A decade ago, no one imagined that shopping for household groceries would be as simple as clicking a button.
However, with the rise of on-demand grocery apps, this dream has now become a reality.
For people who lead busy lives and have absolutely no time for grocery shopping, apps like Blinkit, Zepto, BigBasket, Amazon Fresh, and Dunzo are a godsend.
These quick-commerce grocery delivery apps enable customers to shop for household essentials and more from the comfort of their homes. Apps like Blinkit have mastered this model and are now able to deliver grocery items within a matter of minutes.
As of January 2022, Blinkit was valued at $1 billion, which demonstrates the validity and need for online grocery delivery businesses.
So if you too are looking to enter this rapidly growing business of online grocery delivery, then you’ve landed in the right place.
In this blog, we’ll dissect Blinkit’s business model and understand how it generates revenue. So let’s get started!
What is Blinkit?
Blinkit—formerly known as Grofers—is an Indian quick-commerce grocery delivery service app.
The foundation of the Blinkit business model was laid by Albinder Dhindsa and Saurabh Kumar in Dec 2013.
Blinkit began as a humble hyper-local grocery delivery startup. However, today, Blinkit’s services are available in over 30 cities in India including Delhi, Gurgaon, Kolkata, Lucknow, Mumbai, Bengaluru, Ahmedabad, Noida, Jaipur, Pune, Chennai, Chandigarh, Amritsar, Bhopal, Indore, Dehradun, Agra, Goa, Patiala, Haridwar, Kochi, and Jodhpur.
As Blinkit began to grow, it got a lot of attention from investors and was finally acquired by Zomato in 2022. This acquisition has proved to be beneficial for Blinkit, as it now has additional resources to scale its operations.
Blinkit is a very reliable and handy app that enables users to browse and order groceries and everyday essentials through the platform. Because it is easy and so convenient to use, Blinkit has now become a household grocery delivery brand.
As a pioneer in the online grocery delivery industry, it allows people to shop from their favorite local grocery delivery store without leaving their homes.
From fruits, vegetables, dairy, bakery products, snacks, skincare products, and even pet essentials—Blinkit promises to deliver everything one could possibly need in a 10-90 minute window.
Another exciting feature that Blinkit offers is that users can schedule deliveries for a later time or date for maximum convenience.
But there’s more to this. Keep reading to discover some of the more exciting features of the Blinkit grocery delivery app.
How does Blinkit work?
Blinkit runs by allowing customers to place an order from their website or mobile application. Customers can browse through a variety of products. Currently, Blinkit offers about 7,000 products on its platform.
Once the customers have selected what they want, they can add the items to a virtual cart and proceed to checkout. Blinkit has partnered with Paytm and MobiKwik to offer the coveted one-touch payment option.
Then, Blinkit relays the placed order to a nearby grocery store retailer who is then responsible for accepting the order request and preparing it for delivery.
Once the order is ready for dispatch, the Blinkit platform notifies a delivery agent who then makes their way to the store for pickup.
After pickup, the driver is tasked with delivering the ordered items safely to the customer’s preferred location. Once the items are delivered, customers are redirected to the feedback page where they can rate their overall experience.
Unique Features of Blinkit
As you can see, Blinkit workflows are very similar to those of other on-demand grocery delivery apps.
However, what differentiates Blinkit from its competitors is its unique app features and the promise of quick deliveries.
To get a complete list of features of a grocery delivery app, click here.
Here are some of the key features that make Blinkit stand out from the rest:
1. The bold 10-min delivery feature:
In June 2021, Blinkit declared that it had successfully redesigned its delivery operations and would now be able to deliver almost any item within 10 minutes of ordering.
Blinkit was able to fulfill this promise by shifting to an inventory-based sales model. Under this model, Blinkit acquired several warehouse spaces around major cities and started shipping products from there.
Additionally, Blinkit also has an impeccable network of partner stores in densely populated cities, which help in quicker deliveries.
2. Personalized messages:
Blinkit now allows users to write personalized messages like “Happy Birthday” or “All the best” when placing orders. This elevates the user’s shopping experience as they can now buy products from Blinkit and have them delivered to their loved ones with a personalized message.
3. Brand stores for partners:
Blinkit has decided to ride the boom in digital transactions by allowing brands to showcase their products with their own brand guidelines. This is done to make it easier for their customers to find their favorite brands. Brands partnered with Blinkit can also create custom pages and flows to highlight different products.
4. Order cancellation feature:
In the spirit of full transparency, Blinkit allows users to cancel their order with no additional charge while it’s still in the packing stage. This hassle-free cancellation can be done either through the mobile app or the website.
