Pricing & Revenue Optimization
BigBasket™ Subscription Pricing Strategy
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RK
Rajesh Kumar, Senior Partner
Good morning! I'm Rajesh Kumar, leading our retail practice. Today we'll be discussing BigBasket, India's largest online grocery platform. They're facing a critical decision about their subscription pricing strategy. Are you ready to begin?
Client Context
BigBasket is India's pioneering online grocery delivery platform, founded in 2011. The company operates in 30+ cities and serves over 20 million customers.
Key Business Metrics
Company Overview
Market Data
Current Subscription
| Metric | Value | YoY Growth |
|---|---|---|
| Annual Revenue (FY23) | ₹7,200 Cr | +32% |
| Active Customers | 20M | +28% |
| Average Order Value | ₹1,850 | +12% |
| Monthly Orders/Customer | 2.3 | +8% |
| Gross Margin | 18.5% | +2.3pp |
The Challenge
BigBasket's CEO wants to revamp their subscription program to:
- Increase subscription penetration from 6% to 20% of customers within 18 months
- Improve unit economics and contribution margin
- Defend against aggressive competition from quick-commerce players
Your task: Design a new tiered subscription pricing strategy that maximizes customer lifetime value while achieving the penetration target.
Select Your Approach
Choose a framework to structure your analysis: