Groceries delivered at our doorstep. Haircuts in the comforts of our living room. First-class restaurant food with just a click on a smartphone. How are all these similar to one another? one word, hyperlocal!
Hyperlocal space startups are platforms that enable services that generally require physicality or mobility to be available offline from any place and at anytime. Hyperlocal Startups compile a database of all the necessary information and data, and according to user choices or decisions, display a few options that the user can choose from, and deliver the product, or service in minimal time. Hyperlocal platforms solve the problem of matching immediate demand with the nearest available supply in the most optimized, and swift manner. Within minutes, solutions are offered in a gigantic display of an ecosystem.
The hype about hyperlocal space isn’t old, and it isn’t diminishing anytime soon. And e-commerce Gods like Flipkart, Snapdeal, and Paytm are not oblivious to the value hyperlocal businesses bring to the table, so they are investing fortunes to accelerate their scale.
But why? What exactly is making e-commerce giants attracted towards hyperlocal space? This year, hyperlocal startups have outnumbered all other sectors in terms of raising venture capitalist money. Almost 170 million US Dollars have been invested in these hyperlocal startups compared to the 30 million invested in e-commerce giants. This large gap may force e-commerce majors to either invest in growth-stage hyperlocal startups or acquire them to make their business attractive for more VC capital. E-commerce majors have realized the potential of hyperlocal and are now ramping up their stakes via investment and acquisition to strike while the iron is hot. Additionally, e-commerce has realized that utilizing hyperlocal services can actually nurture their own growth. The hyperlocal model is a cost effective way, compared to regular e-commerce, of solving the problem of getting consumers what they need. The company helps consumers discover products and offers from merchants in their neighborhood through its mobile platform and even make the final purchase without going to the store. While e-commerce sites like Snapdeal and Paytm still have to find strong inroads in smaller cities, its growth in metros and Tier I cities is ushering in stagnation. This seems to be one of the biggest drivers for e-commerce companies to go for the hyperlocal segment. Hyperlocal startups are scaling up quickly and could be the next sector to bring massive scale to e-commerce majors.
It is safe to assume that as on-demand, hyper-local players scale up, promising speed and convenience to consumers, online commerce, beginning to feel the early signs of interference will co-opt neighborhood retailers to help make express deliveries and become the next generation of e-commerce.
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