1.

1 BRIEF HISTORY OF THE INDUSTRY

The business of delivering ready-to-eat foodstuffs from restaurants to home is

undergoing a sea change as new online platforms enable food providers to capture
markets and customers day by day. Worldwide, the food delivery market stands at 4
percent of food items sold through restaurant chains and fast-food outlets. This market
has already matured in many countries with a growth rate estimated at 3.5 percent for
five years down the line (McKinsey, 2016). The picture is not so different in our
country as well. The conventional mode of food delivery wherein customers order
food online through the websites of restaurants, or fast-food chains has now been
replaced with the concept of 'aggregator business model.' Here the business player
provides a 'single window system' enabling the customers to order food online from a
wide variety of food providers registered on the portal. The 'aggregator' would charge
a fixed margin of the order from the food provider and in turn, handles the delivery of
the food item at the doorstep of the consumer. The focus has now shifted from
technology to logistics, which is currently acting as the major cost driver for the food
industry. Despite escalating traveling and vehicle maintenance costs, these food
delivery companies make profits by up to 30% (Mckinsey, 2016). Indian consumers
habituated to the online shopping experience through digital apps and e-commerce
websites with maximum convenience and transparency would expect the same when
it comes to the matter of online food ordering as well (Kapoor and Vij, 2018). Just
next to grocery items, food delivery proved to be a big opportunity for Indian e-
commerce companies. The online food delivery market in India, comprising of
aggregators and internet kitchens, showed spectacular growth in recent years. The
market in India is of the tune of 15 billion USD and is all set for an exponential
growth phase (Kanette, 2018). The sector is very competitive, and the growth of
online food ordering via digital platforms made the businessmen and entrepreneurs
awake and took notice. Some popular 'food aggregators' like Zomato, Swiggy, Food
Panda and UberEATS are feeding the Indian cities online and making decent profits.
Various food delivery web portals and mobile apps offer the rational Indian customer
a direct comparison between the prices and rating of different food outlets and
restaurants serving the same dishes and to choose among the various options (Gera et
al., 2018).

1.2 BUSINESS PROCESS OF THE INDUSTRY

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Ordering – Orders are customer requests to prepare and deliver food. All food on-
demand businesses receive orders via an app, a website, or phone. The orders could
be for their kitchen or another meal provider they have partnered with.

Cooking– Meals could be pre-cooked or cooked after an order is received, based on

this Cooking time is estimated for the Food Delivery app.

Delivering – The transportation of Delivery is the backbone of any on-demand

business. Businesses can have different Food delivery models depending on various
factors.

1.3 MARKET DEMAND AND SUPPLY

The rapid rise in the number of smartphone users in the country with the availability
of affordable options is expanding the consumer base of the online food delivery
industry in India. The rising penetration of the internet due to cheaper data rates is
also aiding the market. With the major players expanding away from their traditional
metro bases to smaller towns and cities, the industry is being further propelled
forward. The industry is finding impetus for its growth in tier-2 and 3 cities in the
introduction and expansion of delivery-only kitchens in places with limited restaurant
and cuisine options. The increase in marketing campaigns by the leading players is
also aiding the industry.

The industry is being driven by the incentives offered by the platforms like discounts
and memberships, which are attracting more consumers to these online delivery
platforms. The increased funding received by the industry along with the rise in the
self-owned delivery fleet by the major players is providing further impetus for the
industry growth.

The industry is being driven by the growing number of the busy white-collar worker
who is increasingly looking for convenient and quick meals. With a growing number
of women joining workplaces and increasing prevalence of double-income families
who prefer eating-out frequently, the online food market in India is being further
propelled forward. The growth in the economy, along with an increase in household
income is likely to drive the market in the coming years with consumers spending
most on food, household, transport, and communication segments. The rise in the
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population of the younger population with higher disposable incomes will provide
further impetus to the industry growth as they define the food consumption patterns.

REVENUE GENERATED

Revenue in the Online Food Delivery segment is projected to reach US$11,666m in

2021. Revenue is expected to show an annual growth rate (CAGR 2021-2024) of
7.9%, resulting in a projected market volume of US$14,670m by 2024.

The market's largest segment is Restaurant-to-Consumer Delivery with a projected

market volume of US$5,960m in 2021.

In global comparison, most revenue will be generated in China (US$56,936m in

2021).

1.4 LEVEL AND TYPE OF COMPETITION

The Indian food delivery industry is going through a phase of consolidation to survive
and stay competitive in the market. This consolidation is taking place because the
smaller players in the market want to exit and the cash-rich players want to continue
on their growth trajectory. Ola has recently acquired Food Panda and Food Panda has
acquired Hola Chef. This consolidation is a result of a fresh inflow of institutional
money.

As the barriers to entry are fairly low due to the unsophisticated business model, the
incumbents constantly face the threat of new competitors in the market which in turn
puts pressure on the already wafer-thin margins. This can be gauged from the fact that
between 2013 and 2016, there were 400 food delivery apps.

