Alf: Ultra-fast delivery apps like Getir, Gorillas and Dija aim to deliver your groceries in under 10 mins, and they're coming to a doorstep near you. They operate via a network of “dark stores” dotted around major European cities such as London and deliver groceries using electric scooters. And they are fast. Like, mind boggling, warp speed fast.
Conrad tried Gorillas a little while ago and ordered this:
It was so quick his ice cubes were still dry when they arrived.
Getir buys directly from wholesalers, charges a £1.99 delivery fee to customers and claims that its products are only 5 per cent to 10 per cent more expensive than those of a large supermarket. The company’s founder, Nazim Salur, told The Times that the service was most popular with middle-class shoppers, with super-affluent households already paying their own staff to collect groceries. “We are your butler,” he says.
Which got us thinking, what would an ultra fast delivery app for luxury goods look like? What would it offer and how?
At its most compelling an app would be like a magic lamp (again!) where you rub it and have anything that your heart desires within 10 minutes or less, as long as you can afford it. I personally think a lot of the ceremony and gubbins around a luxury in-store purchase is overrated. Net-a-porter has already proved people are willing to drop serious money over the internet. The stress of waiting for your Gucci loafers to arrive is real - once you’ve handed your £500, it almost never arrives quickly enough. At present the best Net can do is same day delivery if you order before 10am. Selfridges can deliver between 6pm and 10pm if you order before noon. The fastest luxury delivery service in London, which isn’t really luxury in the purest sense, is a pair of £300 headphones delivered via Amazon Prime Now within two hours.
|Delivery app||Funding raised as of June 2021|
|Flink Food||$304.2 million|
Funding data from Crunchbase
Companies like Getir, Gorillas, Weezy and Dija think that they can take on Ocado, supermarkets and corner shops to create their own market. They say the size of the total addressable market for fast grocery delivery in Germany alone is €300 billion. However, success will require huge venture capital subsidies. Conrad got £55 worth of groceries (and whisky) for just £25 using a Gorilla discount code. It’s a winner takes all, last company standing competition for total dominance of a potentially huge monopoly, similar to where the market for ride-sharing apps was a few years ago. Hello new millennial lifestyle subsidies!
The market for ultra fast luxury goods is in many ways just as juicy. The kind of algorithm-powered supply chains and dark warehouse infrastructure could easily be applied to Gucci loafers and Chanel handbags. What’s more, very rich people tend to be clustered in a few nice districts in any city, which could make delivery much easier. And finally, while the markup on a pint of milk is minimal, on luxury goods it can run into 100%+.
People are lusting after luxury goods and can now buy them directly from ads on Instagram - the only friction is the delivery and payment mechanism. The marketing and creation of desire is now continuous, seamless and instantaneous. But if I see a pair of Amina Muaddi shoes that I think my girlfriend will like on instagram, I still have to go through the laborious process of a standard e-commerce transaction on the designer’s website, as opposed to an instantaneous one-tap purchase linked to my paypal account. And of course I have to wait for delivery.
There are obvious and huge logistical barriers to ultra-fast luxury. Getting a £5,000 watch from a local warehouse on an electric bike poses a huge logistical and security problem. Then there is the size and delicacy of some goods. For now, a Picasso delivered direct to your door within 10 minutes of ordering online remains a pipe dream. The scarcity of some products means that getting supply right will remain a challenge for some time.
And yet, the opportunity for certain classes of “essential” or “basic” luxury goods such as a Loro Piana cashmere jumper in the winter, or linen shirts from Drakes in the summer, would represent a juicy market for the company that can get it right.
How? White label
The future of luxury can’t be predicted, instead it’s up to you to try to make it happen. A forward-thinking multi-channel luxury e-comm retailer should be taking meetings with the directors of some of the more slickly branded companies like Gorilla, to create a white labelled service. I would look at test-driving a “pop-up” at key moments of the year in locations where lots of fabulously wealthy people congregate: Art Basel in London, Hong Kong and Switzerland, Cannes Film Festival, Mykonos or the Italian Riviera to offer targeted products. Forgot your bow tie for tonight’s Cannes red carpet event? Don’t worry, we can have one from Turnbull and Asser delivered to your hotel in 10 minutes. It doesn’t matter that white labelled service won’t make any money - most of these companies won’t for years to come either! But what you learn from the experiment could change the face of luxury e-comm forever, earning your company a significant first mover advantage.
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Here’s how Gorillas and other rapid delivery apps work
Conrad: On Sunday morning, I set out to find one of the distribution hubs for the rapid delivery apps. As it turns out, Gorillas has one on Stoke Newington high street only a few minutes walk from my house, which explains the four minute delivery time. There's some branding on the front with a QR code sandwiched between the fish shop and Halfords, but the real action is in the back.
Gorillas deliveries are coordinated from the back door of a building which would normally be where groceries arrive in a traditional shop. It’s a hot day, so the door’s open and inside there are riders and managers milling about, and half a dozen bikes and helmets ready to go. A very small sticker on the door frame and the logos on the bikes are the only sign that this is not a normal grocery shop.
If you squint, you can get a glimpse of some refrigerated containers, and just around the corner are rows of shelves with sundries. As I took pictures, a delivery rider cycled away, and another rider arrived back at the depot after a break.
Here’s what the site looked like on Google Street View before the troop moved in.
More importantly, Gorilla’s paid social strategy is underpinned by high production values based around location and convenience. If you live in any of the target areas, you’ll probably see some of their high quality videos featuring real imagery and riders modelling the bikes. When this popped up on my feed it “hit different” than the usual targeted stock photography dross. It’s also probably much cheaper to advertise to everyone in a specific area rather than try to compete with a more specific, targeted group. They also use Facebook's dynamic ad generator which automatically runs AB Tests on different versions of creative to see what works best for different audiences.
Compare this with the different approach of the two other fast delivery apps in London: Getir and Zapp.
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