With quality not improving and discounts going away, only 7% of Indian households surveyed now buying fruits/vegetables online
- ● Key consumer concerns include low quality of produce, high prices and cumbersome return process
- ● 73% consumers surveyed find fresh produce ordered online to be of “low quality” while 56% of respondents complained of “high prices”
- ● 51% experienced “difficult returns/grievance redressal process” with fresh produce while 37% of them had issues with “inconsistent stocking/availability”
November 24, 2023, New Delhi: The online grocery market has become crowded since the arrival of quick commerce platforms in 2022. In most metros, a consumer now has 6-8 apps that can deliver fresh groceries i.e. fruits and vegetables to their doorstep, a trend that took off during the COVID lockdowns in 2020. However, despite many platforms delivering fresh produce at doorstep, consumers are fast moving away from buying fruits and vegetables online, largely due to reduced discounts and value and the quality of produce staying average at best.
In most metros, consumers have established platforms like Big Basket, Amazon Fresh, Jio Mart along with subscription platforms like Big Basket Daily, Big Basket Now, Milk Basket and quick delivery platforms like Swiggy Instamart, Blinkit, Zepto and Big Basket Now servicing them along with a handful of local platforms. Despite consumers having so many choices of platforms to order fruits and vegetables and taking delivery at doorstep, many consumers have switched back to buying groceries from local stores and local markets in the last 10 months and many more are likely to do so in the coming months. This feedback was received by LocalCircles through over one thousand posts, comments and grievances in the last 10 months. To understand what people’s experience has been with regards to ordering fresh produce via online grocery or ecommerce apps, LocalCircles conducted a national survey which received over 24,000 responses from household consumers located in 297 districts of India. 61% respondents were men while 39% respondents were women. 44% respondents were from tier 1, 35% from tier 2 and 21% respondents were from tier 3 districts.
66% of Indian households surveyed confirmed that they buy their fresh grocery (fruits and vegetables) from the local or weekly market near their homes
From mandi or wholesale market to local markets, people have a wide choice for shopping fresh vegetables and fruits. The survey asked consumers “How are you buying majority of the fruits and vegetable for your household?” Out of 12,207 respondents to this query only 7% indicated that they buy fresh fruits and vegetables “from online/ecommerce/ grocery apps”. As for the rest, 45% of respondents indicated “from the local market”; 21% from the “weekly market near me”; 3% from the “wholesale market”; 19% from the “vendors that come in my area”; and 5% from “organized retail stores”. In effect, 66% of Indian households surveyed confirmed that they buy their fresh grocery (fruits and vegetables) from the local or weekly market near their homes while 19% buy from the vendors coming to their neighbourhood.
Biggest issue of buying fresh fruits and vegetables online according to 73% of consumers is the “low quality of produce”
Despite the convenience of online platforms and apps delivering fresh fruits and vegetables at home, many consumers have been raising issues and complaints related to quality and returns. The next survey question reached out to consumers who buy fruits and vegetables online and asked them, “What are some of the issues you have had with buying fruits and vegetables online via ecommerce/ grocery/quick delivery apps?” Some among the 11,964 who responded to this query chose more than one option. The biggest issue of buying fresh fruits and vegetables online according to 73% of consumers is the “low quality of produce”; 56% of respondents complained of “high prices”; 51% indicated problem of “difficult returns/grievance redressal process”; 37% had issues with “inconsistent stocking/ availability” of produce they would like to buy; 7% have issues with “long delivery time taken”. However, 12% of respondents indicated that “it works well by and large and I don’t have issues”.
“Quality of fruits and vegetables delivered via online platforms was always average and the return/refund process mostly painful, according to consumers”, said Sachin Taparia, Founder of LocalCircles. “However, due to competitive prices and good discounts, most tended to ignore these shortcomings. With discounts reducing and risk of COVID minimal, many consumers are now buying majority of their fresh supplies from the local market, buying only incidentals or topping up via online grocery apps”, continued Taparia. “Returns and Refund of fresh produce is another major issue where some of the apps expect a consumer to spend 5-15 minutes to request refund of small quantities of fresh produce, which is just impractical”, said Taparia
To understand the experience of consumers with various online platforms delivering fruits and vegetables, LocalCircles did a ratings exercise where consumers were invited to rate the various platforms on parameters like delivery times, selection, quality, value/price and service ratings (in terms of customer service, returns, refunds and grievance redressal). The ratings exercise was conducted in the city of Noida between between July 1, 2023 and November 20, 2023. The experience in other cities may be different but these ratings provide an indicative view on where each one of the platforms stands from a consumer perspective. Key highlights of the exercise are as under:
Average time taken to deliver: Zepto and Blinkit come on the top as fastest platforms taking between 10-30 minutes to deliver fruits and vegetables
Selection/Variety Rating: Bigbasket and Milkbasket scored 4/5 while Jiomart scored 3.5/5
Quality Rating: Bigbasket, Milkbasket, Country Delight, Bigbasket Now, and Zepto all scored 3.5/5 in this category.
Value/Price Rating: Amazon Fresh and Jio Mart score the highest 3.5/5 in the category while Bigbasket, Milkbasket and Bigbasket Now score 3/5 and the remaining online platforms surveyed score 2.5/5.
Service Rating: In this category Amazon Fresh and Milkbasket scored 3.5/5 with the best return/refund/grievance redressal processes
Overall Consumer Rating: Out of a total of 20, Milkbasket scored the highest at 14 followed by Bigbasket which scored 13.5; Amazon Fresh scored 13; Bigbasket Now scored 12.5; JioMart scored 12 while the remaining platforms surveyed scored 11.5.
In summary, the survey finds that at this time only 7% household consumers are currently relying on online /ecommerce/ grocery apps as their primary channel to buy fresh vegetables and fruits. Issues of quality, high prices, difficult returns/grievance redressal, limited selection are impacting growth of this sector per the survey. While some consumers are using these apps to get fast deliveries of a handful of fruits and veggies, most are now buying them from their local market/stores. The value pricing and discounts that were made available by these platforms early on have reduced or gone away thereby leading to prices that are 1.5-2X of the local markets. Recently a digital media platform had written about how the price of bananas was 1.5-3X of the local market on most of the online grocery platforms. If these platforms do want a sizable share of the fresh produce spend of the households, they will have to find ways in lowering supply chain costs and delivering either average quality produce at better than market prices or high-quality produce at market prices, something that none of them is doing at present.
Survey and Ratings Demographics
The survey received over 24,000 responses from household consumers located in 297 districts of India. 61% respondents were men while 39% respondents were women. 44% respondents were from tier 1, 35% from tier 2 and 21% respondents were from tier 3, 4 and rural districts. The survey was conducted via LocalCircles platform and all participants were validated citizens who had to be registered with LocalCircles to participate in this survey. The survey was conducted between Sep 1, 2023 and Nov 20, 2023.
The ratings exercise was conducted among over 2750 users of one or more of the online grocery platforms and residing in Noida between Jul 1, 2023 and Nov 20, 2023 with 300 or more ratings received for each platform.