Did you know that Ready to Cook(RTC) is the next big billion market?

Swiggy has undoubtedly become a leading online food ordering and delivery company. Having changed the entire landscape of how India eats, its innovative business model has made the life of every foodie easier, tastier, and more fun. Of course not just the food from your favourite restaurants, Swiggy is also a marketplace that caters to other services like a dark store, courier services, flowers, meat and etc.

Swiggy to explore some of the edge opportunities to introduce the RTC-DIY market which is a missing gap in the current portfolio.

Firstly, what is RTC?
Food products that need some preparation, such as heating or boiling before consumption, fall under the Ready-To-Cook category, while the Ready To Eat category comprises packaged food items that are ready for consumption.

Secondly, Swiggy captured the market while addressing the following consumer behaviours:

• Customers who want to enjoy their favourite food at their doorsteps.
• Eaters who avoid going physically to restaurants and retail stores.
• Food lovers who love to make a purchase through digital tools

However, there is room for the opportunity; where Swiggy can explore with the RTC companies to address the pain points.

Problem:
Swiggy deliveries are delayed at times with the highest surge and by the time customers receive the food which is ideally a warm food instead of piping hot

Few customers find it hard that the food from different places doesn’t match their desired taste could be too oily or no salt or too much spicy

Solution:
RTC kit is a process of preparing desired food from your own culinary skills with the step by step process

Lets breakdown this problem by understanding the customer segmentation;

Currently, the majority of the market is concentrated in Metro and Tier 1 cities owing to the high purchasing capacity of the consumer in these cities. However, the increase in the awareness and the viability of these products in a smaller quantity is to allow the rural region to experience a growth of over 19% during the forecasted period.

Also, the brands’ products are present mostly in modern trade stores and Grade A/A+ general trade stores owing to refrigeration requirements for frozen RTC which limits their adoption beyond these stores. However, online platforms have provided an alternative channel of growth for brands in the category and have led to an increase in their presence across various regions in the country.

Mission Definition

Swiggy’s goal is to change the manner in which India eats by providing RTC-DIY kits.

Customer Journey

When a customer opens the Swiggy App, the services encompassing the products (restaurant listing, offers, pricing, customer care etc.,) query the Segmentation System includes the RTC for customer-relevant segments and these services render the feature based on their segment mapping.

Permission Testing

People mostly prefer a healthy regime while ordering food from these marketplace apps like Swiggy, Zomato, etc. However, the unmet needs are always not matching the desirability of consumers as follows:

1. Food to be prepared fresh and hot
2. Desired quantity per portion
3. Customization on food like less oil or less salt or spicier to less spicy is always a gap
4. Time to delivery of any food item is an average of 30 minutes to reach to consumer
5. If the RTC-DIY kits are ready in dark stores whether Frozen; vs non-frozen the time to supply these are less than 10 minutes and therefore 20 minutes to prepare the desired food based on the customers
6. Subscription is one of the models that can be enabled on RTC-DIY on each day/weekly

Business Model Formulation

The market size is vast and RTC will be lead to a choice of food options that allows instantly to cook based on your taste. Several leading ready to cook market vendors in India include Bambino Agro Industries Ltd., Gits Food Products Pvt. Ltd., Hindustan Unilever Ltd., iD Fresh Food (India) Pvt. Ltd., IndianFarm Foods Pvt. Ltd., ITC Ltd., Kohinoor Foods Ltd., MTR Foods Pvt. Ltd., Nestle SA, and REGAL KITCHEN FOODS LTD.

The market has not been steady in the past year because of the appearance of the COVID-19 pandemic. However, the consumer trend for ready to cook food market has picked up during the pandemic and is continuing well.

The Revenue model is to charge on each transaction on delivery and a 10% commission on each transaction from RTC vendors

To Sum it up

With its fast deliveries, live order tracking, and no restrictions on order amount, Swiggy is not far from taking a chance on the RTC-DIY model.

If you have feedback on this please feel free to reach me at my Linkedin

TIA,
Pradeep