Newer entrants that are leveraging Artificial Intelligence are also garnering investor
interest. The current big four of the food delivery industry- Food Panda, Zomato,
UberEATS, Swiggy need to keep expanding the coverage of the restaurants,
serviceable areas and rework their pricing

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models to stay competitive and grow. The high cost of customer acquisition combined
with low switching cost makes this an industry with a high cash burn rate.

Product Segmentation and innovation in terms of backward integration (i.e. setting up

kitchens to cater to their customer's tastes and preferences) would make their business
models sustainable and the food delivery industry exciting; the industry is expected to
reach $ 2.5 Billion in turnover by 2021. The backward integration move would bring
them in direct competition with kitchen-based food-tech companies such as Box8 and
Faasos.

App downloads and Ratings on Android:

 Zomato- 702,184 (4.3 stars)

 UberEATS- 488,822 (4.2 stars)

 Swiggy — 342,133 (4.2 starts)

 Food Panda — 1,49,030 (3.3 stars)

App downloads and ratings of kitchen-based food-tech ventures on Android:

 Faasos- 96,725 (4.1 stars)

 Box8- 28,727 (4.2 stars)

1.5 PRICING STRATEGIES IN THE INDUSTRY

Based on the current pricing methods used popularly in the fast-food market, cost and
value-based pricing methods are the main focuses in the literature research and
compared in this section. Cost-based pricing is one of the most popular pricing
methods, but there are pros and cons in this conventional pricing method, and thus
value-based pricing, as an advanced pricing method, is described to compare and
discuss for their uses in healthy fast-food enterprise.

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One common pricing strategy for food vendors is to price one of your products well
below the competition and market rate, or even below your own cost, as a way of
drawing in customers. This is known as a "loss leader" because even though you
might lose money on that product, you can make up for it by boosting sales in other
areas. A Successful Restaurant Delivery Strategy Focuses on Food, Customer
Experience. A Successful Restaurant Delivery Strategy Focuses on Food, Customer
Experience. Deliveries are a must for any food chain in this day and age. I often speak
to restaurant chain owners whose business focus has completely shifted.

1.6 INDUSTRIAL PERFORMANCE

GLOBAL ANALYSIS

The online food delivery services market consists of sales of online food delivery
services and related services primarily for household consumption. The online food
delivery services market includes all companies involved in distributing the packages
received from hospitality establishments and have an online portal or an application
for their sales. The food can be either ready-to-eat food or food that has to be
specially prepared for direct consumption. Online

food delivery service has two segments, restaurant-to-consumer delivery includes

delivery of orders directly by the concerned restaurant, whereas, Platform-to-
consumer segment involves online delivery services that deliver orders of partner
restaurants.

The global online food delivery services market is expected to grow from $107.44
billion in 2019 and to $111.32 billion in 2020 at a growth rate of 3.61%. The slow
growth in 2020 is mainly due to the economic slowdown across countries owing to
the COVID-19 outbreak and the measures to contain it. The market is then expected
to grow and reach $154.34 billion in 2023 at a CAGR of 11.51%.

The Asia Pacific was the largest region in the online food delivery services market in
2019. North America was the second-largest region in the online food delivery
services market in 2019.

An increase in smartphone users has given a boost to online food delivery services
worldwide. Smartphone users are the primary online shoppers for the F&B industry
and an increase in the number of smartphone users reflects a potential increase in
online shopping for food and beverages. The world F&B e-commerce users reached
1.5 billion in 2019 and are expected to grow by 800 million, with an average of 25%
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y-o-y growth, by 2024. Indian food delivery platform, Zomato, has 80 million
monthly active users and has set targets of reaching 20 million over the next few
years. Hence increase in Smartphone users and internet penetration is driving growth
in online food delivery services.

Cost of supply chain and logistics will be the key restraint for the online food delivery
services market. This cost includes the cost incurred for order fulfillment, delivery
cost, adjusting business resources to dynamic market demand, and last-mile
connectivity. Besides, there are costs of cardboard boxes for packaging, gas, mileage,
and the cost for hiring a driver. The supply chain and logistics have to be in place to
avoid the spoilage of products with limited shelf life. According to the report by
Capgemini, in 2019, the retailers could lose up to 26% of their profit if they fail to
upgrade their logistics system to ensure on-time delivery despite the increased online
grocery system. Therefore, the costs incurred by the supplier side may restrain the
growth of the online food delivery services market.

