Impact of Covid on Grocery eCommerce
The most evident impact of COVID is a spike in the number of users. The fear of COVID is moving people online, as it is more safe and convenient.
While this has been positive, bbdaily has faced a huge amount of manpower issues.
“..grocery business is not just an online tech business, there are backend processes, warehouse operations, last-mile delivery..“ Deepti Sarma, 11:15
As people started coming online, it increased traffic to their app, and corresponding order and back end processes collapsed. Despite having some amount of a buffer for scale at a product and tech level, this impact was unimaginable and affected the slots system.
“.. even if the slots get opened they would get closed within five minutes so that became like a lottery system so to say and so we had to come up with you know short-term mitigations for it like a reactive measure to take..” Deepti Sarma, 12:15
The team had to work with a limited number of pickers and delivery boys but large customer base,
“..we had to figure out how to do more with less..” Deepti Sarma, 12:40
Being in the essential service category, bbdaily made sure they reached the maximum number of customers within their capabilities and limitations.
Another important element was the ground fleet, delivery boys. Most of the migrant workers started moving back to their hometowns and that had its impact on the whole operations and supply chain management.
One of the immediate things bbdaily adopted was the COVID-Insurance.
“..whether you are a contract employee or a permanent employee with our fleet, we made sure that you were insured with the COVID-Insurance..” Deepti Sarma, 14:30
In addition to this, the team members, warehouse employees, last-mile delivery boys were trained by health managers and officials. Apart from the norms given by the government, bbdaily followed additional norms that included sanitization of vans and warehouses, delivery boys would use disposable gloves, and so on.
“..there were a lot of additional checks that we put in place to ensure both our delivery personnel and our customers can stay away from the virus ..” Deepti Sarma, 15:40
As most companies have started to build towards the ‘contactless delivery’ concept, bbdaily was always contactless.
Being a subscription service, customers could place an order at 10:00 p.m. in the night and could get the order delivered as early as 5:00 a.m. and because it's at an early morning slot, the items would be delivered in a bbdaily bag that the customer hangs outside their apartment.
In addition to this, bbdaily also ensured to avoid any transaction with cash.
Due to manpower issues that bbdaily was facing, they had to innovate and improve their warehouse operations in order to pick more orders with the given set of people and also to not exhaust them with work hours.
The product had to evolve to cater to different warehouses in different cities operating at different times because of government restrictions. Certain apartments in certain communities did not allow any deliveries and certain roads were completely blocked because of red zones and other government restrictions, hence the product had to reflect these changes and became very area specific.
The bbdaily team brought in that flexibility to their tech and product by adding in more configurations so the delivery guys would be able to do their job easily.Their engineering team has been working tirelessly in a distributed manner to make sure every team can handle a particular function of the product. Their key has been in prioritizing tasks.
Even though there are a lot of small players entering the business, because of the huge increase in the demand there is no dearth of customers and their loyalty.
“..we basically ensure that our loyal customers and our star customers are getting their right slots and are getting good deliveries..” Deepti Sarma, 20:20
Despite bbdaily scaling up to around 60% increase in orders from February to March, they were focussed on meeting the needs of and satisfying existing customers.
“..there's only so much that you can scale at a given time without hampering customer experience so we didn't want to take in everything that was coming in but we want to just make sure that whatever is coming in and whatever we are able to service - we do a great job..” Deepti Sarma, 20:47
bbdaily made sure that the number of push notifications that their users received was more relevant in terms of the situation and the possibilities versus promotions and discounts.
They have updated their safety measures in the supply chain by being particular about the cleanliness and quality of the products being brought in from the farmers, additional checks in warehouses and hubs and the same safety measures are communicated to the customers with relevant slot opportunities in order to balance out the traffic and the capacity constraints over the whole end-to-end process.
Having an insight on user behavior, bbdaily has noticed that customers are keen on getting their product and having availability in terms of stock and the slot instead of being worried about discounts as they have removed unnecessary discounts and instead used that budget on the service and bringing more people to manage the operational capacity.
“…we go through the process of thermal scanners and sensing the temperature and figuring out if they have any symptoms, we also have doctors on call and people doing a little bit of deeper checks and ensuring to see that the workforce that is in today is healthy..” Deepti Sarma, 31:30
About new customers, there has been an increase in customers from tier 2 cities, a lot of elder population, and bachelors who are not living in their hometowns but stuck in their place of work.
“..who basically believed in the touch-and-feel form of shopping, where you want to see the fruits and smell your mango, I see a lot of those coming onto the online platform..” Deepti Sarma, 33:46
Customers used to buy based on their needs. There are customers who like to plan their meals and would probably buy three times a month whereas most Indian families don't really plan their groceries hence order about four times a week.
Since bbdaily is subscription-based, most customers get milk products regularly and add in some essentials to their order which would happen about fifteen times a month.
“..it was purely based on their consumption basis and the family size and what brands they preferred..” Deepti Sarma, 36:00
Due to the fear and lack of availability of slots, customers started to order staples like rice and pulses. The consumption of milk within the same customer base went up really went up by 30% and fruits and vegetables went up by 40%.
They also noticed their Customers buying bigger packs and not in preference to a particular brand.
Users would also look forward to replacements instead of refunds,
“..it was more about essentials and you know, getting their basic needs met..” Deepti Sarma, 37:05
Market & Competitors
As the market is large, it seems impossible for one company to be able to cater to everyone as it is a huge amount of operational and warehouse management in addition to tech and logistics.
Despite wanting to acquire more customers, bbdaily is focussed on having good service to their exisiting customer base.
“..giving the right experience to customers really actually matters more than just scaling in an unlimited manner for us..” Deepti Sarma, 39:35
As there are a lot of new grocery players and offline retailers who have started an online store to deliver products, Deepti takes this positively mentioning that it helps bigger companies maintain their quality and efficiency.
“..because finally to break even and to be profitable is not something that everybody can do - unless in addition to your customer focus, you're also careful about the base you're catering to and the kind of experience that you're giving and the costs that you're incurring in this process..” Deepti Sarma, 40:25
The startup has been partnering with a lot of farmers across the country and always got fresh produce directly from the farmers- around 90 percent.
This empowers the farmers to understand the price their goods are being sold at, therefore increasing transparency and trust.
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