ZEPTO: A Billionaire Company

ZEPTO is a startup company founded by two Stanford dropout teenagers: Aadit Palicha and KaivalyaVohra that deliver groceries, fruits, dairy products, cooking essentials, etc. within 10 minutes. Yes, you heard it right, you are busy binge-watching, scrolling social media, playing video games, creating your AI avatar, and boom your order is at your doorstep.

Swiggy Instamart, Zomato, Grofers now Blinkit are already delivering groceries online, but the way ZEPTO is flourishing in this business is revolutionizing the Indian E-Market. Today in this blog we are going to look at some of the business lessons that made ZEPTO a Billionaire Company.

INTRODUCTION:

ZEPTO is an Indian startup company founded in the year 2021 by two Stanford dropout teenagers with a vision to simplify the basic needs of Indian families during the COVID-19 pandemic, and it was going to be a big thing in the Indian E-market, something that had never happened before. The company was started in Parel, Mumbai and now operates in 9 different cities: Bangalore, Kolkata, Delhi, Hyderabad, Chennai, Pune, Noida, and Gurgaon.

According to the CrunchBase website data, ZEPTO has raised $360 million under four rounds of funding and is considered one of the emerging unicorn companies. Initially, ZEPTO was known as Kirana Kart Technologies Private Limited but in January 2021 it became ZEPTO.

Basically, ZEPTO is an aggregator business that takes groceries from vendors and sells them online at a good discount.

How It Started?

This was a time when Aadit and Kaivalya dropped out of Stanford and came back to India. It was the COVID pandemic and everyone was locked inside their homes so as were these two teenagers. They find it difficult to order groceries online and if groceries are ordered their delivery time is another problem. So, they took this problem as an opportunity and decided to launch their own startup to simplify this delivery-related problem. Finally, they launch their startup and begin analyzing customer buying patterns. They note that those customers who receive their orders quickly tend to purchase groceries more frequently than those who do not.

So, their plan was to deliver groceries faster than others. They were also delivering the products in 15-20 minutes, but their average time for product delivery was around 8-9 minutes.

The core idea of ZEPTO was to deliver their groceries within 10 minutes.

Along with the delivery time, they were focusing on other factors as well:-

·      Dark Stores: To deliver groceries on time, your company must have dark stores, which means an inventory. Dark stores have all the essential items in bulk so that if any seller is having a shortage of those groceries in the market, they can deliver those groceries from their dark store to the customers timely.

These dark stores are available within every 5 km radius for better convenience and timely delivery.

·  Efficacy use of Artificial Intelligence: We are living in the age of information. It cannot be confined within boundaries and rapidly flies around the world. Artificial Intelligence uses the available information and creates various strategies and algorithms that can really accelerate your business.

Finding the best route to deliver groceries, Analyzing the demography of customers, from order received to order delivered, everything is A. I powered.

Once ZEPTO receives an order, it utilizes artificial intelligence to pinpoint the exact location of the product, and packaging is done within seconds of finding the location. Finally, the product is shipped from the store and all these processes take only 60 seconds.

·     Consumer’s Behavior Pattern: Understanding consumer behavior and building a marketing strategy accordingly is one of the key competencies of a successful startup company. ZEPTO is already aware of its competitors and is making sure to provide the best services to gain an upper edge over the competition.

There are 3 basic W’s to understand the consumer’s behavior pattern:

1.    WHAT: What do consumers really want? Generally, they want quick deliveries, discounts, and value for their money.

2.  WHAT: What consumers will pay for? This startup came into the picture when there was a COVID-19 pandemic. So, consumers will pay for the convenience they don't want to go out shopping.

3.    WHAT: What you can do to overcome your competitors? It can also be considered as what exactly is available in the market that your competitors are lacking. For ZEPTO it was delivery timing.

In addition to these factors, ZEPTO focuses on its customers' shopping patterns, how often they are buying groceries, how much they can afford to spend, and what discounts are most appropriate for any given customer.

·      Customer Acquisition: Every company wants to bind their customers to some extent, having loyal customers not only increases the sales graph but also attracts new investors. Within 11 months ZEPTO managed to acquire loyal customers with a 200% customer growth rate.     

ZEPTO noticed that for the groceries that take 45 mins to 1 hour to deliver, their returning customers rate gradually increased by 20%, and for those who are receiving orders within 20-30 mins, their returning rate is 40% to 50%.

In short, customers like discounts but if companies can manage to reduce the delivery timings, then customers don't care much about discounts.

ZEPTO competitors like Blinkit, Dunzo, Big-basket, Swiggy, Zomato, Amazon pantry, etc. are also focusing on this factor and Blinkit has also started its 10-minute delivery system. So, the competition for ZEPTO is not over yet and there are many more to come.

Conclusion 

If your product is really good and has a good PMF model, surely it will thrive in the market. It is not always necessary to launch unique products but companies can take advantage of what other companies are lacking in their products. ZEPTO did the same but it knows that still there is a competition and needs to do continuous changes to its marketing strategies to thrive more.  So, this concludes our blog on ZEPTO: A millionaire company.

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