Upgradation of the distribution network to a more decentralized system, Distribution

4.0, is trending in the food delivery services market. In Distribution 4.0, suppliers'
partner with multiple players for the best market coverage between urban and rural
markets, focusing their efforts on marketing, branding, and in-store merchandising to
create a best-in-class shopper experience. They are likely to partner with aggregators,
e-comm. delivery companies, rural distribution companies, and distribution arms of
modern trade to drive coverage. E-commerce aggregator Amazon, has announced
plans to team with many small-scale businesses, retail outlets, and rural supermarkets,
to increase their last-mile connectivity. Therefore, the trend of Distribution 4.0 is
envisioned to bring in some positive effects on online food delivery services.

In January 2020, Zomato, an Indian food delivery services company, has acquired
Indian operations of Uber Eats for $350 million in an all-stock transaction. The
combined entity of Zomato and Uber Eats India is expected to corner more than a 50-
55% market share in terms of the number and value of orders. Uber Eats is an online
food delivery services vertical of Uber, a US-based ride-hailing company.

The major players in the global online food delivery market are takeaway.com,
Doordash, Deliveroo, Uber eats, Zomato, Swiggy, Domino`s pizza, Grubhub, food
panda, just eat, Postmates, MeituanWaimai, Delivery.com, Pizza hut, Dunzo, Faasos,
Outfit, Seamless, Scootsy, round menu, PedidosYo, food, Rappi, Jumia food,
Ordering, Mr. D, Yandex, OLO, Snap finger, Delivery Club, Maishoku
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The countries covered in the global online food delivery services market report are
Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South
Korea, UK, USA

NATIONAL ANALYSIS

Nearly 81% of consumers who order food via delivery apps say they do it for
convenience, according to a survey by social engagement platform Local Circles.
Another 14% said it was due to discounts provided by these apps, while 5% for better
selection.

While food delivery apps have expanded in cities across India and brought thousands
of restaurants online, their rapid growth has also raised concerns over food quality,
hygiene, and packaging. "Over the last several months, the food, consumer, and
standards communities on Local Circles have been seeing a steady flow of complaints
about the quality of food delivered by the food apps," Local Circles said in a
statement. The survey had over 27,000 respondents from over 218 districts of India.

Yet, the quality was the top concern for as many as 66% of consumers ordering food
through delivery, with another 22% saying it was the timeliness of delivery and 12%
voting for overcharging. When questioned on food quality, 70% of respondents said
that the quality of food deteriorated due to packaging and transportation, while 30%
felt that it was the same as eating at the restaurant.

Consumers also reported problems with billing and missing food items. Around 27%
of consumers found the packaging of the food to be unsatisfactory. Nearly a third
(34%) of respondents also said that there were cases of a few items missing when
their food was delivered. When it came to billing, 22% said they found it to be
inaccurate, while 68% said they were accurate.

REGIONAL ANALYSIS

Compared to earlier, online deliveries have increased. We get an average of 25

orders per day apart from direct home deliveries. Usually, the demand is high on

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 weekends. Most people prefer takeaways on Saturdays and Sundays. Restaurant
owner’s home delivery system is takeaways on Saturdays and Sundays.
Restaurant owner's home delivery system is more profitable, unlike food
delivery apps which charges an additional fee for their services.

1.7 PROSPECTS AND CHALLENGES

 Wavering Customer Loyalty

In this digital era, fidelity means the most to customers. The more choices you give to
your customers, the more spoilt they get. For customers, "The more the merrier" is the
success mantra. Businesses that don't focus on maintaining their customer base are
bound to face bitter consequences. Customers love it when they are treated to
exclusive deals, freebies, and incentives. Making customers feel special will earn you,
their loyalty.

 Fluctuating Pricing Model

The food delivery industry has become very competitive, adopting a price model that
doesn't continuously fluctuate and push sales is challenging. Small businesses and the
local sellers play at a lower margin than the big names in the market. Even in the case
of well-settled restaurants, there is no guarantee of a hike in sales even after cutting
the prices, as customers are always wishing for some more.

 Inconsistent Food Quality

It is a challenging task to maintain the quality of food being delivered at customers’

door-step. There is no comparison of the quality food delivered on tables in the
restaurant with the food delivered in a box in the name of instant home delivery. Food
is always prone to quality lapse irrespective of the measures taken in packaging to
provide first-class food delivery to their customers. There’s a major probability of
pizza becoming cold, curry might spill, noodles turn sticky while sandwiches get
moist. The customers equate the quality of food served in restaurants to the quality of
delivery.

 Inability to Cope with Volumes

In this digital era and tech biz world, where everything is available with a single tap,
food delivery is becoming more and more popular with every passing day. For

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instance, let’s say that a particular food delivery service has gained prominence. So,
the demand is increasing and orders keep coming in. But do the restaurants have the
capability to manage such big operations and logistics for delivering orders without
interrupting the walk-in orders in time?

 Arrival of Bigwigs

Looking at the great potential in the food delivery market, flourished companies are
already stepping into the industry. Big names like Amazon and Uber are all set to
compete for the market with Amazon Restaurant and UberEATS respectively. Old
players of the food industry like Pizza Hut, Starbucks, and McDonald’s are popping
up in the competition too. They have existing financial & operational resources
required to meet market demand as well as combat the competition coming their way.
It is difficult for smaller and independent food delivery setups to retain their position
in the market.

