Amazon's entry into quick commerce faces scale, recall challenges

Jefferies says Amazon's late entry, app integration strategy and limited brand recall may hinder its Q/C push in India despite competitive pricing and Prime perks

Amazon's entry into India’s rapidly expanding quick commerce (Q/C) market is still in its early stages and will require considerable effort and investment to reach competitive scale, according to a recent analysis by US-based brokerage Jefferies.

 

The e-commerce giant currently operates its quick commerce service within the main Amazon app, a strategy that contrasts with the vertical models adopted by local leaders such as Blinkit and Swiggy, which have launched dedicated platforms. This approach, analysts said, may be limiting Amazon’s ability to gain traction in a market that increasingly favours standalone quick commerce experiences.

 

“On Amazon, we think these are early days and the offering needs to have enough scale in terms of coverage to be a meaningful player in the overall Q/C market,” the Jefferies report noted. “This may require serious effort including burn given Amazon lacks brand recall for Q/C unlike incumbents.”

 

The firm highlighted, “Currently, Q/C is part of the main Amazon app, while experience suggests higher traction in case of verticals like Blinkit (Swiggy too has launched a separate app for Q/C),” analysts said.

 

Experts said that quick commerce is no longer a niche experiment, but a mainstream consumer behaviour shift in Indian metros, where customer expectations around speed and convenience are reshaping digital retail. As consumers increasingly shift discretionary spending towards faster formats, horizontal platforms like Flipkart and Amazon are being compelled to respond.

 

“Q/C has become mainstream and the entry of horizontal platforms like Flipkart and Amazon is more out of force, as users (and their share of wallet) have been rapidly moving to Q/C platforms,” the Jefferies report said.

 

The growing popularity of the sector has intensified competition. Jefferies said the market in some pockets may get cluttered, with as many as six different quick commerce platforms present in certain locations. It noted that some players are trying to woo users via aggressive discounts. 

 

Jefferies said Amazon India’s quick commerce category presence appears fairly expansive and goes well beyond grocery, although it still trails some of the incumbents. It added that product pricing is quite attractive—especially for Prime users, where discounts are even higher than quick commerce incumbents’.

 

“For our sample basket, Amazon Now offers a high level of discounts, behind only JioMart and DMart Ready, and equal to Swiggy Instamart MaxxSaver (bulk). It offers higher discounts versus Q/C incumbents (Blinkit, Zepto and Swiggy Instamart) as well as Flipkart Minutes,” said the Jefferies report. “Based on our sample basket, Amazon Now offers the highest discount in dairy, while it is in the top three in four other categories.”

 

In a bid to attract users, ‘Now’ is offering free delivery on all orders above ₹99 for Prime users and a ₹30 delivery fee for orders up to ₹99, according to the Jefferies report. The platform also does not charge additional fees such as handling, surge or late-night fees, at least for now. In addition, Amazon Now is offering cashback of ₹70 on all orders above ₹299 and ₹150 for orders above ₹649, for Prime users. Non-Prime users do not enjoy benefits such as a waiver of the ₹10 handling fee and also receive lower cashback.

 

Amazon has formally rolled out its quick commerce service, ‘Now’, in select areas of Bengaluru following a six-month pilot. The offering remains integrated within the main Amazon app, mirroring Flipkart’s approach, and does not have a standalone platform.

 

Navigation on the app suggests that Amazon Now has a fairly elaborate presence across most categories where the incumbents are also present. This is similar to the launch of Flipkart Minutes in August 2024, which also came with a complete basket from day one, riding on the advantage of being a horizontal e-commerce marketplace with existing supplier relationships.

 

“Competition remains a key monitorable for Eternal (Blinkit) and Swiggy, even while the game will not be easy for Amazon given its late entry,” said the report.

 

For Prime members, Amazon Now offers a lower threshold for free delivery (₹99 vs ₹199 for non-Prime users), does not charge a handling fee and offers higher cashback. Users can also avail an additional 5 per cent cashback with the Amazon Pay ICICI credit card, a co-branded card with ICICI Bank (3 per cent for non-Prime users).

 

Jefferies continues to monitor the competitive dynamics around key players such as Swiggy and Blinkit. Amazon’s eventual positioning will depend on how decisively it expands coverage and builds consumer mindshare in a crowded and fast-evolving space.