When governments began imposing lockdowns to stop the spread of Covid-19, millions of people found themselves behind closed doors. Sometimes, these periods would last for months at a time. Unsurprisingly, this has had a massive effect on consumer behavior. With the outside world closed off, people turned to instant delivery services online. The already buoyant market saw rapid growth. Key players in the online shopping space made more money than ever. This was surprising, as most businesses saw their profits tumble.
Amazon was the clear winner. For instance, between March and April 2020, they hired 175,000 new staff members to meet demand. However, Amazon’s success is just the tip of the iceberg. Today, people have become used to convenience. Now, the quicker they can get what they want, the better. As a result, the on-demand economy is exploding.
See It, Buy It, Have It
On-demand entertainment services, like Netflix and Disney+, have changed the way people consume TV and Film. These companies grew considerably in 2020 and 2021, as more and more people relied on streaming services for escapism. However, the pandemic led to the growth of other on-demand services, too. Most notably, there was an increase in use of food delivery services.
Meal delivery services have grown massively in recent years. Worldwide revenue in this sector has doubled since 2017. In fact, by 2024, total profits are expected to hit $97 billion dollars. With restaurants closed, food delivery services boomed in the pandemic, and so did grocery delivery apps.
Between February and March 2020, daily downloads of the grocery delivery app, Instacart,
increased by 218%. In addition to. this, Walmart Grocery’s downloads increased by 160%. While Shipt’s increased by 124%. As a result, this growth has led to the development of many more on-demand grocery delivery services. These new players are shattering Instacart’s one-hour delivery promise. And, together, they are ushering in a new era of instant delivery platforms.
The Major Players of Instant Services
Instant delivery services have experienced rapid growth and increasing success. Turkey-based company Getir promises to have groceries at your door within 10-minutes of ordering. In addition to thousands of groceries, Getir offers a wide range of other goods, too. You can order tech accessories, baby products, and even clothing.
Meanwhile, Samokat, the most successful instant grocery delivery service in Russia, is looking to expand to the US. The new company will be called Buyk. The Samokat team has already started their search for storage spaces in New York City. Since 2019, Samokat’s orders have increased 14
times over.
By May 2021, the sector had received close to $5 billion dollars of funding from this year alone. And, the large grocery retailers haven’t ignored this growing trend.
In the UK, Waitrose recently signed a contract with the restaurant delivery service Deliveroo. The two-year partnership enables customers to choose from around 1,000 different products. So, orders are fulfilled using Deliveroo’s existing infrastructure and delivery networks.
However, this massive growth and increasing excitement isn’t just good news for major companies. There will be many opportunities for smaller retailers, suppliers, food producers, and property owners too.
Collaborate for Success
In July 2021, the instant delivery service, JOKR, announced that it had hit $170 million in Series A funding. Now, the company is the fastest growing in the sector with operations in the US, Europe, and Latin America.
Receiving close to $200 million in funding is newsworth. But, what makes JOKR stand out is its business model. Essentially, JOKR has committed to working with local stores to provide local products to local people. This principle is one that could lead to huge growth for satellite businesses and industries.
Instead of working against suppliers, JOKR wants to collaborate with small business owners who can distribute their products through the company’s app. Therefore, this takes away all of the logistical costs that small producers would have to take on if they worked independently.
However, opportunities for growth with JOKR don’t stop at suppliers. The company is committed to working with local property owners to acquire storage space. As they expand, so too will their requirement for real estate.
Farm to Fork in 15 Minutes
JOKR is championing collaboration, but it won’t just be business owners who benefit from the success of the industry. As more companies appear, they will need to stand out from the crowd. At some point, most services will probably be offering the same or similar products. What’s more, the likelihood of delivery times creeping below 10-minutes is small, if not impossible. So, companies
won’t be able to compete on this front either.
Instead, instant delivery companies could look to increasing the quality and range of their products. Organic food producers or farmers that grow unusual crops could work with delivery companies to find easier routes to market. This would enable them to avoid the long and difficult processes of
getting a product on the shelf of a supermarket, for instance.
If the industry grows, instant delivery services will expand the products they offer. This will include a wider range of non-edible products. With this development, manufacturers and suppliers could find an alternative to Amazon. So, this could lead to more rapid sales and lower costs for selling and fulfillment.
Next Steps for Instant Services
Regardless of what happens, one thing is for sure, consumer’s attitudes have shifted. Even after the pandemic, rapid fulfillment will likely become a recipe for success. For many sectors and industries, now is the time to work with, not against, this growing revolution in consumer behaviour.
If you want to take advantage of this emerging economy, there’s no time to lose. The Covid-19 pandemic has laid the foundations for a new type of consumer. Today, retailers, suppliers, and manufacturers are quickly discovering that collaboration is the key to success. In fact, now more than ever, businesses must work together to survive.
Yet, the instant delivery services platform is just one example of the on-demand economy. For many traditional, static companies, the key to longevity will be finding the right partners to grow alongside. In a business landscape where tomorrow is too late, survival will depend on an ability to cultivate a collective vison based on sharing information and resources.
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