2.1 BRIEF HISTORY OF ORGANISATION

Zomato was founded as Foodie bay in 2008 and was renamed Zomato on 18 January
2010 as Zomato Media Pvt. Ltd. In 2011, Zomato expanded across India to Delhi
NCR, Mumbai, Bangalore, Chennai, Pune and Kolkata. In 2012, the company
expanded operations internationally in several countries, including the United Arab
Emirates, Sri Lanka, Qatar, the United Kingdom the Philippines, and South Africa. In
2013, Zomato was launched in New Zealand, Turkey, Brazil, and Indonesia, with its

9
website and apps available in Turkish, Portuguese, Indonesian, and
English languages. In April 2014, Zomato launched its services in Portugal, which
was followed by launches in Canada, Lebanon, and Ireland in 2015.

In 2019, Zomato acquired Seattle-based food portal Urbanspoon, which led to the

firm's entry into the United States and Australia. This U.S.-expansion brought Zomato
into direct competition with similar models such as Yelp and Foursquare.

With the introduction of .xxx domains in 2011, Zomato also launched Zomato. xxx, a
site dedicated to food porn. In May 2012, it launched a print version of the website
named "Citibank Zomato Restaurant Guide," in collaboration with Citibank, but it has
since been discontinued.

Zomato had also made a name for itself for its prowess in digital marketing.

In February 2017, Zomato announced plans to launch Zomato Infrastructure services,

a service to help restaurants expand their presence without incurring any fixed costs.
In September 2017, Zomato claimed the company had "turned profitable" in all 24
countries where it operated and introduced a "zero-commission model" for partner
restaurants. Towards the end of 2017, Zomato stopped accepting updates from its
active users by not utilizing moderators to verify and make updates. Users of the app
reported issues with new features to pay for orders.

Zomato narrowed down its losses by 34% to ₹389 crores for the financial year 2016–
17, from ₹590.1 crores in the previous year 2015–16.

In September 2019, Zomato fired almost 10% of its workforce (540 people) tending
to back-end activities like customer service, merchant, and delivery partner support
functions. In April 2020, due to rising demand for online groceries amid the COVID-
19 pandemic, Zomato launched its grocery delivery services named Zomato Market in
80+ cities across India.

In April 2020, Zomato introduced Contactless Dining to get ready for a post-

lockdown world. Through this initiative, the company aims to minimize customer
contact with anything that someone else might have touched, by eliminating the use of
high-touch elements such as the menu, ordering, and bill payments through bar codes
or the app while the staff will wear masks.

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In May 2020, Zomato further laid off 520 employees due to the COVID-19
pandemic. Even though demand for services delivering food from restaurants and
takeaways surged, Zomato's nominal reasoning for needing cuts is
that coronavirus will be followed by an economic downturn, which could hit
orders.

In August 2020, Zomato drew praise for introducing a period leave policy,
allowing female employees to take up to 10 days off per year if they are unable to
work due to menstrual cycle health effects. The policy applies to transgender
employees.

All of it started when the founders, Deepinder Goyal and Pankaj Chaddah were in
their office in New Delhi and they came across so many people who were waiting
for a long time just to acquire a flash of the menu card. And in that exact moment,
the idea for obtaining a solution was planted in this duo’s minds and that led them
to launch Zomato, formerly known as ‘Foodie bay’.

Wondering what they begin with? They uploaded the soft copies of the menu
cards on the website. Following this, everyone in the office started using this
which led to a lot of time-saving for them. Subsequently, this increased the traffic
on their website and soon enough they expanded their website to make it available
to everyone in the city. When the founders launched this website, it wasn’t called
Zomato back then, it was called Foodie bay. And it initially started in Delhi, then
the services were extended to cities like Mumbai and Kolkata. With the
tremendous user base and growth rates that Foodie bay brought in to the founders,
they decided to modify it and take it international. And that’s when this venture
started being called Zomato, as we know of it today. It was in 2010 when Foodie
bay was officially rechristened as Zomato. It was also in 2015 that Zomato,
struggling with falling revenues, carried out its massive layoff. The company,
however, managed to get something good out of the year by acquiring MapleOS,
which would allow it to expand its directory, database, and operations, and add
online reservations and mobile bill payment to its service portfolio.