5. Flexible payment options:
Paying for purchases on the Blinkit app has become more convenient than ever. With a variety of payment methods to choose from, users will have no trouble paying for their orders. They can either opt for cash on delivery, credit cards, debit cards, or QR-code UPI payments.
6. Blinkit Print:
Blinkit Print is a printing service initiative that allows users to upload documents onto the app. Once uploaded, users can sit back and relax while Blinkit prints those documents and delivers them to the user’s doorstep.
Overview of Blinkit’s Business Model
The business model of Blinkit heavily depends on three major segments: local grocery vendors, app users, and delivery drivers.
We’ve broken down the role of each segment below:
Local Grocery Vendors
Blinkit collaborates with the local retail and wholesale grocery stores. This allows Blinkit to fulfill customer orders. Once partnered up, Blinkit lists the offerings of the local grocery stores on their interface.
In return, Blinkit charges a commission fee from its partners. This model works well for those vendors who want to expand their digital outreach but don’t necessarily have the budget and resources to do so.
Blinkit App Users
The concept of having groceries delivered to the doorstep couldn’t have come around faster.
As consumers lead a bustling lifestyle, avoiding shopping in person has become a favorable choice. Hence, Blinkit aims to target working professionals, senior citizens, and students who have very little time on their hands for grocery shopping.
To tend to this target segment, Blinkit offers mobile grocery delivery apps for Android and iOS. The app is easy to use and has a variety of offerings. Because of the intuitive app design, multiple offers, and 8-10 minute delivery promise, Blinkit has gained a lot of traction in the past few years.
Delivery Staff
Blinkit’s delivery agents do the last-mile delivery of grocery items. They are local drivers who are responsible for picking up the order from a grocery store or a warehouse and delivering it to the customer’s doorsteps.
What differentiates Blinkit from the other Blinkit-like grocery apps is this extensive network of delivery drivers who work hard to deliver everyday essentials to customers in a safe and timely manner.
What’s new with Blinkit’s Business Model?
Initially, Blinkit suffered huge losses and got unsatisfactory results in their endeavors.
While the business model sounded great on paper, many factors did not pan out when executed practically.
One of the main reasons for this was the unreliability of the local grocery stores. This ranged from incomplete orders, poor quality, and unavailability of the listed products.
As a result, the business model suffered and a lot of customers were dissatisfied with the business strategy of Blinkit.
To address this issue, Blinkit took extensive steps and shifted to an inventory-based business model. This shift allowed Blinkit to tend to its customers without having to heavily depend on local retailers.
This change also helped Blinkit compete with Amazon Fresh and JioMart—who at the time were constantly expanding their offerings and improving their delivery timings.
This shift in the business strategy led to consistent deliveries of high-quality products. It also gave Blinkit a leg up on its competitors. As a result of this evolved business model, today, Blinkit has become a go-to app for grocery deliveries.
Blinkit’s Revenue Model
How does Blinkit make money?
Is that what you’re thinking? If yes, you’re not alone.
A lot of on-demand grocery app businesses often wonder how Blinkit has scaled its services and has become one of the most used grocery delivery apps in India.
Through skillful and tactical use of technology, Blinkit has slowly expanded its partner network to include products like meat, baked goods, skin care products, flower delivery, and even baby products!
This extensive network has helped Blinkit generate a massive revenue stream. While platform product sales are the #1 source of Blinkit’s revenue—it isn’t the only one.
Blinkit also makes money through delivery fees, commissions, subscription fees, and advertising.
Commission-Based Fees
This is Blinkit’s primary revenue stream. Blinkit changes a commission, which is usually a portion of the sale price, on each order. Partners and wholesalers pay these commission fees for having their products and goods listed on the app. As a result, on each sale, Blinkit gets to pocket a certain amount in the form of a commission fee.
Delivery Charges
Blinkit app users are liable to pay delivery fees for every order that they place. The delivery fees are subjective and depend on where the users are located. Usually, Blinkit charges a higher delivery fee during peak hours.
Subscriptions
Blinkit offers a subscription model for its users as well. Subscribed users access a variety of benefits, including free deliveries, discounts, and early access to future releases. Blinkit’s subscription model helps it generate a steady monthly revenue. It also strengthens customer loyalty, as subscribers of Blinkit are more likely to make their purchase through Blinkit—and not any other app.
Promotion
Like most Q-commerce grocery delivery apps, Blinkit also has room for advertising and promotion on its platform. Grocery partners pay to have their advertisements displayed on the Blinkit app and website.
How is the Blinkit business model doing so well?
