Hyperlocal services refers to online business models that provide various products and facilities that rely on the platform of smartphones with GPS technology. The offerings include food delivery from restaurants, grocery from superstores or hypermarkets, logistic services, and home utility services such as electrical repairing, plumbing, carpentry, laundry, and personal tutors.
Increased adoption of smartphones featuring internet connectivity is the prominent factor driving the industry growth
According to GSM Association Intelligence report in October 2016, around 44% of the total smartphone users, had subscribed to internet connectivity which is projected to account for around 60% by 2020. Moreover, hyperlocal services market participants are increasingly enhancing search options and application support for better consumer experience. Proliferation of improved and secured mobile payment gateways such as, Android Pay, Apple Pay, PayPal, etc. has led to significant increase in consumer confidence for the application of mobile platform for transactions. These factors are expected to provide strong industry growth prospects through the forecast period.
Hyperlocal services Market Taxonomy
On the basis of service offerings, the global hyperlocal services market is classified into:
Grocery and food delivery services
Home utility services
Large discounts on first purchase and competitive product offering costs are expected to present potential growth landscape
The hyper local services market is characterized by the presence of large number of local players venturing for better business growth prospects. Moreover, some competitors have entered into significant private ventures offering capital investments to the start-ups for enhancing their presence through marketing and promotional activities for acquiring large consumer base. This has led to increased competition among the global and local players in the industry, in turn leading to frequent major discounts and competitive pricing strategies for consumer retention. Large savings on purchases and increased consumer convenience owing to easy accessibility to resources is expected to present solid growth prospects for hyperlocal services market.
Grocery and food delivery segment dominated the global hyperlocal services market share
Grocery and food delivery segment participants perform the aggregation of local restaurants and superstores through smartphone applications and provide products on demand. This helps participants gain the trust of the local shops through online shopping. Moreover, owing to presence of large untapped potential consumer base and almost everyday requirements of foods and groceries will drive growth of these market segments.
Expansion of product offerings to rural and remote locations is expected present consistent challenge over the forecast period
Catering to customers with best product quality with access to marginal profits is major challenge hindering the market growth. Increasing consumer base and business activity may also lead decline of the product quality that can result in loss of consumer retention. Industry is characterized with large number of global and local choices available in the industry, causing increased consumer volatility. Moreover, customer catering potential of these hyperlocal service market is limited to urban regions only. These factors are expected to consistently challenge the business growth of the players.
Developed economies such as the U.S. and countries in Western Europe have witnessed major adoption of hyperlocal services and are leading the market in terms of revenue and consumer base. However, with the increasing proliferation of mobile devices in emerging economies such as China, India, Indonesia, and Brazil is expected to offer significant growth opportunities for market players over the forecast period.
Industry is characterized by the presence of large number of players acquiring small hyperlocal services market shares. This is expected to continue over the forecast period, however, few industry participants have gained competitive edge over other participants. These participants include GrubHub, Just-Eat, Swiggy, Delivery Hero, Foodpanda group, BOXC, Shipster, and HelloFresh Group.
About Coherent Market Insights:
Coherent Market Insights is a prominent market research and consulting firm offering action-ready syndicated research reports, custom market analysis, consulting services, and competitive analysis through various recommendations related to emerging market trends, technologies, and potential absolute dollar opportunity.
Coherent Market Insights
1001 4th Ave,
Seattle, WA 98154