Quick-commerce business Zepto has launched its paid subscription service called Zepto Pass. While customers enjoy the discounts, it beefs up competition in India’s growing e-commerce market.
According to the Times of India, the benefits can be unlocked only when customers place orders of $1.20 and more. Zepto Pass has grown by over one million members in the first week since its launch.
Why does this matter? Instant groceries are a convenient way to be more productive in a world spinning faster and faster. While customers are demanding more delivery options at home, faster and more convenient, the competition is tightening.
Economic Times reports that the quick-commerce sector in India might see an escalation into a much “wider array of stock-keeping units (SKU).” This can potentially see it come closer to e-commerce in the future. In a post on LinkedIn, the founder of investment firm Glade Brook Capital says the market is already moving in this direction.
How quick-commerce is shifting with paid subscription
Zepto Pass is in a piloting process, with the company already noticing a massive uptake and positive response to the campaign.
The e-commerce firm says those who subscribed to the program already spent 30% more on the app. They’ve already seen a 30% increase in monthly retention, says the Times of India.
It all makes sense when the subscription is affordable, carries value, and benefits those who are part of the so-called elite club. Zepto is currently offering free deliveries and 20% off on grocery items.
From a marketing perspective, the goal is to lure as many customers as possible who are not convinced that the quick-commerce strategy is worth their dollar.
Many quick-commerce companies popped up worldwide during the COVID-19 pandemic. Ironically, as lockdowns started easing, many companies collapsed. Only a few managed to change their strategy and keep their doors open.
Zepto promises to deliver groceries within 10 minutes throughout its dark stores nationwide.
Balancing reliability and speed
A study by McKinsey and Company shows speed is not everything to some customers who prioritize reliability. “In fact, the variety of delivery options and the perceived quality of the delivery service are major decision-making criteria for online customers,” found researchers.
However, the report also highlights the importance of various delivery options. “The variety of delivery options and the perceived quality of the delivery service are major decision-making criteria for online customers.”
Why ultra-deliveries are still surviving
As good as it might sound to get deliveries to customers’ doors at ultra-speed, it’s a complex process. That’s probably also why many companies like Joker, Buyk, Fridge No More, and Milk Run closed in 2021.
Locate2u’s CEO, Steve Orenstein, believes although it’s seen as a service for the elite, there’s still a need for this type of delivery. Orenstein recently released a book called Delivery, addressing this question.
“I think it’s clever that someone like Woolworths acquired the Milk Run (Australia) brand. Woolworths has lots of stores, and those stores are very close to where the consumers are.”
While many argue there could be a slowdown in quick-commerce, experts are warning that subscription services like Zepto Pass could reignite the competition in this industry.
About the author
Mia is a multi-award-winning journalist. She has more than 14 years of experience in mainstream media. She's covered many historic moments that happened in Africa and internationally. She has a strong focus on human interest stories, to bring her readers and viewers closer to the topics at hand. Do you have a story you would like her to expose, report on, or consider? Please send your request to Newsdesk@locate2u.com.
