delivery person will bring the items you ordered to your home. You don’t need
to travel to buy goods.

Anytime and Anywhere

The Dunzo app offers anytime anywhere service which means the customers can trust the service
providers for pick up and delivery no matter the time and emergency services; Medications are brought
this way for those who need them at the right time.

GPS tracking
Customers and delivery persons can use the instant tracking feature so they can see each other’s location
and progress and accurately know the pickup and delivery time with the estimated time delivery feature.

On-demand delivery
One of the biggest advantages of the Dunzo app is that it provides customers with an on-demand
delivery service for a variety of products ordered on their mobile phones. Customers select and order
products that will be delivered to local customers within an hour.

Hygiene and convenience

people want to be healthy and clean, they want to get their daily medication without any hassle. The
best way to solve this problem is to allow on-demand delivery apps such as dunzo to deliver the
medicines. and we can get our order from the delivery person without any physical contact.

Wrapping up
The Dunzo app is very easy for customers to use. The user can place an order and the task will be
immediately assigned to a delivery person. The chat interface helps to find the real needs of the
customers and deliver exactly what they need. dunzo app Development helps business owners
maximize revenue through this type of on-demand service. The delivery partner meets the customer’s
requirements by picking up or delivering the product without delay. dunzo is an app that is required to
provide and receive the best online service for customers and business partners. deciding to develop an
app like dunzo will take you to the peak of success.

Dunzo - Funding and Investors

Dunzo has raised a total funding of $368.4 Million in over 16 rounds of funding. Dunzo raised $240
mn from a funding round led by Reliance Retail and a clutch of other existing investors including
Alteria, Lightrock, Lightbox, Alteria Capital, and others on January 6, 2022. Reliance Retail also
confirmed that it will own 25.8% stakes with its $200 mn. The previous Series E funding round was of
$40 Million that came from Google, LightBox, and others.
The Reliance funding, which was highly anticipated is now quite real. This would further inch the
Indian billionaire Mukesh Ambani towards his dreams of building the Reliance super app, as per the
reports dated October 21, 2021.

Dunzo's funding details are as follows

Dunzo - Business Model and Revenue Model
Dunzo functions through an app and a website. It provides on-demand concierge service in the hyper-
local market. Dunzo offers many features under one roof, i.e., its app suffices for all possible needs.
Home groceries, food, medicines, pet supplies, health and wellness, gifts, bike rides, pick and drop,
laundry delivery, and various other categories/services are provided by Dunzo.
Dunzo works through a data-driven platform where it connects a delivery person to the nearest user.
The activity of this person can be tracked throughout the delivery. When there are any purchases to be
made, the users can even use the chatbox, send relevant images of the specific product, and
communicate accordingly. Dunzo also provides Dunzo cash and other digital payment options. Dunzo
uses Artificial Intelligence with its platform to give the users a satisfactory and smooth experience.

The reason behind Dunzo’s success is, it has diversified its revenue stream into five significant streams.
 Dunzo earns from delivery charges (the delivery fee may vary from ₹10-₹60).

 A specific percentage commission from the partner’s store.

 And if demand in a particular area increases suddenly, they charge more money; that’s also
called Surge Pricing or Demand Pricing.

 The charges for services like pick and drop, home repairs, and getting something from
somewhere also differ.

In The Future…
The google-backed delivery startup, Dunzo aims to become a Unicorn and hit the $1Billion revenue
business. They may add two new cities to their target this year. Their goal is to hit 20 urban centers by
the middle of 2023. What’s more? Dunzo has also initiated to offer 15-minute deliveries for nearly
2,000 commonly sought-after items.
CONCLUSION

The Covid-19 pandemic disrupted supply chains, resulting in the birth of q-commerce, a unique
business model in which products and services are delivered within 10-30 minutes after ordering. It's
also known as 'on-demand delivery,' and it focuses on micro to small amounts of commodities such as
groceries, stationery, and over-the-counter pharmaceuticals. The vendors have changed their
concentration away from typical warehouses on the periphery and more towards micro-warehouses
near the delivery site.

We have entered into a new era of commerce i.e., is of quick commerce. Quick commerce is very
rapidly gaining ground in tier 1 cities and expanding itself very rapidly in tier 2 and 3 cities. There are
certain factors which are very crucial for the success of quick commerce which is:

 Delivery charges

 Minimum order value

These two are the most critical factors as far as the success of these platforms is concerned and
companies should focus a lot on them to ensure that their customer doesn’t face many problems
pertaining to these two factors otherwise, they might end up losing their most loyal customers as well.
The best thing about this model is that there is no particular segment of the customer which is using
these apps more but people from various geographical and demographic conditions are using these
services and they are also quite satisfied with these services and this is evident from the research which
we did in which overall shopping experience on these platforms was very high. Multiple merchants
will embrace the utilization of micro-fulfilment solutions, according to industry trends, and Q-
commerce will increase dramatically in the coming years. The democratization of mobile internet, the
advent of eCommerce, and just-intime demands have all changed the warehousing and logistics
industry. This rise is being fuelled by a shift in customer behaviour post-Covid-19. Customers would
expect a wider range of products, such as electronics, apparel, and cosmetics, to be delivered quickly.
Integrating technology and automation in warehousing and logistics is one approach to respond to the
market's quick development.
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