How many of us like ordering food home. 2000’s kids know how difficult it used to be to order home where the delivery guy used to come 1 or 2 hours late. How Zomato revolutionized the food delivery market. But does anyone know how they offer such great discounts and still earn money? Where do they generate revenue from o how Zomato earns by listing restaurants?
Zomato is a delivery service founded by Deepinder Goyal and Pankaj Chaddah in 2008. It provides information, menus, and reviews of different restaurants in your nearby locations. Deepinder and Pankaj used to work in Bain And Company and they saw the big queue in the canteen where people used to get confused looking at the menu that they wanted to eat. That’s how Foodibay’s concept came in 2008 and in 2010 they changed the name to Zomato.
Tagline – ” Discover Great Places To Eat Around You”
- Till date, Zomato has grabbed a total of $225 million in funding.
- The number of monthly users on Zomato platform has reached up to 19 million.
- Zomato has partnered with more than 4000 restaurants in India.
How Zomato earns
One of the main sources of income is through advertisements. Restaurants pay Zomato a certain amount of money to feature their restaurant on their app and website. This generated 50-70% of their income.
Restaurants pay a certain amount every month to Zomato which in turn Zomato provides them an analytics tool. What customers like or what’s the most preferred dish. The tool is Zomato Order. Another tool is Zomato Book where they inform customers about reservations in a place.
We all know about Zomaland and many other events where Zomato has sponsored. How they earn is not only through ticket sales if a restaurant wants to put their stall there they pay a certain amount to Zomato.
Zomato also provides consultancy to new restaurant owners. For example, you decide to open a restaurant in a particular area but you don’t know what cuisine people in that area prefer, you can contact Zomato.
Recently Zomato has also entered in delivering groceries. It allows restaurants to buy fresh meat and vegetables from the market.
Zomato Gold is a premium subscription offered by Zomato which only came in last year. You get offers from limited restaurants like 1+1 on food or drinks. This generates 10-15% of their income.
Is Zomato Profitable
First of all, Swiggy is an online delivery service unlike Zomato you don’t get features like reservation or Zomato Gold. Some people might enjoy no minimum order by Swiggy whereas some might enjoy complimentary dessert by Zomato. Both the platforms are performing exceptionally well even though we might have faced many issues regarding delivery. Well, again there are a lot of factors that play an important role like preparation time, logistics, internet speed, etc. As of 2019, Swiggy holds the largest market share 50% then Zomato at 26%. If you feel Zomato has lost which isn’t true because it’s operated in many other countries outside India. Zomato has been profitable overall.
Zomato coming has revolutionized the delivery market and with Swiggy and FoodPanda the market is growing rapidly. I personally feel the market hasn’t reached its full potential many innovations can get this industry to its full potential.