10-minute delivery, value meals: How Swiggy is planning to grow
What's the story
Swiggy, one of India's leading food delivery platforms, is changing its strategy to boost growth in a slowing market.
The company's CEO for Food Marketplace, Rohit Kapoor, said to The Economic Times that future growth shall come from low-frequency users and category innovation.
He emphasized the need to expand into delivery-friendly categories (10-minute deliveries) and target these low-frequency users with value options.
Service
10-minute delivery service: A game changer
Swiggy is focusing on its 10-minute delivery service, Bolt.
The company aggregates restaurants that offer quick delivery and has seen this segment contribute to 12% of its food delivery volumes.
Kapoor said, "Quick commerce has shown that anything you deliver fast has legs... If you look at food, it is as close to an immediate craving that you can ever have from a consumer standpoint."
Strategy
Value offerings and market penetration
Swiggy has also launched value offerings for students and junior-level corporate workers.
Kapoor said the growth won't come from high-frequency users ordering more but from 'new-to-category' consumers or low-frequency consumers.
He claimed that even in major metros like Delhi-NCR or Bengaluru, the penetration levels do not come close to global benchmarks.
This is not just about food delivery; it reflects a gap across the entire food ecosystem.
Problems
Swiggy's supply-side challenges
Kapoor said there's a lot of room for growth in the food delivery market. He stressed that the real problem lies on the supply side, not demand.
"It often appears to be a consumer problem because consumption trends and income data are easily tracked, but the supply constraints are far less visible," he explained.
Challenges
More restaurants needed
Kapoor stressed the need for more restaurants to open to meet the growing demand for food delivery.
However, he also acknowledged that opening a restaurant is structurally very hard due to local constraints.
He said, "There are debates and discussions over commissions, while on the other, operation of cloud kitchens has become much more viable."