Swiggy Instamart · Product sense · Mid · 45 to 60 minutes

Instamart retention in Tier-2 cities

Swiggy Instamart is Swiggy's quick commerce grocery service that lets users order everyday items for fast delivery. Answer this product management case and get it graded line by line against a weighted rubric.

Funnel diagnosis
Prioritization
Product strategy
Experiment design
Market empathy

The situation

You are the PM responsible for growth in Instamart's newer Tier-2 cities. The grocery GM has asked you for a recommendation before next quarter planning because user acquisition looks strong, but the business case is getting questioned. Assume recent cohort data for a typical Tier-2 market shows downloads to signup at 80%, signup to first order at 40%, first order to repeat order within 30 days at 20%, and repeat order to paid or high value behavior at 5%, all materially behind Tier-1 except the top of the funnel. Leadership is split on what to do next. Growth wants more offers, operations wants faster delivery and more fulfillment investment, category wants local assortment changes, and finance wants discount burn to come down. Some cities are still relatively new, so part of the debate is whether behavior will improve with time or whether the product is mismatched to local needs. You need to recommend what problem Instamart should solve first in Tier-2 cities, and what bets to prioritize over the next quarter.

What to produce

A 1 to 2 page product strategy memo.

Your answer must

Frame the core problem using the funnel, and explicitly separate acquisition, activation, repeat usage, and monetization.
List the most important clarifying questions, then state any assumptions you make to proceed.
Identify the top 2 to 3 hypotheses for why Tier-2 performance lags Tier-1, tied to likely users and offline grocery alternatives.
Recommend a prioritized next quarter plan with 2 to 3 product or business bets, including why each was chosen over other options.
Define success metrics, leading indicators, and a simple test plan with a scale, iterate, or stop decision rule.

Constraints

Keep the scope to Instamart grocery in Tier-2 cities, not Swiggy's full ecosystem.
Plan within one quarter, and avoid recommendations that depend on a large multi-city infrastructure buildout first.
Do not use ongoing deep discounting as the primary answer.
You may tailor by city cluster or segment, but you cannot propose a fully bespoke solution for every city.

Format

Use sections: problem, key questions and assumptions, diagnosis, options considered, recommendation, measurement.

How Swiggy Instamart actually played it

Works through why Instamart repeat usage and conversion in Tier-2 markets lag Tier-1 and what to change, with trust and value perception as hypotheses.

Different markets have different trust and value needs
Diagnose repeat behavior separately from acquisition
Pick solutions that match the market, not a copy of Tier-1

Built from Product Growth Case: Instamart in Tier-2 cities by Sreerag Panat.