Hyperlocal Goes Wide

Startups take the horizontal route, delivering everything from food and groceries to medicines and stationery. After a catastrophic start, hyperlocals are back in vogue with Swiggy and Dunzo locked in a fierce battle.

- Sayan ChakraBorty

They shot to fame real quick, but their fall was even quicker. The general consensus was that homegrown on-demand hyperlocal startups were destined to go bust. Most of them eventually did. But that was some years ago. The playbook has been rewritten and the war bugle has been blown again. At stake is an opportunity to win over consumers with instant gratification. “Speed is like a drug,” says Shivakumar Ramaswami, founder of IndigoEdge, an investment bank. “If you can deliver goods real fast, customers will be loyal. That is the thesis (of hyperlocal).”

Competing fiercely for this loyalty are Swiggy, a food delivery unicorn that survived and thrived in the punishing years beginning late 2015, when calamity first struck the hyperlocal populace, and Dunzo, an upstart that seems to be at ease playing David to Swiggy’s Goliath.

The duel has brought the spotlight back on hyperlocal, which, despite the initial promise, was perceived as businesses that brought misery to stakeholders. And rightly so. Most of the early proponents of hyperlocal in India such as Grofers, PepperTap, ZopNow and TinyOwl among others were badly bruised.

Swiggy and Dunzo seem to have learnt from the mistakes of their peers. Unlike yesteryear’s vertical focused poster boys, they deliver everything from food and groceries to medicines and stationery. The idea is to increase frequency of transactions on their platforms and become ubiquitous in the long run.

Swiggy did not respond to an email from Forbes India. Dunzo Chief Executive Kabeer Biswas wrote: “We are largely keeping ‘no comments’ externally for all stories. About time to put our head down and focus.”