Table of Contents
Build a platform and prepare for the unexpected; and you’ll know you are successful when the platform you’ve built serves you in unexpected ways.
1. Introduction
When was the last time you or your family member bought something online? It wouldn’t be too long ago. Right? The answer to this limpidly defines the widespread impact of ecommerce on people inhabiting various geographical regions.
Literally all of us, barring a handful few, have somewhere or sometime been involved in making online purchases because of one reason or the other. This online buying trend has grown among the masses by leaps and bounds, lately. But there has been less inquisitiveness about it as to what is making it so desperately demanded by a whopping score of population, and that too at an unbelievably quick pace.
In this era of ecommerce, technology intensive businesses and quick deliveries rule the roost. The galloping smartphone adoption rate, increasing internet penetration, high smartphone adoption and growing sedentary lifestyles have all contributed heavily to the transformation of ecommerce to hyperlocal ecommerce. So, to say so, we are living in an age of quick commerce that demands ultra-fast deliveries. In order to meet such needs and demands, ecommerce has made way for a more refined, digitalized and automated model, which has come to be popularly known as hyperlocal ecommerce. And as a matter of fact, hyperlocal ecommerce has dramatically changed the way brands now reach out to their customers, making it faster and easier for them to make purchases on the fly or in transit, while avoiding the hassles of facing clogged traffic or going to the store.
2. Why Is Ecommerce Growing So Fast?
The rapid adoption of smartphones, easy and affordable access to technology, and the convenience of shopping from anywhere, at any time are the major reasons for the rapid growth of ecommerce. Attribute it to ecommerce, online marketplaces have been on the rise since the mid-1990s with the launch of giants we know today, such as Amazon, Alibaba among others. Amazon in particular is known for its unique growth strategy that has helped them achieve mass-adoption and record-breaking sales.
3. How Fast Did It Grow During Covid-19?
The Covid-19 global ecommerce surge was initially born out of necessity. Online shopping provided a practical alternative as retail locations closed and people stayed indoors to avoid the virus spread. In fact, the dramatic rise in ecommerce amid movement restrictions induced by Covid-19 increased online retail sales’ share of total retail sales from 16% to 19% in 2020, according to estimates in an UNCTAD report.
All in all, for so many reasons discussed above, ecommerce has been moving steadily and has gained immense pace during covid-19. Expected fast delivery of products and reduced operational costs for businesses remain at the heart of such ecommerce activities which has perhaps led us to hyperlocal ecommerce.
In short, ecommerce is gradually becoming a thing of past and has taken a backseat, while hyperlocal ecommerce, leading from the front, has pretty convincingly caught up with the pace of growing contemporary demands as it endeavours and continues to serve and satisfy hyperlocal needs.
4. What Is Hyperlocal Ecommerce And Its Marketplace?
The word ‘hyperlocal’ means going local in your business. Hyperlocal ecommerce is a form of business that focusses on the needs of geographically local consumers. Hyperlocal businesses focus on geographically nearby consumers for fulfilling their on-demand needs usually through a website or mobile app or any online platform including social media. Like Amazon or Flipkart, a hyperlocal ecommerce marketplace is an ecommerce delivery solution for a localized or small geographic zone. Advantageous as it is, setting up a hyperlocal ecommerce marketplace is an erupting business idea and it is making businesses around the globe go gaga over it.
Read more about What is Hyperlocal Ecommerce?
5. What Is A Hyperlocal Delivery Model?
A hyperlocal delivery model is an online business model in which the on-demand needs of customers are met through local offline shops via a digital platform. The model focusses on increased automation and geographical proximity of the buyers and the vendors in order to achieve maximum ordering and delivery efficiencies. It is pertinent to note here that the hyperlocal model enables the brands to reach out to their target customers directly, removing the middlemen, etc as part of the traditional business model. This provides customers with a better shopping experience as it offers convenience and quick delivery, especially in the areas of logistics, food and groceries.
