Amazon enters the food delivery war
A lot of people on my LinkedIn timeline have already announced Amazon as the winner of the food delivery war in India, one week since their entry. While a few have countered saying “Huh..like their win in groceries?”
It is too early to comment on whether Amazon will do well in this market. Food delivery has always been a sector where multiple unicorn startups have bled money without dominating the market. There seems to be no loyalty with the customer ordering from whichever app is giving out discounts at the moment.
I won’t do a hot take on the unit economics of food delivery. Or if any food delivery app will ever become profitable. There are tons of posts on this topic already: Why Do Food Delivery Companies Lose Money?, The leaky bucket of Indian food delivery startups, Food Delivery Wars, Food fight.
What I will write about instead is the JTBD when it comes to food delivery and whether Amazon can fulfill these jobs. Let’s start.
Amazon is good at delivering you a specific product, with quality control, at a good price, in the shortest time. It sucks at product discovery. If you already know what you want, Amazon is the place to go. If not, then you go to a Myntra or an Urbanladder; places which have nailed product discovery.
Swiggy vs Amazon will not be just about whether Amazon can delivery food efficiently or not, and how long it takes for Amazon to get a good inventory. Those things matter. But what will matter too is the ordering behavior of Indians: Do we have a specific restaurant in mind before opening a food delivery app.
If yes, then it won’t be hard for Amazon to get the order. All they have to do is get the restaurant inventory on their app. The UI of Amazon, no matter how inferior it is, won’t be a deterrent when it comes to the job of delivering a specific item from the restaurant as long as they do they provide:
- Good price
- Fast delivery
- Customer support in case things go wrong
But if food ordering is anything like purchasing clothes, where discovery matters a lot, then Swiggy’s UX and curation of restaurants and meals will be a real differentiator. Think about the last time you went to Amazon because you were bored and felt like checking out some clothes to buy. Amazon utilitarian UI sucks at this JTBD.
Wrapping up, there are 2 jobs when it comes to ordering food:
- You have a specific dish from a specific restaurant in mind, and you just want the app to get you that
- You are hungry/bored. You want some good options
The success of Amazon (even after they get the basics right) will depend on what is the % of these two jobs. If food delivery is anything like the fashion vertical Amazon will find it hard to win the market, unless they burn millions and heavily subsidize this sector till Swiggy and Zomato die.
One thing is certain: It is a win-win for customers in the short term. Let’s see what happens in the long run.