HappyFresh Aims to be All-in-One Marketplace for Grocery, Focusing on Partnerships and Consumer Experience

The pandemic has led to an unprecedented increase in several online services, including e-grocery, driven by mobility restrictions and offline shopping security concerns. Filippo Candrini, the Managing Director of HappyFresh Indonesia, the country's leading marketplace for groceries confirmed this statement and break down some of the mechanisms in reaction to this transition.

"This pandemic has shifted the way many businesses operated. HappyFresh, as one of the first digital companies operating in the online grocery industry, has experienced a surge in service usage. It obviously becomes a growing trend since the pandemic started," he said.

After one year of pandemic, HappyFresh managed to operate without stressful conditions. In a very short time, the company has doubled its fleet numbers, gained new consumers, and improved services. However, it is important to highlight the fact that the pandemic does not seem to fade away.

"What we’ve done, last year we did improve the backend and front-facing to help accommodate better, a feature that limited certain products in a mass quantity to avoid rhetoric purchases, contactless delivery, more payment methods, tested our fleet, all the things we’ve done and left continuing to do are basically have been stacked up on our plan," Candrini added.

All-in-one marketplace for groceries

HappyFresh positioned its platform as the weekly or monthly groceries. The company declared to focus on groceries and not venturing in different verticals. The platform focused on catering to the largest portfolio of supermarkets in Indonesia with a nutritious selection of specialty stores and anything complementary to groceries.

"We don't have any intention to become the super app, instead we want to be super at doing groceries for customers and our partners," Candrini added.

In terms of target market, the platform intends to be a service that can cater to any customers. Not only for the middle to upper segment, but also the mass market. The demography also shows around 80% of its consumers are women aged 25-40 years. Working parents and single professionals also represent a large group of its customers. 

"Many of our customers shopped online in 2020 for the first time, and they continue to do their weekly or monthly shopping today because they feel comfortable: our trained Personal Shopper and Rider partners will select and deliver groceries to their homes while they can dedicate time. for what they love most, forgetting the hassle of traffic, queuing or carrying heavy bags, and also enjoying unique online promotions," Candrini told DailySocial in different occasion.

Convenience works different with each individuals, it can be delivery speed, price tag or detailed information. However, during pandemic it also means health security. Across all these spectrums, HappyFresh focused on delivering high-quality products and better consumer experience. It includes providing personal shopper and special packaging to ensure the product's freshness.

HappyFresh is very strict on the quality of products they delivered. Therefore, most of the deliveries are made by its own fleet. They only pass the eligible order to trivial partners and it is said less than 5% of the total volume. In terms of product delivery, they currently partnered with Grab and Lalamove.

"We tried to be very personal with our products, therefore it's important to create a very customized and personalized flow for each user," Candrini added.

There are two main sources of monetization in this platform, service fees from partners and delivery fees from consumers. In that regard, the company will try to generate equal value for partnerships and consumers. 

Earlier this year HappyFresh also launched a new rewards program. The system is quite simple: earn points for every order delivered and exchange it for a discount on the next purchase. Every order will get you closer to becoming a Gold member to get more exclusive benefits. Last April, the platform also includes OVO as a new payment method.

Aside from HappyFresh, there are also several platforms providing online grocery services with different value propositions, including SayurBox and TaniHub. 

Expansion strategy

Aside from Indonesia, HappyFresh has also available in Malaysia and Thailand. With a mission to provide an online delivery service for household needs for all families in Southeast Asia, also to make life easier for many people, the platform is trying to reach a wider market by intensifying local expansion.

A recent study from Alpha JWC Ventures and Kearney predicts that tier two and three cities will account for 48 percent of e-commerce activity in Indonesia by 2025, up from 30 percent in 2020. Candrini said this is in line with HappyFresh's commitment to continuously improve services that is available for all Indonesian households.

“Each city and service area requires a special approach. We have formed partnerships with local supermarkets and national retail companies, as well as held programs to raise awareness of the benefits and convenience of online shopping for the household needs (to the public and new users)," he added.

In Makassar, HappyFresh has established partnerships with several supermarkets, such as Lotte Mart, Hero, and Giant. While in Bogor, HappyFresh has partnered with Giant and Tip Top. In total, the platform has partnered with 400+ supermarket and available in 11 cities across Indonesia, including Jabodetabek, Bandung, Surabaya, Malang, Semarang, Makassar and Bali.