Blinkit primarily operates on a commission-based revenue model. This means that the success of the Blinkit platform greatly depends on the success of the partner grocery stores. Hence, Blinkit is always striving to partner with more local retailers and shop owners.
Blinkit’s revenue model works well because it makes room for high-profit margins. Usually, the partner stores are charged 8 to 15% on every order made through the Blinkit app.
Blinkit also invests in original labels of products and generates a lot of capital through these intentional investments. As a result, more and more brands are seeking to collaborate or get Blinkit to invest. As a matter of fact, Blinkit’s private brands make up 20% of their total revenue.
Blinkit’s Marketing Strategy
We’ve seen how Blinkit works, its revenue model, and why it works so well. But there’s another factor that contributes to Blinkit’s success—it’s marketing.
So, in this section, we’ll be looking at some of Blinkit’s marketing strategies and understand why they complement its business model so well:
1. Brand Repositioning
Blinkit rechristened itself from Grofers to Blinkit to further highlight its USP—ultra-fast deliveries.
“Let’s Blink It” is catchy and memorable—and has managed to stick with its target audience. As a result, Blinkit has a higher brand recall and the name perfectly aligns with their core value proposition of lightening deliveries—like in the blink of an eye!
With brand renaming, Blinkit has also elevated its brand positioning. While Grofers was primarily a grocery delivery app, Blinkit, on the other hand, is now repositioned as a growing q-commerce marketplace that sells not just groceries but so much more.
2. Data-Driven Targeting and Personalization
Blinkit relies on user data like purchase history, location, search history, and more to display and suggest products to the end-users. These data-driven dynamic recommendations nudge the users towards impulse purchases.
Blinkit also runs targeted campaigns and personalizes promotions and discounts. For instance, end-users who’ve shopped a lot of skincare items may notice discounts on new beauty product arrivals.
3. Social Media Engagement
Blinkit’s social media strategy is pretty straightforward. It creates and publishes content that is relatable, trendy, and thought-provoking. Blinkit uses memes, challenge reels, customer testimonials, and delivery agent experiences to create a sense of community.
Conclusion
The purpose of the Blinkit app is to act as a bridge between online shoppers and local merchants. By creating a dynamic interface that facilitates communication between grocery retailers, drivers, and customers—-Blinkit has truly reinvented grocery shopping.
As per a study by Grand View Research, the Indian online grocery market was valued at $2.9 billion in 2020, expected to grow at an annual rate of 37.1% in the upcoming years. As one can see, the market for e-delivery apps is ripe and businesses in this niche can scale with ease.
As e-consumerism becomes a norm, more and more entrepreneurs are gravitating to developing their very own on-demand delivery app.
It may seem like a daunting task if you’ve no coding experience or technical knowledge to build an app. This is exactly where Deonde can help you. With our SaaS-based grocery delivery store, you can create your Blinkit clone in a matter of days.
Our on-demand apps are enriched with advanced AI-driven features and can be customized to better meet your business model. So if you too are impressed by Blinkit’s business model and want to build a similar business for yourself, then get connected to Deonde today.
Let us help you create an app similar to Blinkit in the blink of an eye!
FAQs
1. What is the concept of Blinkit?
Blinkit is a quick-commerce, digital platform, focusing on delivering grocery essentials and everyday use items. The company aims to provide maximum convenience to its users by offering rapid delivery for select household items.
2. What is the main revenue stream of the Blinkit app?
A major chunk of Blinkit’s revenue comes from customer orders. In addition to product sales revenue, Blinkit also makes money through delivery fees, commission fees, and advertising fees from partner stores and brands.
3. How does the Blinkit business model work?
Blinkit operates under a hyper-local business model. It primarily partners with nearby retail stores and warehouses to fulfill orders. It also depends on delivery partners for the successful delivery of the ordered goods. Hence, Blinkit acts like a bridge, allowing customers to shop for local inventory and have it delivered to their doorstep.
4. How does Blinkit make money from customer orders?
Blinkit takes a margin on each product that gets ordered through their interface. This profit margin varies from order to order depending on the average order value. During peak hours, Blinkit also charges a surge fee in addition to the normal delivery fee. Additionally, Blinkit offers subscription-based membership programs like Blinkit Prime—where members enjoy benefits like free delivery and discounts. Hence, this is how Blinkit generates revenue from customer orders.
5. Does Blinkit charge any commissions to its partner stores?
Blinkit collaborates with local stores and grocery partners with them to list their products on the platform. In turn, it levies a commission on each order placed through the platform. It also charges partner stores for in-app advertising and promotions. As a result, Blinkit generates a steady source of revenue by partnering with grocery businesses.
