How personalization for hyperlocal delivery is unique

Image credit: Moyan Brenn

As the usage of smartphones increases, entrepreneurs are eyeing this as an opportunity to dive into targeting consumers on a microscopic basis, something we call going hyperlocal.

Since the start of the year, investors have pumped US$150 million into 20 food-ordering, and food-delivery, start-ups. This is proof that hyperlocal is the new wave, and is here to stay.

How hyperlocal is sculpting the landscape

Online stores go brick-&-mortar

Like how ecommerce entrants had once threatened local retailers, hyperlocal businesses (mostly mcommerce) are beginning to threaten ecommerce, now, their slower ancestors. To counteract this, many ecommerce players like Amazon, Flipkart, Paytm, and SnapDeal have launched their offline stores not only as a convenience pick-up store, but also as supermarkets for items with low shelf-life like groceries in the form of Amazon Kirana, Flipkart Nearby, Snapdeal Instant.

Simultaneously, hyperlocal mcommerce players, like Grofers and Peppertap, are opening up their offline stores.

Stores going online

Hyperlocal brings a breeze of relief for local retailers too. With ecommerce players tying up with local stores for time and cost-effective product procurement, there are also platforms like Zopper, who are bringing in trusted local retailers online for efficient post-sales service too. Neeraj Jain, the co-founder and CEO of Zopper, says that, “Zopper is an app that allows a customer to choose the retailer with the best price for a product, from over 500,000 online and offline retailers, thus creating a unique shopping experience. It caters to the urban mobile-savvy consumer, who wishes to find the best local deals through pricing and product comparison.”

The flaw with hyperlocal

From the above discussion, two kinds of hyperlocal players emerge out of the scene: one who sources from local stores, and the other who creates their own inventories and deliver them.

Now, the flaw with hyperlocal in the first case is that you are the one doing all the running with wafer-thin margins, and if you are the second one, then you are limited by the number of offline stores you’ve opened or tied up with, and again single-digit margins, due to hefty online discounts.

Even though funding is not an issue, expecting customer loyalty in a picture flooding with hyperlocal players is like asking for the moon.

Holding your throne in this landscape

We fathom that making your ecommerce store go hyperlocal as per the trend cannot be pulled off overnight, but personalization of those local orders is something you can do. This means that you try to take the Alibaba’s Taobao way – tie up with local retailers and local feet-on-the-street services, like Flipkart did in Mumbai with local stores and dabbawalas community.

Keeping in perspective the exponential growth of hyperlocal services in 2015, it wouldn’t be wrong to say that hyperlocal is about more than just the place. It is about the time and the person. This brings us to personalization.

Realize that most of the upcoming businesses are built around habit formation, consumer convenience and delight. So delighting your customers is the only way you can retain them and keep them loyal to you.

Parting thoughts