Grocery delivery has a PR problem.
We've all heard the experts. They point out the supposed unviability of grocery startups and their severe lack of profits. However, the startups are in no mood to give up. They continue to innovate and are hoping to crack the code to profitability and positive unit economics. The latest bid is the promise of super fast delivery. Store to home in 10 minutes or less. Blimey!
Even with all the attention, the 10-minute delivery model is being characterized as a fad, money-guzzler, and a desperate solution in search of a problem. It is anything but.
Indistinguishable from magic
In fact, if you look closely enough, a 10-minute delivery is indistinguishable from magic. It reminds me of dial-up internet and how a speed of 10 Mbps on broadband was not just high-speed. It was astonishing. People who had internet before others were showing it off like a piece of art.
That's what a 10-minute grocery delivery is. It's not just a slightly faster way of getting goods - it is a paradigm shift that upends our existing belief systems about how fast something can/should be.
It forces us to redraw our mind maps and set new standards.
I can guess that some of us who have used Blinkit/Zepto have found ourselves wondering.
Hey, if Blinkit and Zepto can deliver me asparagus in 10 minutes, why can't Amazon with all its money and drones and rockets get me headphones faster than their one-day delivery?
Yes, I acknowledge one-day delivery is pretty fast. But remember the days when a parcel would take 3-4 working days? It was only a couple of years ago. Now, anything that takes more than a day's time to be delivered makes us reevaluate our buying decision.
Transforming consumer behavior and competitive landscape at the same time
This is what a 10-minute delivery is doing. It's rewiring our brains to expect a 10-minute fulfillment time for everything that lies between the spectrum of carrot to crocin.
It's a matter of time before our expectations expand faster than the SKUs on these apps. Cat food is already available but I am betting that eventually, something as niche and fancy as a Pizza for dogs will make its way to warehouses around the country.
What happens when consumers demand infinitely more categories from an app they like? Hint: A super app
The journey isn't likely to be smooth. There are logistics to be figured, unit economics to be managed and a lot of tough business decisions await the 10-minute grocery startups. These decisions will range from deciding between breadth vs depth for a certain category to figuring out the best strategy to minimize returns, delivery errors, and fleet attrition.
But, the one thing that's going for them is the most important thing indeed.
Building addiction - one delivery at a time
It's the consumer's perceived lack of time, a cohort of high-income users, and their propensity for addiction to things that sell luxury or convenience.
Be it high-speed internet or bottomless social media feed, the human mind has a knack for attaching itself to instant gratification and rewards.
I would go even further to say that the 10-minute delivery is closer to metaverse than we think. A virtual environment gives us physical rewards at our doorstep without the wait. 10 minutes might seem long but in reality, it's faster than one would think. One distraction, one chore, one scroll through Spotify to play that perfect playlist....*ding dong*.
Lots of people might wonder at this point why 10-minute is a paradigm shift while 15-30 minutes or even a 1-hour delivery offered by the industry incumbents is not.
The reason is the same as why there are more than a dozen equally fast browsers out there built on the same technology but Chrome and Firefox win out. - it's not because of their raw speed, it's because of the story and promise. We don't necessarily want the fastest browser, we want the fastest looking and most up-to-date browser that has the least bugs so the experience feels smooth and fast.
That's what the 10-minute grocery delivery is doing. It's telling us a story we can't fully comprehend rationally but our emotional and irrational brains love it.
Copy-cat is not equal to a fad
We love the gratification but we also like the puzzle of logistics that's beyond comprehension. Like children pressing a red button over and over again even though it brings the same sound out of the toy. Or ordering from Domino's when you need pizza fast even if a pizzeria is in the next street and offers doorstep delivery.
Finally, for something to be a fad, it has to have:
Superfast adoption
Wide-spread attention
Short lifespan
A 10-minute grocery is doing the opposite. It's not logistically possible for the model to expand recklessly because of unique issues around everything from sourcing to fulfillment in every region. It's getting a lot of press and adoption from urban millennials but it's yet to reach a critical mass when it becomes the accepted norm. And boring.
While the lifespan of a 10-minute delivery model cannot be predicted, it's pretty clear that it is unlikely to die anytime soon.
The Lindy Effect proposes that something that has been around for 100 years will probably be around in another 100 years but something that has survived only six months could perish before the next six months. The effect doesn't give 10-minute grocery delivery a lot of credit yet but with every passing day, the lifespan increases.
At the same time, the longer it stays, the harder will it be for the incumbents to not do it.
It might not make money yet but for a very short period of time, the 10-minute delivery model will offer a company or two the opportunity to forever brand their name in the minds of their consumers. At the same time, they'll force an entire list of industries to follow suit.
Like Amazon did with Prime. In the US, the number of people with Amazon Prime subscriptions is more than those who have television sets.
The current grocery startups might not all become Amazon just on the basis of their delivery speed but there's a field wide open to them to continue building on this and find ways to not just monetize but also diversify and create a sustainable long-term business.
In the near future, delivery speed in itself may not predict success for a company but it'll become extremely hard to forgive a lack of speed and reliability. (Flipkart, are you listening?)
That, to me, sounds like a win.