Sandhya runs a small bakery, popular in her neighbourhood in Koramangala, Bengaluru. Known for her delicious pastries and artisanal breads, she had a loyal local customer base. However, her reach was limited to a 5 km radius, relying heavily on word of mouth. She wanted to build her online presence but when she enquired about the food apps in the market, she realised how much commission they charged; she would make no money! She faced tough competition from established outlets and struggled with costly delivery options.
During a food festival, she was introduced to a food delivery app that was part of the ONDC Network, and promised unbelievably low fees and assurance of customer acquisition across the country along with logistics capabilities.
Only thing she had to do is digitise her catalogue and ensure it is updated on a regular basis. Soon after, she was onboarded by the food app and was able to build a solid online loyal base in no time.
Sandhya’s success story is part of a larger trend, as many sellers across India are joining the ONDC network, making the ONDC network more inclusive.
This quarterly newsletter provides a glimpse into the far-reaching impact of the ONDC Network, showcasing milestones to celebrate and valuable lessons for continued success in the future.
Rising bakers and beyond: The surge of sellers on the network
Growth in total sellers
(Q2 – Q3 2024)
63%
Growth in active sellers1
(Q2 – Q3 2024)
22%
Between Q2 and Q3 2024, the total number of sellers on the ONDC network increased by 63%.
While this is largely due to the influx of new Seller Network Participants (Seller NPs) joining the network, the existing Seller NPs are also realising the value proposition of the network by enabling more sellers to get onboarded.
A big shout-out to our Seller NPs who have shown exceptional growth by adding the highest number of new stores2 in the last quarter.
While ONDC network felicitates the growth of sellers on the network, it is critical to ensure that they are able to fulfil orders from the network. And we do see that the Active sellers, i.e. sellers with at least 1 order on the network also grew by 22% in this time period.
This trend is true across all Seller NPs, but let’s highlight the ones where half of their onboarded stores are actively fulfilling orders.
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1 Active sellers are defined as those with at least one fulfilled order on the network.
2 For new stores, only Seller NPs with at least 50 stores in Q2 2024 are included in the growth assessment. Seller NPs are selected based on a minimum 45% growth in stores from the previous quarter across multiple cities. The share of existing and new stores is scaled to 10 in the pictogram for illustrative purposes
Repeat business or referrals are the best compliments
Among active sellers fulfilling orders, there is a healthy balance of new sellers³ and sellers with recurring sales⁴ in last 6 months that showcases the network’s ability to attract newcomers while retaining the loyalty of established participants.
With 8 out of every 10 active sellers making recurring sales, the network demonstrates a strong foundation of trust and satisfaction, reflecting the value these sellers find in the network.
Across categories, there is strong seller retention and newcomer presence on the network
Recognising Seller NPs with exceptional growth* in new active stores
*Highest growth among Seller NPs with at least 50 stores in Q2 2024 considered for this assessment.
In the fast evolving landscape of digital commerce, sellers with recurring sales on the ONDC network serve as a vital indicator of seller performance and customer loyalty.
Seller NPs with strongest repeat engagement⁵ on the Network
³An active seller is classified as new in the month they place their first order starting April 2024
⁴ If the seller reappears in any subsequent month after April, they are then considered repeat or seller with recurring sales.
⁵The repeat rate for each Seller NPs is calculated as the percentage of repeat instances divided by total instances in each month. Only Seller NPs with at least 50 stores in April 2024 are included in this assessment. The top 5 Seller NPs with the highest increase in repeat rate from May to September are highlighted.
Build for Bharat
The network is building a strong pan-India presence, attracting sellers from all corners of the country, with seller presence in 750+ districts.
Till now, digital commerce is largely concentrated in major tier-1 cities, which are key economic hubs in India. However, tier-2 and tier-3 cities are gaining traction, now accounting for three in ten sellers on the network. Cities like Bangalore and Delhi continue to lead, but the growing participation from smaller urban areas shows the expanding reach in seller engagement across the country.
A pan-India seller base: While Bengaluru and Delhi lead, one in three active sellers is in Tier 2 and Tier 3 cities
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However, it is not only the presence of sellers in a specific city but the demand for the seller from cities across India, which paints the true picture of the digital commerce landscape that the network is trying to reimagine.
ONDC network is not just aiming for local presence, but also for growth of regional sellers that leverage their unique value proposition to build products and services that can be delivered across the country seamlessly.
In the flow of zonal commerce below, these trends emerge⁶. For example, in the categories of Beauty and Personal Care, or in Fashion, the demand of Tier 3 cities is currently being fulfilled by Tier 1 cities.
Zonal commerce: Tier-1 for essentials, Tier-2 & Tier-3 drive beauty & wellness demand
⁶Location for active sellers is defined based on the seller pincode. Location for orders is based on delivery pincode in the confirmed order data.
I enjoy it fast and fabulous!
Some may like a fancy fine dining experience, yet some like to eat from their favourite next-door dhaba. The presence of Quick Service Restaurants⁷ (QSRs) on the Network varies by the city.
Bengaluru Loves a Quick Bite
QSRs are just 18% of Bengaluru’s restaurants on the network, but they make for more than 50% of the orders in the city.
Surat, the QSR Hotspot
With over 70% of the orders from branded Quick Service Restaurants, Surat stands out as a hub for quick meals.
Delhi and Lucknow Love Local
Residents in both cities have a taste for more traditional, local eats, the presence and demand for QSRs is low.
Chennai's QSR Craze
Over 60% of Chennai’s restaurants are QSRs, catering to the city’s high appetite for quick, convenient meals.
Quick bites: QSRs penetration and demand across cities
Take a look at the QSR orders landscape across states of India:
Southern coastal states of Kerala, Goa, Andhra Pradesh, Tamil Nadu show strong preference for convenience and quick-service food.
In the North, Delhi and Uttar Pradesh show a strong inclination towards local food outlets.
Western states of Gujarat and Rajasthan show a balanced mix of QSR convenience and preference for local flavours.
A taste of convenience: India’s QSR landscape
⁷Quick Service Restaurants (QSRs) are branded fast food chains such as Domino’s, McDonald’s, KFC, etc. Location for orders is based on delivery pincode; location for sellers is based on the pincode where they are registered.
This edition celebrates the remarkable growth of sellers on the ONDC network.
From the bakery in Koramangala, where Sandhya transformed her local business into a thriving online store, to the diverse sellers across India, the Network is expanding fast.
Joining ONDC network is about more than just an online presence; it’s about creating a sustainable, nationwide ecosystem where regional sellers like Sandhya can tap into new markets, build long-term customer relationships, scale their business and flourish!
The rise of sellers from diverse categories and regions showcases the potential of the network to reshape India’s digital commerce landscape, one seller at a time.