6. The Hyperlocal Discourse
Hyperlocal ecommerce has been one of the most talked about concepts in the recent past; and hyperlocal ecommerce players, with their agile and customized delivery options, have caught the eye of discerning consumers. Delivering almost all sorts of products and services like food, groceries, apparels, home care, personal care, accessories, etc, hyperlocal ecommerce has just not been able to provide services at the doorstep of the customers, but it has also infused a new lease of life in several ailing and floundering businesses, and has empowered them considerably.
The hyperlocal space has seen a tremendous rise in the number of niche brands across categories like home décor and essentials, home services, groceries, and pharmaceutical sectors. As the markets have witnessed more growth lately, traditional brands have shifted their focus towards hyperlocal and direct-to-consumer business models. This transition has been accelerated further due to increased internet usage and evolved consumer behaviour.
So, the evolution of hyperlocal ecommerce is not individualistic in nature. In fact, it is mutual- implying, it is the evolving consumer behavior, need for urbanization and growing technological intervention that is pushing businesses towards the hyperlocal space.
Ramping up the pace of hyperlocal ecommerce and much to the delight of aspiring hyperlocal businesses, covid-19 struck in 2020. During the pandemic, the hyperlocal ecommerce space became the most sought-after destination for businesses and consumers alike, as restrictions and quarantines meant delays and logistical nightmares, especially for the sellers. With the covid outbreak and strict social distancing norms put in place, customers found physical shopping difficult. What instead they found easy was to resort to online shopping through websites and applications to even buy their basic necessity items. Moreover, several individuals who had children and old-age people found online shopping a safer option to get their daily essentials. In addition to that, the cashless and contactless features of online shopping led to nearly every household opting for online shopping.
The sudden surge in the popularity of scores of businesses can undoubtedly be attributed to the pandemic that has pushed each and every vertical of every industry to shift and adapt to the digital medium. It would be rational to point out that the period after covid-19 has seen an exponential rise in the use of hyperlocal platforms and deliveries. Courtesy to the pandemic and other lifestyle changes, the delivery apps have become extremely popular and in order to avoid crowds, people are willing to take advantage of food and grocery home delivery services.
How apt is the saying that every crisis situation presents an opportunity to try something new?
And, how wise are businesses to have turned hyperlocal seeing opportune times in the pandemic or the changing habits of consumers, for that matter?
7. Factors Contributing To The Hyperlocal Growth
Let us see a few factors that have contributed significantly to the growth of hyperlocal ecommerce.
- The Pandemic- With a surge in covid-19 cases, business activities came to a standstill. Back then, people started to explore of options to satisfy their needs and started to buy things online and sellers too chose to make them satisfied by catering to them. This was a required push for hyperlocal ecommerce. Since then, as almost everything is being bought online now, it is for us to see how tremendously hyperlocal ecommerce has evolved.
- Ingression of technology- Technology has pronounced many a business’s decisions and going hyperlocal is one of it. Seeing the impact technology was making and the way people were getting used to internet and social media like services, businesses found a quick refuge in hyperlocal ecommerce. This has led to them growing immensely in the recent few years.
- High smartphone adoption rate- With global smartphone adoption rate estimated to have reached over 78 percent in 2020, prudent businesses saw it all coming. With smartphones in every hand and the users having access to internet and social media, businesses have quite successfully made the most of this opportunity by coming onboard a hyperlocal marketplace. They have made quick bucks as consumers have frequented hyperlocal platforms for satisfying their food cravings and meeting daily essential needs, etc more often than ever.
- Business mechanization- Businesses learning to adopt technology and getting mechanised is one solid reason why hyperlocal ecommerce has flourished. Businesses capable of adopting technology have successfully done so, and have made their processes highly mechanized and automated. It is this automation that has made drone deliveries among other features become a possibility; and hence the hyperlocal growth.
Let us see a few factors that have contributed significantly to the growth of hyperlocal ecommerce.
- The number of hyperlocal commerce shoppers will increase by 52% to reach 214 million by the end of 2022.
- The hyperlocal delivery industry was worth $1,324 billion in 2019 and is expected to grow to $3,634 billion by 2027, with a CAGR of 17.9% throughout that time.
- The global hyperlocal service market size was valued at $1714.60 billion in 2020, and is projected to reach $5188.60 billion by 2030, growing at a CAGR of 14.9% from 2021 to 2030.