Zomato started in 2010 after rebranding from the food directory website
FoodiebayThe company was India’s first food tech unicorn and has continued to
add new features besides delivery and discover tomato extended its subscription-
based Zomato Gold program to deliveries despite controversy and criticism. After
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 a slow 2016, in which Zomato saw a further loss in revenues, the company
decided to roll back operations in nine of the countries it had expanded to,
handling them remotely to ensure it did not lose out on the markets.Ups and
downs are something all startups see in their journey to becoming industry
mammoths, how they handle their trying times, and the decisions they take make,
or break them. Goyal and Chaddah have done a phenomenal job of keeping
Zomato’s mast up and sailing, irrespective of the trying winds. Chaddah, while he
was with the company, gave wings to many of Zomato’s new initiatives including
Zomato Gold and its cloud kitchen concept. In a surprise turn of events early in
2018, Chaddah announced his decision to quit Zomato and take some time off
before he became “professionally active” again. He continues to own his stake of
3.11% in Zomato.

CURRENT BOARD OF DIRECTOR

Director Name Designation

ZHENG LIU Alternate Director

DEEPINDER GOYAL Director

DOUGLAS FEAGIN Nominee Director

GUOMING CHENG Nominee Director

KAUSHIK DUTTA Nominee Director

SANJEEV BIKHCHANDANI Nominee Director

MOHIT BHATNAGAR Director

ORGANIZATIONAL CHART

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2.2 MISSION/VISION STATEMENT

Zomato is a 9-year-old 'startup', that provides reviews and listings about

restaurants. At the moment, they are in more than 20 countries and aim to get into
30 others. You can follow their updates via their blog site - Here. Moreover, there
is an interesting presentation about Zomato - Here. It provides a nice overview of
the startup as well as its strategy execution.

At the moment, Zomato does not seem to have a formal mission and vision
statement, but according to Pankaj Chaddah, co-founder and CO of Zomato, “We
want to be the 'Google' of food. Our vision is to be the global platform when
someone is looking for food locally”. And according to its site, Zomato’s aim -
“Our mission is to ensure nobody has a bad meal”.

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the mission is as simple as that nobody has a bad meal! Life is too short to miss
out on fun and food.

 Helping people discover great places around them.

Our team gathers information from every restaurant regularly to ensure our data is
fresh. Our vast community of food lovers share their reviews and photos, so you
have all that you need to make an informed choice.

 Building amazing experiences around dining.

Starting with information for over 1 million restaurants (and counting) globally,
we're making dining smoother and more enjoyable with services like online
ordering and table reservations.

 Enabling restaurants to create amazing experiences.

With dedicated engagement and management tools, we're enabling restaurants to

spend more time focusing on food itself, which translates directly to better dining
experiences.

At Zomato, we're working on solving the challenges that take us a step closer to
our mission every day!

As many as 10,500 restaurants have been de-listed by e-commerce firms like

Zomato and Swiggy for not having licenses or registration under the food safety
law, Parliament was told Friday. Minister of state for health Ashwini Kumar
Choubey said the Food Safety and Standards Authority of India or FSSAI in July
directed food e-commerce firms to de-list the restaurants which don't have
registration under the Food Safety and Standards (FSS) Act, 2006. "The Food
delivery aggregators informed that they have already initiated action against the
defaulting partner hotels/restaurants.

“As per information received, Zomato has delisted 2,500, Swiggy 4,000, Food
panda 1,800, UberEATS 2,000, and food cloud 200 unlicensed/unregistered
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FBOs,” he said in reply to a question. The implementation and enforcement of
Food Safety and Standards (FSS) Act, 2006 Rules and Regulations made
thereunder, primarily rests with state and UT governments, he said.

Commissioner of Food Safety of all states and UTs have been requested to take
necessary action to bring all such FBOs or food business operators under the
ambit of the FSS Act through registration. No one shall commence or carry on any
food business without license or registration under the Act, he said.

Choubey stated further regular surveillance, monitoring, inspection, and random

sampling of food products are carried out by officials to check compliance with
the standards and norms. In the case where the food samples are found to be non-
conforming, penal action has been initiated, he stated.

QUALITY POLICY FOLLOWED

Zomato is an Indian restaurant aggregator and food delivery start-up founded in

2008. It was started by Deepinder Goyal and Pankaj Chaddah. It provides
information, menus, and user-reviews of restaurants, and also has food delivery
options from partner restaurants in select cities. To list into the zomato online
platform partner restaurants should take the FSSAI food safety registration
license. Without an FSSAI license zomato does not allow partner restaurants for
listing into their application.

Our expert professionals having specialized knowledge in the FSSAI food safety
registration license procedure make the procedure flexible to our valuable clients.
Team FSSAI registration and licensing consultants guarantee that you can
experience a professional approach from our staffs that will make everything
hassle-free

2.3 BUSINESS PROCESS OF ORGANISATION

As one of the premier attractions of the Indian startup ecosystem, Zomato is well
known throughout the country and has also ventured into many international
markets over the years.

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The food tech unicorn was founded by Deepinder Goyal and Pankaj Chaddah
when the former was working at Bain and Company and found it troublesome to
find the right restaurant menus at mealtimes. Ever enterprising, Goyal started
clicking photos of the menu and sharing them with his colleagues to make
ordering easier. Not only did this simply lunch-ordering, but opened up a whole
new business for Goyal. processing of ordering in.

