Covid Impact on zomato

 13% layoff 500 out of 4000 will get 50% salary or new job
 Amazon entry in online food delivery market (Bengaluru)
 Zomato Started home delivery of alcohol.
 Indian food delivery services Zomato and Swiggy started an information campaign after the
coronavirus pandemic had hit India, offered no-contact delivery and most recently partnered
with FMCG companies to bring essentials directly to homes. Customers are rewarding them
with more positive ratings, as seen in YouGov's Brand Index. According to YouGov, both
brands had initially lost support from customers on the ranking. Yet, customer base (the
number of respondents saying they planned to order from either platform) was still down
from 46.3 in mid-March to 41.7 in mid-April for Zomato (index values) and from 48.8 to 42.4
for Swiggy.
 Zomato plans on foraying into groceries delivery, and is in advanced stages of talks to join
hands with Grofers and BigBasket... (https://www.expresscomputer.in/news/zomato-plans-
a-bigger-game-amid-the-covid-19-outbreak/51140/)
 Zomato has launched a marketing campaign, 'Safety levels: Mom Approved'. Showcasing a
typical quarantine mealtime. The ad showcases the plight of a kid bored of another dal-day
at home. Until he decides to treat himself by ordering food online from Zomato. Scared that
his mom may not approve of this, every time he orders food, he says it's his neighbour
Rohan’s mom’s home-cooked meals. (https://www.youtube.com/watch?
time_continue=32&v=SIBQ7Ssj-Jw&feature=emb_logo)
 Food delivery startup Zomato doubled its revenue to $394 million in 2019-20, on a loss of
$293 million. In the June quarter, given the impact of covid, it reported revenue of $41
million on a loss of $12 million.
 In FY19, the food aggregator unicorn reported a revenue of $192 million and a loss of $277
million. The covid-19-led lockdown has severely impacted the food delivery business in India,
as several restaurants remained shut over the past few months, and home delivery orders
took considerable impact. “Right after the rise of covid-19 cases in India towards the end of
March, our food delivery GMV hit its lowest point in two years – GMV (gross merchandise
value) was 80% down in the last week of March 2020, compared to our peak pre-COVID-19
week (in mid-February)," said Deepinder Goyal, founder & CEO of Zomato. As of July,
Zomato’s food delivery GMV has recovered to 60% of pre-COVID levels.
 The Gurugram-based company also said that through the acquisition of Uber Eats, earlier in
January, this year, the startup also gained market share and reported a 108% increase in
GMV in FY’20. Zomato’s GMV increased from $718 million in FY19 to $1.49 billion in FY20.
Now, with growth being stunted, Zomato expects its burn rate to land under $1 million, and
monthly revenues to come back to 60% of pre-covid peaks, with full recovery expected in
the next 3-6 months. “Covid-19 has positively impacted the health of our business – we
seem to have gained 2-3 years along this vector. In July 2020, we estimate our monthly burn
rate to land under $1 million, while our revenue should land at approx. 60% of pre-covid
peaks ($23m per month). We expect to make complete recovery over the next 3-6 months
while continuing to maintain tight control on costs/profitability," said Goyal. Zomato also
accepted that the loss of demand it is facing currently is due to young professionals in large
cities migrating to their parents’ homes (often in small town India) where home cooked food
is the norm, especially during a pandemic. However, with offices opening up, Zomato is
expecting a sharp recovery. Along with this Zomato’s contribution margin also increased to
₹27 per order delivered, in the June quarter, this year. Last year, in June, Zomato was losing
₹47 per order for delivery. Additionally, Zomato’s revenues from dining out products also
increased to $56.1 million in FY20, as its loyalty programme, Zomato Gold (now Zomato Pro)
saw an uptick in subscribers, from 1 million in FY19 to 1.7 million in FY20. The company also
made significant additions for its Hyperpure offering, raking up $14.7 million in revenues,
and increasing its restaurant subscriber base to 2256 restaurants, by the end of FY20.
Hyperpure is Zomato’s initiative to provide fresh, hygienic, high quality ingredients and
kitchen supplies to restaurants.