Would you pay INR 50,000 to Swiggy
to be your personal butler?
Well, not quite a butler — that would be a disservice to what IPO-bound Swiggy is aiming for with the Rare Life concierge service that’s been making waves in India. Catering to the growing class of high-net-worth individuals (HNIs), Swiggy Rare Life is the company’s first punt at targeting the affluent class.
For the first 10 years of its life, Swiggy positioned itself as a service for everyone. But with Rare Life, that’s about to change. This is because of the potential in the concierge business, which inherently does not have a ceiling when it comes to the revenue. That’s actually a big deal for Swiggy which is about to hit the public markets.
Can Swiggy crack the concierge service code, and will it be able to match global and Indian platforms such as Indulge Global, Quintessentially India, RedBeryl, Pinch, One Concierge, among others?
Before we answer that, a look at the top stories from our newsroom this week:
- Meesho Courts D2C Brands: Meesho’s in-house logistics, cheaper ad rates, lower commissions as well as strong presence in Tier 2, Tier 3 markets are all huge draws for D2C brands, but will that be enough to dethrone Amazon, Flipkart?
- FirstCry’s Path To Profits: Even as FirstCry built an empire around the kidswear proposition, its recent investments have indicated an appetite for diversification to bolster its core business.
- Melorra’s Lost Shine: What exactly went wrong for D2C jewellery brand Melorra which once claimed to be building Zara for the jewellery industry in India, but now has to settle for a fire sale after two years of slowdown.
Swiggy Rare Life Taking Shape
While more information about Swiggy Rare Life will be announced in the days to come, sources close to the company gave us a peek at what it’s all about.
“The idea came from insights from Swiggy’s research on white spaces in the consumer services space. India’s HNI base is around 0.1% or 0.2% of the population, but this cohort lacks a service that’s differentiated for their segment. Yes, The TAM is low — around single digit millions in India at the moment — but this is a rapidly growing segment,” one of the sources said.
Another source privy to the development revealed that the service will be membership-based and will begin at INR 50,000. The top end of the pricing for Swiggy Rare Life is yet to be determined. “Affluent Indians are seeking convenience on a very different level. So there’s an opportunity to cater to them, which led to the concierge service and curating experiences they wanted access to.”
The model is fairly straightforward with an annual subscription, and no mark-ups on any requests made by the customer. Plus, there will be no service charges, so presumably the margins are built into the subscription layer. But Swiggy is also likely to earn commissions from event organisers, hotels, and other partners it ropes in to operationalise the experiences.
Rare Life will offer a concierge for every member and access to privileges such as live music, sports events, fashion shows, and other lifestyle activities.
Inc42 learnt that requests will be open-ended in nature, and can range from cab booking to travel planning to luxury shopping or access to particular events or shows. In addition, there will be some Swiggy curated events, which will potentially be linked to the company’s SteppinOut vertical, which was teased in the DRHP.
So far, only DineOut is a revenue contributor for SteppinOut. But Swiggy is testing the waters on some events, as we could see from SteppinOut social media channels.
“Swiggy Rare Life members will likely be able to request for any service that does not violate Indian laws. Events and experiences will be ticketed separately and these will be at market or below-market rates,” another source said.
While Rare Life is not built as a networking club, the sources did mention that members will have opportunities to engage with each other at events. But networking is not the top priority for the Rare Life team.
In fact, there will be a plus-one option for all events so it’s not only about the members but also their loved ones. It’s not yet clear whether Swiggy will entertain inbound queries from individuals to join the Rare Life platform.
One month into the launch, Rare Life has not yet been opened up for other members. “It’s limited and invites have been selectively sent out. The focus is on ensuring consumer delight, and the service will have a referral or invite-based membership system,” one of the sources cited above said.
As for the operations, there’s little clarity on that too. Currently, there’s a team within Swiggy working with members directly. But these are early days, and more clarity is expected soon.
Swiggy Vs Concierge Startups
One thing is amply clear about the concierge service business. This model is built around manual intervention and execution. Founders of concierge services believe that the HNI class is not quite open to virtual assistants, and the tech part in this business is largely used in the backend for scheduling, managing dates, and bookings.
Swiggy Rare Life, for example, is built around a web interface. Even if there is an app, it’s most likely going to be separate from the Swiggy app.
“You cannot solve problems for HNIs using a chatbot, for instance. You need to have humans available round the clock and people around the world to ensure top notch service,” the India CEO of a global concierge platform told us on the condition of anonymity.
The CEO didn’t want to comment on Swiggy Rare Life because they felt at the moment it is not comparable to high-end concierge services.