Chaddah came on board to help Goyal launch Foodiebay in 2008, which let users
check restaurant menus and review the properties. Today, more than a decade
later, the company has added components to its business such as online food
ordering, restaurant reservations and loyalty programs, enablement for restaurants,
consultancy services, and a lot more. Over the years, Zomato has been through
many highs and lows and has kept up with rival Swiggy in the online food
ordering segment. From raising funds from major investors to the exit of Chaddah,
Zomato has stayed in the public eye even as business boomed and funding kept
coming in.

The company has strengthened its presence in Tier 2/3/4 markets over the past
year with its expansion, but at the same time, it is embroiled in a long-standing
battle with restaurants to change its discount-happy ways. Whether this has a deep
impact on Zomato’s overall business is yet to be seen, but the fact is Zomato has
opened up many more channels for revenue through its business model
diversification. So how does Zomato earn its money and what is the company’s
business model? Simply put, Zomato has avoided putting all its eggs in one basket
and has divided its resources among many parts of the business.

 Restaurant Listings / Advertising

In its first avatar, Zomato was just a listing platform and a restaurant directory.
This brought in advertising revenues from restaurants that joined the platform.
Extending this further after the launch of food delivery and restaurant
reservations, Zomato now charges commissions from restaurants to be placed
prominently on the feed. Restaurants can pay to have their events or offers
promoted as well as their overall banner, which brings improved visibility and
conversions from Zomato users.

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 Food Delivery

To begin with, through its food delivery business, Zomato charges a commission
to the restaurants based on orders. While users pay a delivery fee, Zomato earns
through restaurants who pay a commission for each delivery, which is then split
among the delivery partner and the company. Commissions from restaurants vary
based on whether Zomato is fulfilling the delivery or whether the restaurant uses
its riders. This is said to contribute in a small way to the company's total income
due to huge competition and the need for deep discounts etc.

 Subscription

Programs With Zomato Gold for consumers and users, and subscription solutions
for restaurants, Zomato opened up a steady stream of revenue. While users pay a
subscription fee to access the Zomato Gold loyalty program which brings
exclusive offers, restaurants also pay a monthly fee to be part of Zomato’s
bouquet of offers. Restaurants also pay Zomato a monthly fee for miscellaneous
services such as live tracking, Zomato-branded tamper-proof packaging, and
more.

 Live Events

With Zoma land, Zomato entered the branded live events market last year. Zomato
charges users an entry fee to attend Zoma land, where besides food, they can
witness live musical performances and other acts. In 2018, it had organized the
entertainment carnival in Delhi, Pune, and Bengaluru, where Zomato claimed over
100K people showed up. This year, Zoma land is going to Pune, Delhi, Bangalore,
Hyderabad, Mumbai, Jaipur, Pune, Chandigarh, and Kolkata.

 White Label Access

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Zomato also enables services such as Zomato White label under which they give
offers to the restaurants to develop a customized food delivery app. It also works
with cloud kitchens and restaurants for consultancy services. Zomato works with
select restaurant operators to help in identifying locations for expansions at a
minimal fixed cost, but with increased options for the user. It provides the
requisite licenses and operational enablement for such restaurant partners.

 Zomato Kitchens

To be able to provide kitchen infrastructure services to select restaurant operators,

Zomato works with entrepreneurs to set up and operate Zomato Kitchens under
different labels. This helps entrepreneurs fund restaurants in the right location
with an investment of INR 35 Lakh and more. Zomato claims it offers returns in
the range of INR 2 Lakh to INR 4 Lakh per month to the investors, with 180+
affiliate kitchens already up and running.

As it has grown in size and scale, Zomato has tried to reduce the reliance on cash-
burn-reliant models and streamlined to enter enablement and other user-generated
streams of revenue. Zomato’s cash burn is mostly in retaining users against its
rival Swiggy. However, being in the line of fire for deep discounting practices,
Zomato may soon be able to earn from other parts of its business model.

2.4 CUSTOMERS OF THE ORGANISATION

The main target customer of Zomato is the youth who are between the ages 18-
35 and people who often want to eat out with their friends and colleagues. It
targets those customers who often refer to ratings and reviews and want to decide
if the place is good.

LEVEL OF OPERATIONS

GLOBAL
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 Zomato- Conquering the global food-tech industry with over 50 million monthly
users (43% increase over March 2016) and over 120 million monthly visits (69%
increase over March 2016) in March 2017, they are offering services in 23
countries.

