Amazon on Tuesday said it is piloting a quick commerce service in India that will see the U.S. tech giant delivering grocery and other items in 15 minutes or less.
The firm is the sixth major entrant in India’s quick-commerce market, which is currently clocking more than $6 billion in annual sales. Zomato-owned BlinkIt, Swiggy, and Nexus-backed Zepto currently dominate the sector in India, which is operational in roughly two dozen cities.
Amazon said it is initially piloting the service in Bengaluru.
“Our strategy has always focused on ‘Selection, Value and Convenience’ and our vision is to build a large profitable business in India,” said Samir Kumar, the new country manager of Amazon India, in a statement.
“So, while we focus on implementing our strategy to offer the largest selection at fastest speeds and greatest value to customers in every single pin-code across the country, we are excited to start a pilot to give our customers a choice to get their everyday essentials in 15 min or less.”
The quick-commerce model — delivering items to customers within 10 to 15 minutes — hasn’t worked in most parts of the world, but it’s increasingly finding success in India, where a range of retailers and internet firms, from food delivery giant Swiggy to online cosmetics platform Nykaa, are gearing up their supply chain ecosystems to accommodate for faster deliveries.
Myntra, the top fashion e-commerce retailer in India, launched its own pilot of its quick commerce offering in Bengaluru last week. And Flipkart, Amazon’s biggest rival in India, launched its own quick-commerce service in August.
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India is the only market where Amazon is testing the quick-commerce offering. It’s also one of its biggest moves in the world’s second largest internet market.
Amazon entered the Indian market a decade ago, investing more than $7.5 billion to build and scale its e-commerce offering. But 10 years on, the Indian e-commerce market has barely made a dent in the overall $1.1 trillion retail market, growing at less than 15% yearly.
Some industry experts and analysts believe that quick-commerce might be the future of e-commerce in India.
Quick commerce in India is expected to show exponential growth, with projections from investment firm CLSA indicating a sixfold increase between FY24 and FY27, reaching a total addressable market of $27 billion.
Currently representing 3% of the grocery and 1% of the retail market, this segment is expected to expand to 5% and 2%, respectively, within a decade, CLSA said in a report on Tuesday.
Meanwhile, Amazon has been criticized for being too slow in India. Amazon has not been able to capitalize on white spaces across quick-commerce, smaller towns and categories like apparel, Rahul Malhotra, an analyst at Bernstein, told TechCrunch in a recent interview.
