Amazon grocery reaps big returns with 150% growth

To bolster its grocery segment, Amazon has started selling it in four formats

Online marketplace major Amazon India has seen a 150 per cent growth in the last one year in its grocery segment, on the back of repeat customers and Prime membership. Groceries and entertainment are the two key segments for Amazon, which it believes are helping it to make e-commerce a habit among its customers in India and score over Flipkart.

The company believes in making e-commerce a habit and not just a place to look for cheap deals. It has been working hard on making its FMCG and groceries category strong in the last one year. "We have added 19 lakh products into the category and have the largest selection in India," said Saurabh Srivastava, director, category management, Amazon India said.

Last year Amit Agarwal, senior vice-president and country head for Amazon India had said people are buying everything from appliances to even daily household items on their portal, indicating that this has helped in increasing the number of repeat customers.

While Srivastava did not elaborate much, he said in the last one year groceries has grown 2.5X or 150 per cent on the back of repeat customers as well as Prime subscribers.

"Appliances are bought once in a couple of years, mobile phones maybe once a year, however groceries and daily need items are things that bring repeat customers. Also, it has an incremental effect as customers end up spending on other items as well," he added.

To bolster its grocery segment the company has already started selling it in four different formats, including Amazon Pantry which is their grocery vertical, Amazon Now the company's two-hour delivery service, Subscribe and Save where customers can get items delivered periodically and Super Value Day.

Flipkart which earlier tried to sell groceries but failed to make much headway is again refocusing on the segment after its last funding round. Sources said renewed push is being made at the behest of investors who have seen Amazon make major headway in the category in the last 12 months.

Expanding its Prime benefits further to customers, Amazon on Friday announced the launch of two of its global programs --Amazon Family and Baby Wish List in India. In the baby care category, Amazon has over 1.6 lakh products and has been growing by 100 per cent year on year.

With the Amazon Family program, Prime members will be able to save more on baby products.

The Baby Wish List program, which is open to all Amazon customers, helps expecting and new parents create a list of items they will need for their baby as the baby grows.

"With Amazon Family benefits, Prime members can save even more on their monthly spends and get the convenience of free fast delivery at their doorstep, leaving them free to enjoy their time with their new baby," Akshay Sahi, Director, and Head of Amazon Prime India said.