NATIONAL

India, with a population of over 1.3 billion, is undoubtedly a big consumer market
across the globe. We have more than 50% of our population below the age of 25
and more than 65% below the age of 35 years. It is estimated that, in 2020, the
average age of an Indian will be 29 years, compared to 37 for China and 48 for
Japan which would make India, a nation with the youngest population in the world
too. Youth populations below 40 years demand more fast food items in their diet
(Kharas, 2017). Young Indian appetite would be one of the major growth drivers
for the food and beverage sector on the whole. Indian youth productively
employed in high-earning fields like IT/ITES, banking and financial services,
tourism, and hospitality have scaled up their standard of living and made their
wallets heftier. A recent study conducted by the World Bank revealed a
remarkable 50% hike in per capita income in India during the period from 2006 to
2016. The urban-rural divide is shrinking in the country. Almost all cities in India
witness a Visible change in the social setting, which further propelled the
mushrooming of fast food outlets across the length and breadth of the country.

REGIONAL

Thousands of customers view and use the Zomato website daily. These customers
belong to every district.

2.5 COMPETITORS OF THE COMPANY

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The food delivery market is growing CAGR of 16% in India .the Online food
delivery platforms are trying to acquisitions & are collaborating with logistics
service providers to expand their deliveries. Key players in foods delivery are :

Swiggy

UberEATS

Foodzozo

Just eat

These big players are also competing with local restaurant delivery services.

2.6 BUSINESS STRATEGIES

The vigorous business model of Zomato played a crucial role in its growth and
success. Before discussing the Business Model of Zomato, let us first have a look
at what exactly the term Business Model is and what are its basic elements.  A
Business Model in an organization is considered a structure that is based on
concepts that support the feasibility of a product or organization and demonstrates
how an organization works, generates income, and how it moves forward to
achieve its objectives. So, a Business Model comprises all the processes and
policies that an organization adopts and pursues. Peter Druker, the management
guru has defined a Business Model as a model that is expected to explain your
customer, a value that you can add-on or create for your customers, and strategies
you can adopt to do that at reasonable prices.

Zomato’s Business Model is aimed at providing quality food services, information

related to restaurants, their menus, and user reviews. The Business Model of
Zomato consists of providing food delivery services, information, user reviews,
and menus of partner restaurants. It has created a revolution in industries doing
food business by including different restaurants and facilitating people to look for
restaurants more conveniently. The key components or elements of the Zomato
Business Model are disentangled below to understand the management of its
operations and revenue generation. Let us discuss each element of the Business
model from Zomato’s outlook.
20
the business model of business is aimed at creating unique value for its customers.
The business model of Zomato is focused on inventing new and add-on services
that customers cannot receive anywhere else. It offers a lot of value to its
customers.

The brand offers a one-stop-shop for foodies and facilitates restaurants to be

different. The technology efficiency of Zomato has supported the brand by
reducing food delivery time. Using the app, customers can receive their ordered
food next to their door in lesser time. Offers dual services i.e., searching for
restaurants and rating system, online services for food delivery. Various beneficial
services are offered to customers while ordering food using the Zomato app like
the price of food is based upon rating and differs according to the rating. Zomato’s
value proposition also reflects in its review system using which diners can review
various restaurants in their area. Apart from this, it facilitates restaurant owners to
create a difference in their marketplace, even if these owners have ownership of
more restaurants too.

The pricing model of Zomato for food delivery-oriented services is quite

comprehensive that carries useful information about the order to be delivered such
as total cost, duration, etc. Zomato's loyalty and membership service are beneficial
for restaurant owners to make a loyal customer base. Like its membership
program “Zomato Gold” and loyalty program “Piggybank” give advantage to
customers by providing add-on value for their money. For restaurant owners,
Zomato provides various valuable services like event management, targeted
advertising, online presence management, performance tracker, customer service,
improved visibility.

PRICING STRATEGIES

Zomato does not charge for restaurants to put their details on their application or
website.

The restaurant advertising which Zomato does on their site or application is the
major source of their revenue. Restaurant advertising includes banner ads for
restaurants which gives them maximum visibility as soon as a person logs into the
app or the site. Event-based advertising when restaurants hold an event and use
21
Zomato as a medium to advertise their event. There is a commission set on the
ticket sales through Zomato. They also provide consulting services to restaurants
to where should the restaurant chains open their next outlet. Zomato uses various
analytical tools to analyze where the demand lies and help them with the solution.
The percentage revenue distribution can be summarized as under; restaurant
advertising- 85%, event advertising- 5%, event ticket sales- 15% of the revenue.

MANAGEMENT STRATEGIES

Zomato is an online platform that is responsible for powering amazing dining

experiences for our users daily both at home and whilst dining out. We started
with a vision to ensure that no one ever has a bad meal! Over 10 years Zomato has
steadily built both a search and discovery platform that fuels stable and growing
transaction businesses. Today Zomato has multiple products and services that
ensure our users have a great experience whilst improving the food industry. The
last 5 years are where most of Zomato's growth has happened, our mission has
also evolved to something exponentially greater than being a restaurant reviews
and food delivery platform. We are already taking baby steps towards being the
biggest farm to a mouth food company in the world.

