Reliance Jio’s grocery delivery platform JioMart has started testing subscription-based daily morning deliveries of milk, eggs and bread in select pin codes of Bengaluru and Chennai. The platform had started its operations in December 2019 from Navi Mumbai, Kalyan and Thane in Mumbai.
The subscription-based service can be used through the JioMart app where the customers can place orders online and the product will be delivered from the local kirana store. Users will be asked to set a start date and delivery frequency which can be daily, alternate days, weekly, and monthly. Also, users will have to put their pin code in the app to determine whether it is available in their area or not.
Payments can be done using Google Pay, Paytm, PhonePe, Mobikwik, or JioMoney.
In April, the company had also made its debut on Facebook-owned WhatsApp to allow its customers to place orders through the instant messaging app. For using the service, a user needs to save JioMart’s number 8850008000 on the smartphone and send a ‘Hi’ on WhatsApp. JioMart then sends a link that redirects the users to a webpage where they have to fill details like name and address before proceeding to an online grocery marketplace. The link remains valid for 30 minutes.
The company claims to offer discounts at a minimum of 5% on every product and goes up to a maximum 50% discount.
JioMart currently deals with fruits and vegetables, dairy and bakery, staples, snacks and branded food, personal care products, home care, and baby care products.
According to an ET report, citing sources, the company aims to launch it nationally by Diwali, depending on the results in Bengaluru and Chennai. “This is available in select pin codes in the two cities for now,” a person aware of the matter said.
In terms of diversification, JioMart has reportedly planned its foray into fashion, smartphones and consumer electronics. It may also offer better discounts than rivals Amazon and Flipkart.
At Reliance’s 43rd Annual General Meeting (AGM) in July this year, the company’s chairman Mukesh Ambani had said that JioMart would soon evolve into a full-fledged ecommerce platform, expanding its presence in the fashion and consumer electronics segments, among others.
Reliance Retail raised INR 5,500 Cr from global investment firm KKR in exchange for 1.28% equity stake in the company. Earlier this month, it had raised INR 7,500 Cr from Silver Lake in exchange for a 1.75% stake at a pre-money equity value of INR 4.21 lakh Cr. The company is also said to be in talks to sell a 40% stake worth $20 Bn to ecommerce giant Amazon. Moreover, media reports also suggest that Amazon’s rival Walmart may join in as an investor in Reliance Retail.
Besides, JioMart, traditional grocery delivery platforms BigBasket, Milkbasket. Supr Daily, and Grofers also deal with online groceries.
According to the Inc42 Plus report, the online grocery market is expected to spike to $10.5 Bn, or 1.2% of the overall retail market by 2023. It currently accounts for just 0.2% Enabled by technology, affordability of smartphones, increasing internet penetration and the rising need for convenience in the urban and semi-urban markets, the sector has attracted hundreds of startups that have together raked in over $1.7 Bn from investors from 2011 till June 2020.
The online grocery players saw an uptick in its revenue during the pandemic. Unlike grocery delivery or ecommerce, the crisis showed that the Indian consumer could be forced to buy online without discounts — pay for the convenience factor so to speak.
According to a June 2020 RedSeer report, the GMV in May was up by 45% as compared to January. Further, US-based market research company Forrester Research noted that India’s online grocery market could make $3 Bn in sales this year, representing a whopping 76% hike compared to $1.7 Bn last year. The research firm has attributed this growth to the demand of fresh produce and staples during the nationwide lockdown.