Amazon is speeding up the launch of its quick commerce service, Tez, in India. Initially set for a 2025 launch, the e-commerce giant has moved forward with plans to roll out the service by December 2023 or early 2024. This strategic shift aims to tap into the rapidly growing $5.5-6 billion quick commerce sector, dominated by players like Blinkit, Zepto, and Swiggy Instamart. Tez will be Amazon's first foray into this competitive space and is expected to significantly impact the fast-growing quick commerce market.
The quick commerce market, driven by high-speed delivery of groceries and daily essentials, is projected to outpace the food delivery sector by 2026 in terms of gross order value (GOV). Industry projections suggest that by 2030, the quick commerce market could reach between $25 billion and $55 billion. In 2023, the sector grossed nearly $7 billion, showing remarkable growth and increasing demand for ultra-fast services. This trend, marked by high-frequency and high-value users, is set to continue its rapid expansion, making it a crucial space for Amazon to enter.
Amazon’s Tez project is focused on providing grocery and daily essentials with ultra-fast delivery, using dark stores and robust logistics infrastructure to streamline the process. These dark stores, which are localized warehouses for inventory, are critical to Amazon’s quick commerce model. The company is currently finalizing stock-keeping units (SKUs) and building the necessary infrastructure to support ultra-fast deliveries across the country.
The exact launch date of Tez is still pending but is expected to be confirmed during a December review meeting, aligning with Amazon’s annual Smbhav event on December 9-10. This accelerated timeline indicates Amazon’s commitment to entering the competitive quick commerce market in India as quickly as possible.
In line with the importance of Tez, Amazon is recruiting talent specifically for the project. Job postings highlight the strategic nature of this initiative, calling it a "ground-up initiative for an emerging e-commerce space." This signals that Amazon views Tez as a high-priority project, with significant resources and expertise being allocated to ensure its success.
Amazon’s quick commerce ambitions come as the market faces fierce competition. Flipkart has already launched its Minutes service, BigBasket has seen impressive growth with quick commerce, and Tata Digital debuted its Neu Flash service in October 2023. These players are vying for a larger share of the quick commerce market, making it crucial for Amazon to execute its strategy effectively.
Reports indicate that quick commerce's gross order value could surpass food delivery services by 2026. The expected surge in demand will likely be driven by consumers who favor high-frequency, high-value transactions, making the sector highly attractive for Amazon and other e-commerce giants.
As Amazon races to launch Tez, its ability to compete with established players will depend on how effectively it leverages its existing delivery network and partnerships with logistics providers. India’s quick commerce users demand speed and reliability, two areas where Amazon must excel to gain a foothold. Whether Amazon can capture significant market share will depend on how well it executes Tez’s rollout and meets the expectations of Indian consumers in this fast-paced market.