As per industry sources, the membership for platforms such as Quintessentially India, RedBeryl, Indulge Global begins at INR 3.5 Lakh per year, and goes up to INR 35 Lakh per year. Indulge Global’s pricing is INR 4 Lakh per year, while RedBeryl’s invite-only platform has a joining fee of INR 5 Lakh and a separate annual fee.
In the concierge space, pricing is used as a filter for the right customer persona. Swiggy’s INR 50,000 starting price seems rather affordable in comparison to others.
Service Quality Is Paramount
This brings us to one of the biggest challenges in operationalising concierge services. Swiggy needs to diversify its talent acquisition as well as partnership model towards the hospitality and luxury lifestyle industry. Despite the adjacency to the restaurant world, this is something of a new territory for the tech-first company.
Indulge Global cofounder Advita Bihani claimed the two-year-old startup is “building the world’s most expensive app”. She believes that having the right talent that can go the extra mile is critical for the concierge space.
“Partnerships will only take you so far, you need people on-the-ground to manage the members’ needs and ensure service quality. For one particular order, one of our executives had to fly to the UAE to pick up a rare item and get it cleared through customs in India,” she added.
Goa-based Indulge claims to have over 1,000 members, with a 90%-plus retention rate. It counts the likes of CRED founder Kunal Shah, Udaan’s Sujeet Kumar, Zerodha cofounder Nikhil Kamath, actors such as Mouni Roy, Anshula Kapoor, and Tanmay Bhatt among its members.
The point is that Swiggy needs to rewire its customer service outlook entirely. The founder of a Delhi NCR-based platform added that even within the HNI class, there are segmentations. “Once you go from HNIs to ultra HNIs, the service expectations are altogether different. And you need to have continuity in operations. Any service executive should be able to pick up from where their colleague left off,” the founder added.
Besides, there are other nuances to account for in a country like India. Bihani acknowledged that there have been attempts to target the HNI base with concierge services in the past as well. “These attempts were not very fruitful because the fabric of the country is very different. I have personally gone across the length and the breadth of the country and sat across these individuals to understand what convenience and luxury means to them. The answers are very different in Kerala than in Delhi,” she told Inc42.
Swiggy’s Trump Card
A lot about Swiggy Rare Life is not yet clear. But we do know that it will be targetting use-cases that are much more high frequency. In contrast, most other platforms and startups in this space are trying to unlock unique experiences that the wealthy want but can’t plan for.
For instance, one of the sources said that Swiggy’s vision is “elevating everyday” for Rare Life members. But those building in the space feel it is about creating experiences that don’t feel like every other day.
“You cannot serve HNIs with the same model that you might use for the mass-affluent class. It requires a higher degree of attention to detail and round-the-clock presence. It’s not easy to do this with a small and hungry team, you need resources and talent around the world,” the CEO of the global concierge platform quoted above added.
There’s little doubt that Swiggy is eyeing a new audience altogether. Its food delivery and quick commerce platform has 14 Mn-plus users. In contrast, the HNI base in India topped out at close to 3.6 Mn individuals, according to the World Wealth Report 2024.
Serving such a small base — even if it may grow larger every year — requires a different approach than what has worked for Swiggy thus far. A lot of that has to do with the fact that HNIs are willing to spend but only for the right service.
To its credit, this is a rather courageous and ambitious move by Swiggy. Zomato has so far not shown the appetite to venture into the concierge space. Will Rare Life turn out to be the trump card for Swiggy in its showdown against Zomato?
Sunday Roundup: Tech Stocks, Startup Funding & More
- Weekly Funding Falls: Indian startups cumulatively raised $145.5 Mn across 10 deals, a 70% decline from $478 Mn raised in the previous week
- Paytm Back In The Black: The fintech major reported a PAT of INR 930 Cr in Q2 FY25 against a loss of INR 292 Cr in the year-ago period. Revenue from operations fell 34% YoY to INR 11,660 Cr. Paytm has also received the NPCI nod to onboard new UPI users
- RIL-Disney Merger Takes Shape: The combined entity plans to keep Disney+ Hotstar as its sole streaming platform. Reliance is said to have chosen Disney+ Hotstar over JioCinema for the former’s superior tech infrastructure
- NVIDIA’s India Pitch: NVIDIA founder and CEO Jensen Huang said that India will have nearly 20x more computing infrastructure by the end of the year to fuel the AI revolution
- Platform Fee Hikes: Foodtech majors Zomato and Swiggy have both hiked their platform fee to INR 10 to cater to the festive season rush
