Future Group is launching an app that will target the daily/weekly needs of consumers for groceries and will compete with similar online firms such as Grofers and BigBasket.
India’s biggest retailer, Future Group is designing the app for Easyday members on the lines of how Amazon Prime works on the basis of an annual paid subscription. According to Vinay Bhatia, CEO (group loyalty and analytics), Future Group, using a central warehouse to deliver fresh produce, i.e., fruits and vegetables, to customers’ houses is not possible. Instead, the firm plans on using neighbouring stores to provide the delivery services.
At present, partner stores are serviceable within 2km to 2.5km radius. The retailer plans on increasing this distance drastically. Future Group currently holds around 950 stores in its network. It is targeting 10,000 stores by the year 2022.
Customers will be able to subscribe to Easyday club membership at Rs.999 per year. They will be entitled to 10% discount on the purchases they make on the app.
In the Indian market today, food and groceries account for close to 50% of the total retail basket. The online penetration of this market is not even 1%. Therefore, there is potential for high growth in this sector. Morgan Stanley expects the online penetration of the grocery and food delivery market to touch 4% by the year 2020. It is also expected that the gross merchandise (GMV) will reach $19 billion (approximately Rs.1.2 lakh crore). This will make the sector the largest among online categories after electronics and apparel.