Swiggy Ends Grocery Marketplace Experiment As Focus Turns To Dark Stores
- Swiggy’s grocery delivery service ‘Swiggy Stores’ connected consumers to nearby stores for groceries and other essentials
- Swiggy’s Instamart will operate a chain of dark stores to service hyperlocal grocery demand
- Swiggy plans to scale up Instamart from Bengaluru and Gurugram to multiple cities to challenge the bigger online grocery startups
Bengaluru-headquartered foodtech unicorn Swiggy has reportedly shut down its online grocery marketplace and plans to replace it with ‘Instamart’, an instant delivery service for groceries and other household items, fulfilled through a network of dark stores.
In August last year, it was reported that Swiggy was piloting Instamart in Gurugram.
“Through Instamart, we want to introduce the convenience grocery category in India. With the fastest deliveries in the segment (30 – 45 minutes), day and night serviceability (7 am – 12 midnight), a wide assortment across categories such as instant meals, snacks, ice creams, beverages, fruits and vegetables, Instamart will address the unmet grocery needs of the time-pressed, convenience-seeking urban consumer,” a Swiggy spokesperson had told Inc42.
While Swiggy’s grocery delivery service named ‘Swiggy Stores’ was a hyperlocal delivery service for groceries and other essentials, Instamart will see the company operate a chain of dark stores to service consumer demand. The advent of dark stores is a trend that has created a dilemma for online grocery startups as it does offer some benefits over partnering with kirana stores, but also requires a larger upfront investment, as seen in our detailed look at the model — The Hyperlocal Conundrum: Kiranas Vs Dark Stores In India’s Retail Market Post-Covid.
According to Entrackr, which first reported the development, Swiggy plans to scale up Instamart, currently available in Bengaluru and Gurugram, as it offers better margins compared to the marketplace one. The company plans to expand Instamart to multiple cities to challenge the bigger players in the grocery delivery segment such as Bigbasket, Reliance-owned JioMart, Grofers, Flipkart SuperMart, Amazon Fresh among others.