- According to India brand equity foundation, the Indian e-commerce market is expected to grow to $200 billion by 2026 from $38.5 billion as of 2017.
- The software powered robotics market in logistics is expected to reach $15.58 billion by 2026.
8. Reasons That Are Making Hyperlocal Ecommerce Go Boom
- The hyperlocal e-commerce marketplace is a blessing for several local offline retailers and service providers. Hyperlocal e-commerce helps local store owners to take their business to its next growth phase.
2. Hyperlocal e-commerce gives customers a much better shopping experience. They get to shop products from the comfort of their homes without having to pay extra shipping fees and get the product delivered at a lesser price.
3. In a fast-paced world of ultra-fast deliveries, consumers are preferring to stay at home and order their things of need. Through the hyperlocal model, they get quick and safe deliveries of products and they are saved from the hassles of going out and shopping.
4. Hyperlocal ecommerce advocates the concept of automatic instant delivery. i.e. deliveries at unbelievably fast pace. Since hyperlocal businesses operate only within a particular geographical area, it helps the businesses attend to the needs of their customers in a quick and efficient manner. Automatic instant delivery mechanism has turned out to be one of the major features of hyperlocal ecommerce and has contributed to its increasing popularity.
5. Last but not the least, it enables hyperlocal businesses to increase sales and ramp up their revenue in a shorter time frame as they have an increased visibility and more chances of presenting their products online, in front of their customers.
9. Future Of Hyperlocal Ecommerce
Given the trend of evolution and pace of growth of hyperlocal ecommerce, the future appears to be highly promising. Business areas and industries that are left untouched till now can be made to go hyperlocal. Seeing the hyperlocal ecommerce space blossoming, several hyperlocal retail businesses may diversify from one category of business to another over the hyperlocal ecommerce marketplace platforms.
Additionally, hyperlocal ecommerce, the way it has been galloping, is certain to grow beyond the urban regions and foray into more specific rural areas and also tier II and tier III cities that have till now been incompletely or partially served.
Moreover, as the impending technology gets more dominant over how businesses are run, it is expected that they will turn highly automated, thereby introducing things like advanced robotics and AI-inspired trials for products that really need to be tried, for instance apparels, accessories, etc. Perhaps, there are a few tech businesses that are in the nascent phase of doing it. In all possibility, they are going to come upfront soon and will become increasingly prominent.
Last but not the least, hyperlocal ecommerce, backed by superb and state of the art technology, is highly likely to introduce drone deliveries on a large scale. It just remains to be seen how soon will that happen.
Also, advancements in technologies like AI, blockchain and big data provide an inducement to the commerce sector to adapt to hyperlocal. Deliveries continue to become speedier and hassle-free, permeating the shopping experience with the traditional warmth and familiarity of visiting neighbourhood stores while doing so from the comfort of your couch.
The way forward to ace the hyperlocal space is to get on board with intelligent and futuristic SaaS platforms. The coordination between multi-point picks ups and places of delivery while nailing end-to-end visibility is only possible with SaaS.
10. Winding Up
Having discussed the factors and reasons behind the phenomenal growth of hyperlocal ecommerce and the prospects that lie ahead for hyperlocal businesses, one thing that can be established for sure is, we will continue to see a convergence of the digital and physical world, and those who conquer that trend will be the market leaders.
Hyperlocal ecommerce certainly offers both convenience and efficiency to the business and the consumer. The need for instant gratification when it comes to shopping, lightning-fast fulfilment and delivery and tech-savvy revolutions like geofencing and automatic instant delivery features are driving the ecommerce sector into hyper localism, solving key challenges like optimum route planning, managing peak hours, order consolidation, multi-point pick up, etc.
With more technological advancements, as hyperlocal ecommerce is destined to get more time and cost efficient, it will surely become fierce and competitive.
The hyperlocal ecommerce market is estimated to record ground-breaking growth in the years to arrive. To maximize and optimize operations, businesses must come up with ideas that help them re-brand and re-invent themselves so as to stand out and differentiated and reach a wider audience.
In order for that to happen, businesses must ‘evolve’ hyper locally.
