Zepto has become the first quick-commerce company to introduce a platform fee of Rs 2 per order which applies to a select set of users. So far, platform fees have been more common in categories like e-commerce and food delivery.
For instance, Zomato-owned Blinkit and Swiggy Instamart, which directly compete with Zepto, don’t levy such a fee currently on grocery orders. The two companies, however, levy a platform fee from customers who place food delivery orders.
A platform fee isn’t the only additional charge Zepto is levying on customers. It is also collecting late night handling fee of Rs 15 on orders that are placed after 11 pm in certain cases. The company has also done away with free deliveries for select users.
“We don’t believe in being over dependent on delivery fees to be profitable. We believe in core operating efficiency and cost reduction to be profitable. We are on track to achieve the Ebitda positive milestone even with much lower delivery fees – Zepto Pass is the quintessential example of this,” a company spokesperson said.
“Blinkit and Instamart can likely fall back on food delivery customer base and cross-sell quick-commerce…While Blinkit has the largest market share currently, our checks indicate that Zepto is getting aggressive to gain share. Also Zepto has the lowest delivery rates in most places,” analysts at BofA said in a recent report.
Zepto is the third-largest quick commerce player with a market share of about 20%, behind Zomato’s Blinkit (40%) and Swiggy Instamart (37-39%), analysts at Bernstein said in a report published in January.
The additional costs come weeks after the company launched Zepto Pass – its loyalty programme – through which it promises free deliveries and better discounts. The company claims subscribers have increased their monthly spend on the app by more than 30% during Zepto Pass pilot phase.