Amazon announced Monday that it had expanded its grocery delivery service called Amazon Food to 62 postcodes in Bangalore. This is the first public update since entering the new category in India last May.
The American e-commerce group said Amazon Food is now reaching key locations in Bangalore such as Whitefield, HSR, Sarjapur, Koramangala, Indiranagar, MG Road, Jayanagar, JP Nagar, Frazer Town, Malleshwaram, Rajajinagar and Vijayanaga.
At the time of launch in May last year, Amazon Food was available in just four zip codes in Bangalore.
While Amazon Food continues to be limited to a key market in India, the company is aggressively trying to undercut its competition – heavily funded startups Zomato and Swiggy – in the city.
Grocery delivery is free for Prime members, while others pay a 19 Indian rupee (26 cents) fee – cheaper than the fees charged by Swiggy and Zomato.
The company, which has pledged to invest $ 6.5 billion in its operations in India, has amassed 2,5000 restaurants and cloud kitchens – also known as Bengaluru – in Bangalore. Amazon Food customers can enjoy “deals” from these restaurants as well as cashbacks from Amazon, the company said.
However, it was not disclosed why it was unusually slow with Amazon Food’s expansion in the country.
(Well, I mean, there is a global pandemic – but Amazon is also making a number of bets that its staff refer to as “one-way door” and “two-way door” bets. Two-way door bets are ones that the company doesn’t have I’m totally determined and just trying to test the water before making a specific decision. Think of Amazon Prime as a one-way door bet, so it’s not clear from day one how much Amazon is committed to a new service.)
“As Amazon Food expands in Bengaluru, we continue to strive to provide unmatched convenience and value while being part of their everyday lives. Amazon Food has some of the best restaurants in town, including national outlets and local favorites that are popular and follow strict delivery and safety protocols, ”said Sameer Khetarpal, director of category management at Amazon India, in a statement.
Ant Financial-Backed Zomato and Prosus Ventures-Backed Swiggy have established a duopoly in the Indian grocery delivery market. Bank of America analysts estimate their combined market share to be over 90%. (Uber left the Indian grocery delivery market early last year after selling its local grocery store to Zomato.)
Amazon Food’s expansion also comes at a time when Zomato, which analysts say is the market leader, is preparing to go public.
The Indian grocery delivery market is particularly difficult to crack due to local conditions. Unlike in developed markets like the United States, where the value of each delivery item is around $ 33, a similar item in India is priced at around $ 4, according to research firms. Both Zomato and Swiggy have significantly improved their unit economies over the past year.