December 1, 2021

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Tech Giants Capture Grocery Delivery Demand

Around the world, the ultra-fast delivery space is heating up. On Tuesday (Oct. 19), Berlin-based 10-minute grocery delivery startup Gorillas announced a nearly $1 billion Series C fundraise, which included a $235 million investment from Germany-based global delivery giant Delivery Hero. Gorillas, founded in June 2020, operates 180 warehouses in 55 cities across nine countries.

The news comes just five days after it was reported that Russian tech giant Yandex has launched its Yango Deli 15-minute grocery delivery service in London, following Yandex grocery delivery launches in Israel, in France and across Russia.

You may also like: eGrocery Businesses Expand Globally

While the on-demand grocery delivery space has remained somewhat fragmented globally, with local players rising to the fore in each country, multinational moves such as these suggest a growing interest from major players — in this case, Delivery Hero and Yandex — in shifting focus from local markets to the world as a whole.

The Context

In recent months, space has been quickly evolving all around the world. Last month, French grocery startup Cajoo, which delivers grocery orders by bicycle within 15 minutes, announced a $40 million Series A fundraise, led by top French grocery chain Carrefour. In late August, Buyk, a 15-minute grocery founded by the creators of leading Russian grocery delivery service Samokat, went live in New York. In July, Getir, a Turkish company that delivers groceries within 10 minutes by scooter valued at more than $7.5 billion, announced the acquisition of Blok, a similarly fast online grocery delivery service from Spain, with a presence in Madrid, Barcelona and Milan, among other cities.

Related news: France’s 15-Minute Grocery Delivery Startup Cajoo Raises $40M as eGrocery Space Grows

By the Numbers

Data from PYMNTS’ recent study, What Consumers Expect From Their Grocery Shopping Experiences, created in collaboration with ACI Worldwide, finds that 57% of U.S. consumers who are shopping for groceries online more often are doing so because it is faster than traditional grocery shopping, and 76% are doing so because it is easier and more convenient.

That being said, only 23% of consumers report that they are buying groceries online and having the products delivered to their houses, and only 8% of respondents designated home delivery as their most preferred grocery shopping channel.

See also: Digital Features Can Help Grocers Win Over 43% of Shoppers

What Insiders are Saying

“Consumers won’t want to relinquish the convenience and efficiency of online grocery delivery,” Ashwin Wadekar, strategy at Gorillas, told PYMNTS in an interview, “because the level of flexibility and empowerment opens a lot of doors for how they can more productively spend their time, which will lead to even more grocery-delivery demand.”

“What we’re excited about is the chance to change the concept of how people shop,” Zach Dennett, co-founder of New York 15-minute grocery delivery service Jokr, told Karen Webster. “We’re seeing customer behavior is very sticky because once [they] stop planning ahead and [they] realize that [they] can just make the grocery choices [they] want the minute [they] want them, it’s kind of hard to go back to that planning.”

Read more: Gorillas Aims To Bring eGrocery Into The Future With Lightning-Fast Delivery

No Joke: Jokr’s 15-Minute Grocery Delivery Out To Change Consumer Shopping Habits

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