In the last few years, grocery ecommerce has grown exponentially. However, some consumers are still more comfortable purchasing groceries from nearby stores.
This is because these brick-and-mortar retailers have already gained their trust. This customer preference has led to a new model: hyperlocal grocery delivery.
Hyperlocal grocery delivery is a trend that is completely changing the landscape of online grocery. Read on to learn how it can benefit your grocery ecommerce store.
What is Hyperlocal Delivery?
Hyperlocal delivery is a business approach that focuses on localizing operations. In this model, an online platform connects customers with nearby offline shops to meet their on-demand needs.
This model ensures that customer demands, such as groceries, medicine, and laundry services, are fulfilled quickly and efficiently, often instantly.
Hyperlocal delivery: The new trend in online groceries
The new buzzword for online grocery stores is “hyperlocal.” It’s quite an apt description of this delivery model.
Hyperlocal grocery delivery targets customers only within a defined geographical area, usually confined to a single neighborhood, ZIP code, or county.
This localized delivery model is perfect for goods and services tied to one location. Many businesses are embracing hyperlocal delivery, contributing to the market's growth.
In 2021, the global online hyperlocal services market was valued at $1.5 trillion. Hyperlocal grocery delivery accounts for a fair share of that figure.
The market value of hyperlocal grocery delivery services was $38.5 billion in 2022.
What sets hyperlocal delivery apart?
Hyperlocal delivery is developing into a distinct ecommerce business model with its own identity. Two things set hyperlocal delivery services apart: delivery timelines and niche specialization.
In traditional ecommerce, shipping can take three to five business days. Even with express options, most companies can only compress timelines to 24 hours.
With hyperlocal delivery, things are very different. Because orders are fulfilled very close to the customer’s address, timelines are much shorter.
In fact, hyperlocal deliveries can be completed even within one hour! This model is perfect for businesses selling fresh goods with short shelf life.
This brings us to the second distinction between hyperlocal delivery and general ecommerce: niche specialization.
The hyperlocal delivery model works best for businesses that sell certain kinds of products and for stores that want to capture a local market.
These traits make hyperlocal grocery delivery a valuable approach for grocery store owners.
Understanding hyperlocal grocery delivery and logistics
Hyperlocal delivery relies on technology and processes similar to those of traditional e-commerce.
The question is: how does the model achieve such different outcomes in terms of shipping timelines?
Hyperlocal businesses leverage existing infrastructure and delivery partners to create an efficient, localized supply chain. For example, consider a food delivery platform like Uber Eats.
Its customers use the platform to order from a local restaurant (i.e., the offering partner). Once the order is ready, a delivery partner will transport it to the customer’s doorstep. From ordering to delivery, the process lasts less than an hour.
If you have an online grocery store, you can implement one of these delivery models:
1. Inventory model
Here, the hyperlocal grocery service maintains its own inventory. This is done by sourcing groceries directly from suppliers and local retailers.
This model has the fewest links between the customer and the hyperlocal grocery store. It also requires efficient inventory management practices.
2. Aggregator model
This is also called the no-inventory model, where stores hold no items of their own.
Instead, they source products from local retailers and deliver the goods under their label. The Uber Eats example above is a typical representation of this model.
3. Marketplace model
This is similar to the aggregator model because the store doesn’t stock its own inventory. In a marketplace model, the offering partners fulfill the customers’ orders.
The store is a platform for customers to browse and place those orders.
4. Hybrid model
Some stores incorporate elements of different models to create a unique approach to grocery delivery. These hybrid models can easily be tailored to suit different business needs.
4 compelling reasons to implement hyperlocal delivery for grocery stores
Online grocery customers will be delighted to shop with hyperlocal stores. They will undoubtedly meet their need for quick and convenient deliveries.
However, it’s not just the customers that benefit. Hyperlocal grocery delivery can have a positive effect on your business as well. Here are four good reasons to offer hyperlocal delivery options in your online grocery store:
1. It’s more sustainable
Hyperlocal grocery delivery is very environmentally friendly. There are no long transportation times or shipping routes, reducing the carbon footprint of every delivery.
2. It boosts the local economy
By working with local partners, hyperlocal grocery stores help these businesses grow. This builds stronger relationships between your store and the community.
3. It’s easy to operate
With a convenient ecommerce platform powering your hyperlocal grocery store, delivery has never been easier.
Automation software, artificial intelligence (AI), and machine learning (ML) make it easy to achieve efficiency.
4. It offers increased transparency
Hyperlocal delivery services can provide customers with detailed updates about their delivery status. Shoppers don’t have to wait too long for their items to arrive at their doorstep.
How to build a hyperlocal grocery delivery application
To implement hyperlocal grocery delivery services, your tech stack should be up to the task. You need a comprehensive grocery ecommerce platform to manage grocery retail and delivery operations efficiently.
With the right ecommerce platform, you can provide hyperlocal services with minimal friction.
Before making the big shift to hyperlocal grocery delivery, keep these key considerations in mind:
✅ Establish your niche: Choose the best products to offer in your online store based on customer preferences.
✅ Target local customers: Conduct research to determine the number of potential customers for your delivery within the selected area.
✅ Raise brand awareness: Make consumers in your delivery area aware of your services through robust local marketing campaigns.
✅ Connect with local partners: Build relationships with local retailers, suppliers, and delivery agents to strengthen your localized supply chain.
Hyperlocal grocery delivery will be a popular choice for consumers moving forward. Offering such services will help your store increase sales and grow its customer base.
Use Wave Grocery to build a hyperlocal grocery delivery store that works just the way you want!
