Photo Credit: Vernon Chan/Flickr.com
The foodtech market in India once attracted considerable funding as it was considered promising. However, the market has now become overcrowded and price wars as well as weak logistics and delivery infrastructure are taking a toll on the industry. In 2016, over 37 foodtech startups in India shut down while nine were acquired. Former Billion Dollar Unicorn Club member Zomato had to slam the brakes on its heavy spending on acquisitions and focus on its unit economics.
Zomato’s Journey
Gurgaon, India-based Zomato was founded in 2011 by IIT graduates Deepinder Goyal and Pankaj Chaddah. The idea of Zomato came into being when the two founders noticed that a lot of people were lining up in their office cafeteria to look at the menu cards and order food. They realized that they could help these people by simply putting these menu cards online. Soon, Zomato was born.
Zomato is an online restaurant search and discovery service that has a portfolio of over 1.4 million restaurant listings across 23 countries. Through its portal, users can access restaurant menus, photos, locations for GPS, and even share ratings and reviews of restaurants. Zomato also has an active social network as it allows its users to create their own network of foodies. Through the social feature, users can check in at restaurants with friends and save a personal foodie timeline of their food memories. Today, it has a following of over 90 million monthly visitors globally.
Zomato earns revenues primarily through advertising. They have native advertising on their apps and site and also earn advertising revenues by charging restaurant owners a fee for publishing promotional offers through Zomato’s listings.
Zomato’s Initiatives
Zomato has also been expanding its service offerings. It now offers food delivery and a point-of-sale (PoS) system called Zomato Base that enables restaurants to manage their operations from a single platform.
