How BigBasket Is Trying To Retain Dominance Over DMart Ready, JioMart
BigBasket has narrowed prices with its peers on key products from butter and pulses to shampoos.
Tata Group-backed BigBasket has reduced the pricing gap with products offered by competitors like JioMart and DMart Ready as online grocers wrestle for a bigger share of inflation-wary consumers' weekly shopping.
BigBasket has narrowed prices with its peers on key products from butter and pulses to shampoos. Being the largest online retailer with three times the size of nearest competitor, that will significantly improve its consumer value proposition, increasing competition, Prabhudas Lilladher said in a June 8 note.
BigBasket's move underscores the competition in the tough grocery sector that accounts for two-thirds of India’s $836 billion retail market, led by the unorganised trade. While e-grocery is still a tiny accounting for 1%, Statista said urban Indians are addicted to online shopping, thanks to a year of intense marketing, big sales from e-tailers and the Covid-19 pandemic-induced lockdowns.
Consumers, however, are price conscious as well. More so as they cut down spending to counter inflation.
Prices were rising till February, when input began easing in key segments. Since then, BigBasket has raised prices of 24% of 125 products across categories like loose grocery items, dairy, packaged food, personal care, beverages and home care, according to an analysis by Prabhudas Lilladher. By comparison, JioMart raised prices of 32% and DMart of 30% of their products.
Online grocers increased prices on select products in May, but several products also became cheaper as raw material costs softened.
DMart Ready increased prices of 45% of the items in the loose grocery category over February, while JioMart hiked MRP on 45% such items, according to Prabhudas Liladher.
Bigbasket, however, cut prices on half of the loose grocery items, significantly reducing gap with peers. For example:
A 5-litre Saffola gold oil, for example, was priced at Rs 888 on BigBasket compared to Rs 890 on DMart Ready and Rs 959 on Jiomart.
A 10kg Aashirvaad atta pack was priced at Rs 467 on Bigbasket, cheaper than Rs 479 on DMart Ready and Rs 468 on JioMart.
Similarly, BigBasket effected lower price hikes and higher price cuts on dairy, compared to DMart Ready. Most of these products were not available for Jiomart.
The story remains the same in other categories.
Selective brands in premium biscuits, salted snacks, ketchup and Maggi turned cheaper as companies passed on benefits via offers. There was hardly any change in beverages but BigBasket reduced price gap with DMart Ready in health food drinks segment.
In personal care and hygiene, DMart Ready and BigBasket increased prices of fewer products than JioMart, which raised prices of 50% of the 35 products that were compared. BigBasket narrowed the gap on most items.
Competition is also rising among online grocers as:
BigBasket offers free delivery for higher cart value.
JioMart and DMart are making an aggressive push to market their offers and new offerings via various social media including WhatsApp.
Gowing salience of instant delivery platforms like Blinkit, Zepto, BB Now, JioMart, Dunzo and Swiggy Instamart with young consumers.
