India’s already heated up food delivery space could soon see a new, cash-rich entrant. According to a report from Reuters, Amazon is planning to launch an online food delivery service in India by September this year, citing sources familiar with the matter. After shutting down its food delivery service Amazon Restaurants in June in the US, Amazon is now focusing on the Indian food delivery market to attract more customers.
For the e-commerce to cloud computing conglomerate, this wouldn’t be a new territory. Amazon has ventured into the food delivery market since the launch of Amazon Fresh, a grocery delivery service which was introduced a decade ago. Since then, it has also introduced a workplace lunch delivery service – Daily Dish in the US; which too was shut down in June. The rise of several food delivery services was the primary cause of the decline of Amazon’s business in this sector.
Now, along with the Indian investment firm Catamaran, the company is working on introducing this service in India and has already begun hiring staff for the operations, unnamed sources told Reuters. Catamaran was founded by Narayan Murthy (Co-founder of Infosys) and investor Arjun Narayan. The investment firm has backed startups like Acko, Paper Boat, Anviti, Healthsrping and Achira among others.
India’s food delivery market is dominated by Swiggy, Zomato along with smaller players Uber Eats, Foodpanda etc. Apart from these, many local startups have also dived in this market. The competition in the Indian food delivery market is extremely fierce and unless Amazon introduces something new to this sector, it is bound to be affected by its rivals.
Zomato, which is backed by Alibaba’s payment affiliate Ant Financial, has reported 80 million active monthly users and provides premium services (including faster deliveries) through Zomato Gold membership. While the five-year-old service Swiggy has recently introduced Swiggy Daily which provides homestyle lunches and dinners at cheaper rates. Uber entered into the food delivery market by launching Uber Eats in 2017. One of its rivals Ola acquired FoodPanda in the same year.
With such tough rivals, Amazon will require to be more creative and introduce unique offers for its customers. It is possible that Amazon will include the service in its Amazon Prime subscriptions just like it did in the US. Amazon Prime includes ad-free music streaming, movie streaming, and faster deliveries. Uber is also testing such an all-in-one subscription plan which would include Uber Eats along with ride-sharing services.
Sources familiar with the subject told Reuters that Amazon’s move into delivery from restaurants and takeaway food outlets will help Amazon to attract customers for its other services.