Zomato launches pilot for 45 minutes Grocery Delivery service in some markets, starting from Delhi In NCR July it operates on a marketplace model, allowing its users to order directly from the store. The pilot will conclude on September 17.
According to the email, a copy of which has been seen by ET, the grocery service was moderately successful and faced some challenges, including frequent changes in inventory and lag in order fulfillment, leading to poor customer experience. Fill-rate – the proportion of ordered goods that a platform can actually deliver – is a critical component of an online grocery business.
“At the same time, the express delivery model, with less than 15-minute deliveries and near-perfect fulfillment rates, is gaining a lot of traction with customers and expanding rapidly,” the email read. “We have realized that it is extremely difficult to deliver on such delivery promises in a marketplace model with consistently high fulfillment rates.”
The grocery delivery initiative was overseen by Mohit Gupta, a co-founder, who heads new businesses at Zomato.
The company confirmed the development in a statement. “We have decided To close Our Kirana Pilot and as of now, there are no plans to run any other form of grocery delivery on our platform,” said a Zomato spokesperson. “Grofers has found the high quality product-to-market fit in the 10-minute grocery category and we are confident that our investment in the company will deliver better results for our shareholders than our in-house grocery effort.”
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Zomato re-entered the grocery delivery space this year amid intense competition from hyperlocal delivery platforms such as Reliance Industries-owned JioMart, Tata Group’s BigBasket and Swiggy’s Instamart. zomato
Experimented with grocery delivery for the first time during the nationwide lockdown in 2020, but discontinued it after failing to scale.
Large grocery delivery space and express delivery have seen increased competition
BigBasket planning to start express delivery soon, ET reported in July. swiggy is
Moved Instamart from just two to 11 cities one year ago. Grofers, Instamart, Dunzo and BigBasket are also planning to improve the express delivery model.
ET had reported on May 7 that Zomato
Finalizing $100 million investment in Grofers at a valuation of $1 billion. When Zomato went public last month, it
said the investment in Grofers was purely financial.
In an interview with ET,
Cofounder Deepinder Goyal said“We don’t have much information (about online grocery) and we are just trying to learn. We think it is a big space, but we are not sure whether we want to do it in the long term or not,” Goyal said. “Investing in Grofers is different. We have our own grocery offering which is a marketplace model which went live in Delhi two-three days back.”