Gone are the days, when we would dash to the grocery store or market upon the unexpected arrival of guests. Now we pick up our mobile devices and tap on the delivery app that brings the groceries within minutes. Well, we live in a technologically advanced era, where Q-commerce has emerged as a significant way of shopping for urgent needs like groceries, meals and medicines. The name widens as Quick Commerce, which is a modern evolution of e-commerce that focuses on ultra-fast delivery typically within an hour. The model emerged to meet the growing consumer demand for speed and convenience.
The business model is rapidly gaining traction as people are seeking fast and convenient deliveries for their urgent shopping. Let’s delve deeper into understanding Quick Commerce and how it is helping the FMCG industry.
Is Q-Commerce Emerging as One of the Best Business Models for the FMCG Industry
Q-commerce is conveniently revolutionizing the FMCG industry with its ultra-fast delivery services. Not to forget, technological advancements are leading to a wide acceptance of this business module. Somdutta Singh, Founder and CEO of Assiduus, Angel Investor says, “The Q-commerce market in India is expected to grow at a staggering 77% year-on-year, reaching a market size of $2.8 billion. This explosive growth is driven by the increasing demand for instant gratification, particularly among GenZ and millennial consumers residing in metro areas. As of 2023, Q-commerce’s average monthly transacting users stand at one-third of online food delivery and one-fourth of online mobility, leaving ample room for further expansion. Yes, Q-commerce is rapidly emerging as a transformative business model for FMCG brands. With their ability to deliver everyday essentials within an hour, Q-commerce is redefining the retail landscape.”
Chandra Shekhara Reddy, Sr. Vice President of Sales and Marketing, Gemini Edibles and Fats India Ltd, “For FMCG brands, it offers a powerful channel to enhance accessibility, drive impulse purchases, and cater to last-minute needs. The ability to deliver essentials like cooking oils and grocery items swiftly can create strong brand recall and customer loyalty. In today’s hyper-competitive market, Q-commerce is proving to be one of the most dynamic and consumer-centric business models.”
Is the competition tight among the brands in Q-Commerce?
Yes, the sector is highly competitive, with numerous players vying for market share. The leading players in the industry currently include Zepto, BlinkIt, Dunzo Daily, Swiggy Instamart, and BigBasket.
“To stay ahead in this environment, Q-Commerce companies are investing heavily in technology, logistics, and dark store infrastructure. Dark stores, strategically located micro-fulfillment centers, are crucial for ensuring quick turnaround times from order placement to delivery. Additionally, Q-commerce players are exploring innovative strategies such as crowdsourcing labor and optimizing dark store layouts to enhance their agility and responsiveness.” Somdutta adds.
As more players, including established e-commerce giants, start-ups, and local delivery platforms, enter the market, brands must compete for both visibility and quick fulfillment. Being featured prominently on Q-commerce platforms and ensuring supply chain efficiency are critical to success. P. Chandra Shekhara adds. Brands need to establish strong partnerships with Q-commerce platforms to gain priority in product listings and speedy deliveries. To stand out, FMCG brands must focus on promotional offers, bundling products, and creating exclusive deals on Q-commerce platforms.
Do Only Big FMCG Brands Have What It Takes to Thrive in Q-Commerce?
Well, earlier the big FMCG brands had dominated the market because of their extensive resources but the landscape is evolving over the time. Smaller brands are now deliberately intruding to notice consumer preferences, agility, and sustainable moves to stay ahead of the competition with their bigger counterparts.
Not all companies are equipped to thrive in this model. Explains Somdutta. Sustaining a Q-commerce business requires significant investments in infrastructure, technology, and operational efficiency. Large FMCG conglomerates with deep pockets and extensive distribution networks are better positioned to succeed in the Q-commerce space. These companies have the resources to build a network of dark stores, implement robust quality control measures, and develop streamlined operational processes. Additionally, established FMCG brands can leverage their existing product portfolio and brand recognition to attract customers in the q-commerce market.
While large FMCG brands may have the advantage of scale and resources, Q-commerce offers opportunities for smaller brands too. Agile, niche, and innovative brands can benefit from Q-commerce by leveraging its direct-to-consumer capabilities. Small brands can use Q-commerce to gain quick market penetration without needing massive retail distribution networks. The key is to offer differentiated products and ensure efficient logistics. Digital marketing strategies and partnerships with delivery platforms allow even emerging brands to compete effectively in this model. P. Chandra Shekhara further adds.
Future of Q-Commerce
As per the reports, the sector is expected to grow to $72 billion by 2025. The future of Q-Commerce seems incredibly promising with technological innovations, improved logistics networks and greater consumer demands for faster delivery. The future will also see a dramatic shift in the existence of Q-commerce as a core strategy for retaining consumers specifically in the urban areas. However, how this business model thrives in rural or B or C-class cities is yet to be discovered.
