Indian online grocery market can exceed USD 3 bn sales in 2020: Goenka
Consumers opted to buy essentials and other products from home in a bigger way than they had done in the past,Spencer’s Retail Chairman Sanjiv Goenka said.Updated: Jul 12, 2020 18:21 IST
The Indian online grocery market could exceed sales of USD 3 billion (about Rs 22,500 crore) in 2020, a substantial 76 per cent jump over the previous year, Spencer’s Retail Chairman Sanjiv Goenka said.
The preference for online delivery of products became more visible following the Covid-19 outbreak, he added. Spencer’s Retail, part of the RP-Sanjiv Goenka (RPSG) Group, had acquired online supermarket and grocery store Nature’s Basket in July 2019.
Consumers opted to buy essentials and other products from home in a bigger way than they had done in the past, he said.
“The result is that India’s online grocery market could exceed USD 3 billion in sales in 2020, a substantial 76 per cent increase over the previous year following a demand spike for the home delivery of fresh produce,” Goenka said in his address to shareholders in the company’s Annual Report for 2019-20.
With increased access to smartphones and low data costs, shoppers now prefer an omni-channel shopping experience, he added.
Spencers Retail is attractively positioned to capitalise on the omni-channel opportunity, he said.
“The company did not just respond to this sectoral inflexion point with a relevant mobile application and home delivery; it invested in enhancing proximity to consumers through phone call-based delivery, Chatbots and WhatsApp-driven product delivery using its stores as hubs,” Goenka said.
Besides, the retail chain collaborated with Uber and other delivery partners for product supply, strengthening its last-mile capability.
According to Spencer’s Retail CEO Devendra Chawla, the company’s online business experienced a milestone in FY20 where it not only consistently scaled the number of monthly active users but also positively turned around its unit-level economics.
“Our unit-level economics grew 45 per cent with a substantial increase of 125 per cent in our registered customer base. On the overall, the number of orders grew 175 per cent, which helped us significantly moderate delivery costs,” he said.
During the Covid-19 pandemic, the company operated 90 per cent of its stores across the country “We will accelerate our transformation and deepen our relevance,” said Goenka.
“We believe that our competitiveness will be derived from omni-channel consumer access, judicious store rollout, distinctive positioning in the minds of our consumers, a balance of lifestyle and essential products, a shift towards nonfood & apparel in the product mix.” Headquartered in Kolkata, Spencer’s Retail operates 191 stores (including Nature’s Basket) of various formats in 42 cities.
Spencer’s Retail posted a revenue of Rs 2,373.29 crore in FY 2019-20.