EGrocery Marketing in India

8/10/2019 EGrocery Marketing in India

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E- Grocery Market In India


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India is 6th Largest Grocery Market in the World

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Size of Food & Grocery Market in USDBillion

2006 2010 2020

Source: IGD Research & Estimates

236302

482

Indian Retail Sector Quick Facts

Organized Retail penetration 5-8 %

No. UnorganizedKiranasShops

12 mn

Growth rate of Retail Market 15-20%

Growth rate of Online RetailMarket

35%30%Rest

70%Food & Grocery

Market

Total Retail Market $470bn 2011

6%

94%

Organized Retail

Market ($27bn)

Un-Organized Retail

Market ($443bn)

16% Food& Grocery

$4.32bn

Marketing White Book 2011-12


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Indian Organized Retail and Grocery Sales are growing at 18.4%

16.3%

6.1%3.1%

3.1%6.1%

1.0%

2.0%

7.1%7.1%

8.2%

19.4%

2.0%9.2%

9.2%

Share of Categories in organised Retail

F&G

Footwear

Furnishing

Furniture

Pharmacy

Home Improvement

Books And Music

Jewellery andWatches

Nonstore

Restaurant

Apparel

Entertainment

Misc Products

CDITMarketing White Book 2011-12

18.4

12.411.1 10

3 20

Source :India Retail Forum,2010

Grocery Sales Growth Across

Countries (2010) in %

3


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Different Modern Store Formats in India

Hyper Markets

Shopping Malls

Departmental Stores

Super Markets

Online Web StoresModern Formats

90%

10%

Share of Spends

TraditionalFormat

Modern Format

Purchase of..TraditionalFormat Store

ModernFormat Store

Staples, Packed Food Items andother non-foodHousehold products

96% 15%

Perishables-Milk Eggs, Bread,Vegetables, Fruits

99% 6%

4Source: DEssence Research


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Growth Drivers for e- Grocery Market in India

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D

emand

Su

pply

Growing Younger Population

Growing Internet Usage / Online Shoppers

Rising Disposable Income

Increasing Affluence Levels

Quality /Organic Products

Customer Driven And not Investment Driven

Growing e-Commerce Market in India

Multiple Channel Distribution

Flexible Delivery Options

Presence of Major Players

Convenience

Increasing supply of Packaged Grains and food products

Multiple Mode of Payments like Credit Cards, Debit Cards,

Net Banking, Mobile Payments like Airtel Money,

Mosambee (Swipe Credit & Debit Card on Mobile)


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The Hybrid Model

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Wholesale/Imports

LDC Stores

Cross DockingTerminals

Individual Households

B2B

B2C

LocalityLevel

City-City Level

Pan-India

Dairy Meat Bakeries Breweries Others


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Business Models of e-Grocery currently in practice

77

CDT

LDC

LDC 1 LDC 2 LDC 3

CDT

LC D LCD LCD

Manufacturer ImporterWholesaler

Customer

The Operation Model Can Be Divided In Two Approaches:

1. Stock It Yourself Limited Warehouses To Fulfill The Orders.

2. Outsourcing Warehouse Model-using Logistics Specialists Which Do The Work Of Stockpiling And Shipping Web

Stores.

Central

DistributionTerminal

LocalDistributionTerminal

Importer(Wholesaler)

Wholesaler


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Key Indian e-Grocery Players focused on Metro Markets

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Key Players Location

Business

Model Delivery Slots

Minimum

Order for FreeDelivery Funded

Aaramshop.com All India Aggregator 24*7 Rs.500 Yes

Farm2Kitchen.com Delhi Own Supply chainProcessed within 1-3

daysRs. 500 No

MyGrahak.com Delhi NCR Own Supply Chain

48 Hr Delivery & 24*7

Support

No Minimum

Order No

Callandorder.com Mumbai Own Supply chain Next Day Rs 500 No

FreshnDaily.com MumbaiSpecific Localities &

Self Delivery10am to 7pm & NoDelivery on Sunday

Rs. 150 No

Shopveg.in MumbaiSpecific Localities &

Self Delivery Same & Next Day Rs. 200 No

Atmydoorsteps.com Bangalore Own Supply Chain Same & Next Day Rs 500 No

BigBasket.com Bangalore Own Supply Chain Same & Next Day Rs.1000 Yes

Zopnow.com Bangalore Own Supply Chain Everyday Delivery Rs.500 No

VeggiBazaar.com Chennai Own Supply Chain 3pm-9pm, NextBusiness day Rs. 150 No


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Product Portfolio Of Key e-Grocery Players In India

