Tata will use "Neu Flash" to Access the Rapidly Expanding Quick Commerce Market

Nitin Konde, Varun Bhardwaj

Oct 28, 2024 — 3 min read

Tata Enters Quick Commerce Market with Neu Flash

As consumer demand in the metro areas continues to grow, Tata is the most recent e-commerce giant to jump on the ultra-fast delivery bandwagon, following Flipkart and Reliance Industries (RIL). According to recent reports, the Tata group's e-commerce business Neu is about to launch 'Neu Flash', a rapid commerce platform, to a limited number of users to offer groceries, electronics, and clothing. In the upcoming weeks, Neu Flash will progressively reach more users.

BigBasket, which is transitioning to a fully-quick commerce model, will power Neu Flash for groceries, while Croma will offer phones and gadgets and Tata Cliq will handle fashion and lifestyle items, beginning with specific stock keeping units (SKUs).

The Mumbai-based steel-to-salt conglomerate has just placed its latest bet to attract internet buyers. Blinkit, which is owned by Zomato, Swiggy, Instamart, and Zepto are the top three companies with more than 85% of the market share. Flipkart has a service called Minutes, and Reliance JioMart is testing the service once more after deciding to discontinue its JioMart Express 90-minute delivery service.

Recent Growth of Quick Commerce Sector in India

E-commerce and other retail formats are being disrupted by quick commerce, which, according to a new Bernstein research report (an international research firm), is expanding more quickly than contemporary retail chains like Reliance Retail, Dmart, and Spencer Retail. This is one of the reasons why consumer platforms are responding to the shift by preparing to deliver a variety of goods outside of groceries in 10-15 minutes.

It is anticipated that Cliq will be implemented on both Neu Flash and BigBasket. Additionally, strategic brand alliances are being established. Tata Neu has been urged to exercise caution when spending large sums of money on consumer incentives, so it will be fascinating to see how it handles the fast commerce sector. The market leaders are also well-funded and making every effort to gain market share. After acquiring $1 billion in just two months, Zepto is now soliciting up to $150 million from local investors, posing a threat to market leader Blinkit, which has a 40% market share, according to multiple brokerages.

Neu Flash has not yet fully launched Tata-owned epharmacy 1mg, which delivers medicines within a few hours in certain areas, including Delhi NCR. Nonetheless, the platform also offers 10-minute delivery for several common headache medications and goods like protein whey. According to reports, Tata may also use the network of retail locations already in place for Croma to facilitate some of these deliveries. The outlets are already used for same-day and next-day delivery.

How Players are Planning for their Current and Future Business Operations?

BB Now is operated by BigBasket, which charges a tier-based delivery fee for different order sizes. Blinkit is providing free delivery at INR 199, while Swiggy has lowered it to INR 99 due to increased cash inflow into the industry. These price adjustments are a response to Zomato's intention to seek $1 billion in new funding to intensify the competition for quick commerce during the ongoing festival season, when customers are expected to spend more than they would on a typical workday.