Grofers, BigBasket see rise in non-metro users

BENGALURU: Consumers in smaller cities and towns are increasingly using online grocery delivery services and are shopping for higher-value basksizes compared to the top seven cities, at least six companies in the sector told ET.A fear of the Covid-19 pandemic as well as closure of many physical stores, coupled with non-availability of items in corner stores, is leading to the shift in consumer buying patterns, they said. Cities such as Jaipur, Ahmedabad, Indore, Trichy, Salem, among others, are witness to the trend, they pointed out. "Tier-II cities grew by 56% in April compared to March while metros grew about 35%," said Hari Menon, co-founder of BigBasket.Menon, though, clarified that the spike was not because of a lower base but due to the availability of manpower and built-in infrastructure capacity at these cities to fulfill additional orders.Rival Grofers, too, said it was able to retain 62% of users who came on board in March after the nationwide lockdown, adding it expects to retain around 50% of new users in the long term. "Today, the adoption of online grocery is happening via environmental forces, and we believe that this trend is going to stay as a large number of consumers who shopped during the lockdown have already transitioned towards online grocery shopping," said Albinder Dhindsa, cofounder of Grofers.At least half a dozen national and regional startups, like Swiggy, Zomato, Shopkirana, Dealshare and Shopmatic shared the sentiment.Swiggy, which scaled its grocery delivery to 300 cities in two months, said order value in small towns tends to be higher compared to metros. "We have noticed a higher average order value, or AOV, of 7-10% from the smaller cities," a Swiggy spokesperson said.Some part of this increased usage is driven by striking close partnerships with local governments. "We worked closely with various local officials from different cities because, after the lockdown, we had to get passes and licences to arrange supply for these kirana (corner) stores," said Sumit Ghorawa, cofounder of ShopKirana.

from Economic Times https://ift.tt/3cjGSpS