Instant commerce enters next leg of growth
Rapid delivery, or instant commerce, is entering its next inning of growth — and investors looking to keep momentum will need to evaluate new revenue opportunities.
Why it matters: The global market potential for instant commerce players is poised to reach over $350 billion by 2026, or account for about 10% of total e-commerce spending, Coresight Research projects.
What they’re saying: The rapid delivery industry has proven "challenging and unable to accommodate a large number of competitors," the report says. (See our report on the food tech shakeout from June.)
- Instant commerce players looking to win market share would do well to offer items like apparel, consumer electronics, hardware or DIY products and small household appliances, Coresight says.
- "Those that prevail will be able to acquire new consumers in markets beyond their urban core and enhance their selections by leaning into both loyal consumers’ and new consumers’ expressed interests in apparel, consumer electronics and home products,” Coresight says.
- The move allows companies to expand their market while "keeping a tight grip on the assortment needed to make their business model run efficiently,” the report says
State of play: A February survey found that 12% of US consumers use an instant commerce platform.
- Those consumers skew younger, more affluent and tend to dwell in densely populated urban areas.
- Yet about a third are pretty frequent users, turning to the platforms a few times a month, the survey found.
Yes and: Cultivating loyalty among these customers represents an opportunity for quick delivery players because of their “lifetime value,” Coresight says.
- While these customers typically use rapid commerce services to supplement their regular shopping trips, they also stand to make it a habit.
Be smart: Quick delivery players have had it tough in this market due to worsening macroeconomic conditions that have made tapping new financing harder.