Zomato Business Model & Revenue Insights [In 2022]

Rainy days call for hot pakoras; hot days call for popsicles or smoothies (if you are into clean eating.) We never know when that gourmet in us comes unleashing, only to leave our stomach grumbling! Can’t stop thinking about that mouth-watering dish from a joint in your locality in the middle of a hectic day? No worries, that’s where online food delivery systems like Zomato come to our rescue. With a few taps, you can relish that dish in no time.

What is Zomato?

Zomato is an online food delivery system that caters to our needs and ensures prompt delivery. Launched in 2008, it has been on a mission to ease the process of food delivery. Zomato is now well-known across the country and has been venturing into international markets. Zomato currently serves 25 countries.

Growth over the years

It all started when the founders saw their colleagues waiting indefinitely to order food. That is when the idea of ordering food through mobile applications came to life. Initially known as Foodiebay, it uploaded soft copies of menu cards on the website. Traffic on the website increased. Zomato has become one of the most successful start-ups in India, with over 1 million users across the globe.

How Zomato Works?

Zomato makes it pretty easy for customers to order food from restaurants. Let’s see how it works:

The user looking to order food goes through the list of restaurants on the app and selects the food from the outlet that interests them.
Upon receiving a request from the user, the hotel begins to prepare the meal.
The food is then ready to be delivered.
The user then makes a payment through any of the payment options provided by Zomato.
Based on the quality of service, the user leaves behind a review.

Zomato Business Model

Customer Segment

The customer segment of Zomato constitutes the following groups:

Users: The online food delivery system intends to serve its customers by enabling them to order food from outlets in their locality through the food delivery application system.
Local outlets: Local food businesses get listed on the app for the users to navigate through the list.
Delivery Partners: Delivery partners are paid handsomely by the food delivery platform.

Zomato Value Proposition

Zomato has carved a niche for itself by striving to offer uncompromising services. It promises quality, accessibility, affordability, and range.

Zomato provides Gold Membership- an excellent marketing strategy that has reaped benefits. The membership unlocks dining privileges for the users. With this privilege, Zomato claims to get the orders delivered 15-20% faster. Pro members can also enjoy offers across a wide selection of restaurants.

Partners

Zomato’s business model saw enhancement through partnerships with leading giants like Uber Taxi, Visa, and PayPal. Such alliances have undeniably improved the business model of Zomato.

Revenue Streams

Zomato has amassed a considerable income over the years. Following are some of the food delivery giant’s sources of income:

Listings and Advertising

Zomato partners with restaurants to promote them. Restaurants that partner with Zomato experience increased visibility by getting listed. Naturally, this enables them to attract a wide audience range.

Zomato doesn’t just promote restaurants without charging. So this is how this food delivery system manages to make the most of its profit.

Food Delivery

Restaurants are mandated to pay a fee for the orders placed through Zomato. Users also pay for the delivery through its food delivery system.

Zomato manages to make only small margins due to the competing nature of the food delivery business and the inclination to offer discounts.

White Label Access

Under Zomato Whitelabel, Zomato enables restaurants to develop a customized food delivery app. The service is available to restaurants in all the countries where it operates, helping people interact directly with the restaurants they frequently dine in.

Zomato Subscription

Zomato’s algorithm enables the food delivery system to make presumptions about customer needs. This data can be valuable for restaurant owners looking to make their food business more profitable. In exchange for this valuable data, restaurateurs get subscribed.

Zomato Kitchens

Zomato brought forth the concept of Zomato kitchens to offer kitchen infrastructure services to businesses that look forward to expanding with minimum cost.

Wrapping Up

Zomato has witnessed steady growth since its inception. Its success has been crucial in prompting this food delivery platform to expand to a global level. One can’t deny how big of a household name it has emerged to be. For sophisticated gourmets, such food delivery systems are a blessing. With a few taps, if one can relish their favorite pizza in the comfort of their home, what more can one ask?

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