If you’ve spotted brightly-colored delivery riders zipping around town or seen their ads on public transport or online, you’re already familiar with quick commerce. This fast-paced delivery model has rapidly expanded. The pandemic has sparked many changes, and one notable outcome is the rise of ultra-fast, convenience-driven delivery services, also known as on-demand or quick commerce.
Quick commerce offers impulse buys through apps with occasion-based taxonomies, adapting quickly to events like football matches. Marketing often involves bundling items like snacks and drinks for specific occasions. Orders are fulfilled from local stores or micro-fulfillment centers, optimized for speed with AI-powered inventory management to ensure orders are assembled in under three minutes.
Winning in quick commerce means being part of a limited assortment, making it crucial for manufacturers to assess if their products fit. With supply chain-driven rotations, new and local products can gain traction, while convenience bestsellers can capture share by replacing impulse buys in traditional stores.
Based on their economic operations, we can segment Quick Commerce’s business model into two types:
The early pioneers in quick commerce, such as Delivery Hero, Deliveroo, Uber Eats, and Just Eat, originally focused on restaurant delivery. The exception was Gopuff, which was already geared toward quick commerce. While these companies have been around for years, the past two years have seen explosive growth in the sector. Startups are receiving massive venture capital investments, building customer bases, and rapidly transforming affordable real estate into hyper-local micro-fulfillment centers in urban areas.
Consolidations and acquisitions are happening worldwide. For example, Uber acquired Drizly in the US, Turkish company Getir bought UK-based Weezy, and Gorillas, based in Germany, is eyeing France’s Frichti. Additionally, DoorDash now has a stake in Flink. This market is incredibly volatile, with global expansion and market share growth at the forefront of industry priorities.
Quick commerce thrives on its ability to cater to the “now consumer” — individuals who value late-night, urgent deliveries. This demographic is primarily made up of Millennials and Gen Z, often living in small or single-person households due to urbanization. With some disposable income to spare, these consumers are willing to pay a premium for the speed and convenience that quick commerce offers.
The eco-friendly aspect of bicycle deliveries resonates with this group, as does the rapid service. Additionally, the popularity of late-night deliveries points to a younger audience, who prefer the ease of having products delivered directly to their door rather than venturing out once they’re settled in.
As fast delivery technology continues to evolve, both customers and brands stand to gain. Here are a few key advantages of integrating fast delivery into your business:
Faster Delivery & Competitive EdgeOffering deliveries within 15 to 30 minutes provides a smooth, efficient shopping experience that keeps customers coming back. This fast service not only influences customer behavior but also gives your business a competitive edge. Customers looking for quick deliveries are more likely to try new products and explore unfamiliar stores, allowing you to attract a broader audience and stand out from competitors.
Happier Customers & Higher Profit MarginsFast delivery not only enhances the customer experience by making it easier and quicker for people to get what they need but also builds loyalty, increases retention, and encourages word-of-mouth referrals. This service can also drive higher profit margins, as consumers are willing to pay extra for the convenience of on-demand delivery. During the pandemic, sales increased by 50%, and businesses can tap into this trend, particularly for high-demand or limited-quantity products, to maximize profits.
Lower Logistics CostsLocal deliveries reduce shipping costs and offer faster delivery times. By setting up local warehouses and partnering with nearby vendors, businesses can cut logistics expenses and free up resources for other areas of the business.
As more consumers demand lightning-fast deliveries, we’re seeing a shift towards even more localized fulfillment centers, powered by AI and advanced inventory management. In the coming years, we’ll likely see further integration of autonomous delivery methods, from drones to self-driving vehicles, cutting down delivery times even more.
As for the competition, well, it’s going to get more intense. With more players entering the market and consolidations underway, getting the right mix of products and speed will be crucial. So, if you want to stay ahead, it’s time to pedal faster — and I mean that literally; we might just see more deliveries on bikes than ever before.
Read further: News, commerce, ecommerce
