Shiprocket bets on quick commerce, AI for growth

Shiprocket, an e-commerce logistics services provider, is strategically shifting its focus towards quick commerce and artificial intelligence to fuel its future growth. The company detailed this strategy during its first post-listing earnings call, signalling a move beyond its traditional domestic shipping operations.

The company's emerging business, heavily focused on quick commerce, now accounts for 30% of total revenue, marking a 70% year-on-year increase. This growth is attributed to its omnichannel platforms, Shiprocket Omuni and Shiprocket Cargo, which cater to both direct-to-consumer brands and offline retailers looking to leverage rapid delivery services. The demand for quick commerce solutions has surged as brands expand beyond groceries into fashion and electronics.

Shiprocket's CEO, Saahil Goel, highlighted the automation of quick commerce slot booking as a key development. Previously manual processes involving spreadsheets and emails have been replaced by an automated system that notifies Shiprocket of orders, assigns pickups, and books delivery slots, significantly reducing friction for merchants aiming to enter the fast-paced delivery market. This capability positions Shiprocket to compete effectively with rivals as quick commerce platforms broaden their offerings.

In the realm of AI, Shiprocket has launched four new tools designed to address common e-commerce pain points. These include Quikpay to reduce checkout abandonment, Steal Deal to increase average order value, AI Assist chatbot for customer queries, and AI Ads Platform for generating ad creatives. These tools aim to transform Shiprocket into a full-stack commerce enabler.

While the core shipping business continues to grow, with revenue up 22% year-on-year, Shiprocket has noted an increase in customer acquisition costs. Management attributes this rise to ongoing experimentation in reaching new customer segments and reactivating existing ones.