Amazon's Quick Commerce Service Tez To Challenge Blinkit, Zepto
The move positions Amazon against established players like Blinkit, Zepto, and Swiggy Instamart in the ultra-fast delivery of groceries and daily essentials
Amazon India is set to enter the burgeoning quick commerce market with its service reportedly code-named Tez, expected to launch as early as late December 2024 or early 2025, according to a Reuters report. The move positions Amazon against established players like Blinkit, Zepto, and Swiggy Instamart in the ultra-fast delivery of groceries and daily essentials, a sector projected to grow to nearly USD 7 billion by 2024.
As per reports, initially planned for a first-quarter 2025 launch, the Tez project has been fast-tracked, with reports indicating that its rollout could be finalised during Amazon India’s December review meeting. The launch may coincide with the company's annual Smbhav event, highlighting its ambition to capture a slice of this fast-growing market.
Amazon plans to adopt a model similar to its competitors, focusing first on groceries and everyday essentials. The company is reportedly establishing dark stores, managing stock-keeping units (SKUs), and strengthening its logistics network to ensure quick deliveries. Hiring efforts for the project are already underway.
Competitive Landscape
The quick commerce market in India has seen a surge of activity, with Amazon joining an increasingly crowded space. Flipkart, its primary competitor, launched its Minutes quick commerce service earlier this year, quickly expanding to major cities. Meanwhile, Tata Group has entered the fray with Neu Flash under its Tata Neu super app, alongside BigBasket’s successful shift to quick commerce, which recorded gross sales exceeding Rs 900 crore in October.
Zepto, a rising star in the sector, recently secured USD 350 million in funding, boosting its cash reserves to over USD 1 billion. Zomato-owned Blinkit, a dominant player, has gained shareholder approval to raise USD 1 billion through qualified institutional placements (QIP).
According to a Morgan Stanley report, the quick commerce market in India could reach a valuation between USD 25 billion and USD 55 billion by 2030. This growth is expected to be driven by an increase in the number of households using ultra-fast delivery services and higher order frequencies.
The report also suggests that high-frequency users, comprising a third of current customers, will account for 75-80 per cent of the market value by 2030. Quick commerce is projected to surpass food delivery in gross order value (GOV) by 2026, solidifying its significance in the ecommerce ecosystem.
As Amazon accelerates its entry into quick commerce, it will face stiff competition from entrenched rivals. The success of Tez will depend on its ability to carve out a distinct space in a market defined by razor-thin margins, aggressive funding, and rapidly evolving consumer preferences.
