Quick commerce drove overall ecommerce for these companies as well as the broader fast moving consumer goods (FMCG) industry, executives said.
The contribution of quick commerce was 15-18% in FY23.FMCG companies have consistently reported the fastest growth in sales from ecommerce since the pandemic, followed by modern trade or grocery retail chains, and then general stores or kiranas. This trend has gathered momentum in FY24.
FMCG companies have consistently reported the fastest growth in sales from ecommerce since the pandemic, followed by modern trade or grocery retail chains, and then general stores or kiranas. This trend has gathered momentum in FY24.
The shift has led Walmart-backed Flipkart to plan a quick commerce entry.
Parle Products vice-president Mayank Shah told ET that the speed of the change has been surprising, with consumers not balking at the extra convenience fee. Quick commerce companies such as Zepto, Swiggy, Blinkit and BB Now are enthused enough to move into newer markets.
FAST FORWARD
“Even the burning of money through discounts has come down a bit. Time has become a premium for people,” he said.
Social commentator and brand specialist Santosh Desai said quick commerce has reached a stage of normalisation, with people not wanting to plan their purchases in advance. “For more and more consumers, the convenience cost charged by quick commerce is much lower than planning a shopping trip or ordering in advance,” he said. “It’s a new value equation in their life.”
Zomato is rapidly expanding its Blinkit quick commerce business, aiming for 1,000 dark stores (warehouses from where goods are shipped to consumers) by March 2025, from 526 as of the March quarter, it said on Monday in its earnings release.
While Blinkit is present in 26 cities, the expansion focus is on the top eight cities such as Bengaluru, Mumbai and Hyderabad, it said.
Dabur India chief executive Mohit Malhotra told analysts earlier this month that quick commerce is contributing around 30% to the ecommerce business. “And we want to get in with Swiggy, Zomato (Blinkit), Zepto — all those coming and opening up the towns, one after the other, in urban India. That presents a big opportunity,” he said.
RISING POPULARITY
Sales growth through ecommerce for FMCG companies has been two to three times more than that of modern trade.
For instance, Tata Consumer Products’ ecommerce sales grew 35%, compared with 9% for modern trade. The contribution of modern trade to overall sales was stagnant at 14% for the company, but that of ecommerce went up from 9% in FY23 to 11% in FY24.
Adani Wilmar managing director Angshu Mallick said quick commerce is driving growth of the overall ecommerce pie for FMCG. “In fact, there are consumers who are now ordering every half an hour. Our fastest-moving items in quick commerce are packs of mustard oil, sunflower oil and atta,” he said.
Nestlé said in its latest investor presentation that ecommerce contribution to domestic sales has grown five times in the last five years — from 1.3% in 2018 to 6.8% till March 2024 — driven by “significant growth in quick commerce.”
Apart from quick commerce, even beauty commerce and marketplace are growing for HUL in the overall ecommerce pie, Jawa said.