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Key Players Grocery

Fruit&Vegetables

Confectionary

Dairyproducts,Eggs

Organicfood

Non-Veg

Beverages &snacks

Petfood

Homecare

PersonalCare

Toiletries

Aaramshop NA NA NA

Farm2kitchen

MyGrahak NA

Callandorder NA NA

Freshndaily NA NA NA NA NA

Shopveg NA NA NA NA NA NA

Atmydoorsteps NA NA

BigBaskets NA NA NA NA

Zopnow NA NA NA

Veggibazaar NA NA NA NA NA


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International e-Grocery Players

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United States Of America

Amazon.com Americagrocer.com AULSuperstore.com Netgrocer.com ShopfoodEX.com

United Kingdom

Tesco.com

Ucado.com Waitrose.com Foodfullstop.com

Canada

E-Z Grocer.com Canadagrocer.ca Grocerygateway.com

Onlinegrocer.ca Telegrocer.com

Singapore

Singaporegrocerystore.com Egrocy.com Yumtrade.com


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37%63%

11Source: SOGS,india

2461

11 3

5332

11 5

85% of Online Shoppers are between age

of 22 to 45Female Male

38 37 3532 30 30 28

2522 20 20

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Reasons For Purchasing GroceriesOnline

65

40 3832 31

22 20 18 15

Barriers to Purchasing Groceries Online

Whose buying Grocery Online?


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What Motivates Shoppers to Buy Grocery Online?

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Stated Critical Needs The Commitment Drivers

The TraditionalFormat

Shopper

The ModernFormat Shopper

The OnlineShopper

Polite, Courteous Store Staff

Availability of store Staff

Credit Available

Fresh, Quality Services

Reasonability Prices

Trust Level

Aware what a regular customer

wants

Personalized Services

Return /Exchange Policy

Less Impulsive buying

Stick to budget policy

Polite, Courteous Store Staff

Fresh High Quality Stocks

Availability of Latest Products,

brands

Larger shelf display

Bulk buying

Modern Shopping Experience

Discount

Coupons/Promotions/Freebies

Increasing Affluent levels

Convenience Shopping

Already a Online shopper

Grabbing Bargain deals

Use of Credit facilities

Better way of spending

Easy and convenient

Delivery at stated timings


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Key Challenges in the Operating e-Grocery Model

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Solid supplyChain Management

KeyChallenges

Source: Booz and Company Analysis


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Do Investors Think investing in E-grocery is a Good Deal?

E-Grocery companies in India have early-start up advantage. Largely predictable business cycle helps ,even the conservative investors

find the business appealing.

New players coming up with specialty models (like farm2kitchen.com

organised food and organised Products ) which is appealing to customers.

Low Costs and logistics costs is still concern for many.

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DEssence Consulting Services

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DEssence Consulting is a Management Consulting, Business Strategy and M&A

Advisory firm

Build GrowRemain

CompetitiveM&A

Advisory

303, Aar Pee Center, 11th Road, MIDC, Andheri (E), Mumbai- 400093

www.dessenceconsulting.com

+91 22 28347425

[email protected]

Services

Market Entry & Growth Strategy

Business Plans & Financial Projections

Start-up Acceleration Services

Market Assessment

B2B Market/Consumer Insights

Solutions to transform Food and Retail Sector

Access to Capital through our Investor

Network
http://www.dessenceconsulting.com/mailto:[email protected]:[email protected]://www.dessenceconsulting.com/

EGrocery Marketing in India

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