South Africa's Takealot bets on Mr D to drive on-demand delivery expansion
Mr D, which before the COVID-19 pandemic focused on doorstep food delivery, has been repositioning itself as a broader convenience marketplace, a strategy born out of desperation five years ago when restaurant operations were restricted.
As competition intensifies in the e-commerce sector of Africa's most developed economy - with the notable arrival of Amazon (AMZN.O), opens new tab last year - Mr D is leveraging the shift to attract more customers and expand its market share.
Takealot Group, which is owned by technology investment group Naspers (NPNJn.J), opens new tab, is betting big on Mr D to lead its next phase of growth as consumers demand more immediacy and convenience, its chief executive said.
In addition to Amazon, it is going head-to-head against other international rivals like Uber Eats (UBER.N), opens new tab and local players Shoprite (SHPJ.J), opens new tab, Checkers Sixty60, and Pick n Pay ASAP!
"Pets is one big category we're going to expand quite aggressively on. And it's not just pets. It's speciality pet food delivered on demand," Frederik Zietsman, Takealot Group CEO, told Reuters in an interview.
Mr D also recently launched a partnership with Toy Kingdom, activating 24 stores nationally for on-demand delivery.
Zietsman said the company's strategy is to work with well-known retail brands that lack the logistics and digital infrastructure to offer their own rapid delivery service.
"We've got a clear vision of what that will be in terms of what categories come next," he added. "We look at, for example, is there a play in DIY? Is there a play in pharmacy? Is there a play in sports or baby? Like, what are those things that you truly appreciate on demand?"
Food still forms a major part of Mr D's product categories, but a bulk of that 70% share is composed of groceries delivered through a partnership with retailer Pick n Pay (PIKJ.J), opens new tab.
The strategy is to have a 50-50 split between food and other non-food categories in the next five years, Zietsman said.
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