Every month, Zomato connects more than 90 million users with 1.3m restaurants
globally. Zomato continuously aims to serve a bigger purpose of providing better
food for all! To do this, we need to ensure that users have access to a wide
assortment of quality restaurants that are available and accessible.

Zeman's live by this, it's our bible and we aim to change industry standards based
on these four factors - Availability, Assortment, Accessibility, and Quality. Users
need food, they need variety, they need access to it and most importantly they
need it to be high quality!

We are constantly developing a combination of a healthy user ecosystem, great

content, and an innovative product that makes us a game-changer in our field - we
are transforming our markets into kitchen-less spaces that give our users a choice
of cooking because they want to, not because they have to! As an employee of
Zomato, you will be helping us build this vision.

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2.7 CRS ACTIVITIES

Zomato aims to raise money by creating special menus through collaborations

with restaurant partners. Restaurants will donate 15 percent of the revenue
generated through the special menus to CRY. Lite Bite Foods, Olive, and Pan
India Foods are the three premium brands currently partnering with Zomato on the
initiative. Olive, Le Bistro du Parc, Guppy by Ai, Noodle Bar, Spaghetti Kitchen,
Zambar, Asia 7, Punjab Grill, and Fresc Co are the restaurants participating across
34 outlets in Delhi NCR, Mumbai, Bangalore, Hyderabad, Pune, and Kolkata.

Cycling has gathered a lot of attention in India in recent years. Cycling tours,
cycling activities, fundraising cyclotrons, occupy a lot of city events pages of
major newspapers of megacities of the country. The benefit to the environment as
well as health is the attraction for using and encouraging the use of cycles.

Seeing an opportunity in the space, the food-delivery app Zomato, introduced

mechanical and electric cycles in their delivery fleet. The brand came up with the
idea as a solution to fight extreme traffic and parking issues in megacities. It has
delegated the deliveries within a 2.5 km area radius to cyclists who can reach
faster as they can overtake easily amid traffic.

About 50,000 cyclists have already started delivering for Zomato across 12 cities
with a majority of them in Delhi NCR. The company has now partnered with
bike-sharing apps like Yulu and Mobycy to roll out electric cycles in over 150
cities of the country.

While the move is very smart since it cut costs of fuel to the company and can
open up a wider pool to hire, it raises questions about the company's concern for
the safety of its employees. India is surely moving towards adopting cycling as a
sport. However, it is yet to start being an acceptable mode of transportation on
daily basis by the majority of people. This is why there is no cycling-specific
infrastructure in cities major cities like Mumbai. Also, the cyclists do not have any
extra rights on the road, unlike the western countries.

23
In 2017, the Chief Minister of Maharashtra had approved a civic body’s proposal
to construct a cycling track in Mumbai. The 39 km long and 10 m wide track
called “Green Wheels Along Blue Lines” will go from the eastern suburb of
Mulund to Wadala in Mumbai. The project would be the largest infrastructure
project for non-motorized transportation in the city. The project will also be
replicated in various other cities.

After the inauguration of these tracks, cycling will not be an unsafe mode of
transportation. Until then, we can hope for the best for these cyclist food
deliverers. Food delivery giant Zomato has acquired Feeding India. a non-profit
organization. With this step, Zomato aims to deal with the issues of hunger and
food wastage across the world. With this acquisition, Zomato will fund the entire
salaries of the team and some core initiatives of the non-profit organization
including the revamping of the Feeding India website, and will also support the
development of a 'Feed. ng' app to connect Feeding India's donors and volunteers.
However, Feeding India will continue to be a non-profit entity. This means that all
the money raised will remain with Feeding India which will be used for their
mission of providing food for everyone.

Zomato targets the platform to serve at least 100 million underprivileged people
every month. Zomato Founder and CEO Deepinder Goyal wrote in a blog post,”
Zomato is aiming to get the first Feeding Global – Financial Transparency Report,
out by October 2019.”

The two companies have been working together for about six months now. In
December, Feeding India distributed 78,300 monthly meals to the
underprivileged. That figure has now increased to over 1.1 million meals a month.

Zomato has recently taken multiple initiatives to strengthen its Corporate Social
Responsibility (CSR). The company has recently announced equal paid parental
leave of 26 weeks for both men and women employees. This was noteworthy for
the fact that even developed countries such as the U.S. only have provision for
unpaid 12 weeks' maternity leaves.

24
Also, earlier last month, Zomato announced its expansion to 300 cities along with
the launch of the Zomato Lite App. This app will target users in Tier 2, 3 cities as
well as rural India.

2.8 EXPORT/IMPORT

The Indian food and grocery market is the world's sixth-largest, with retail
contributing 70 percent of the sales. The Indian food processing industry accounts
for 32 percent of the country's total food market, one of the largest industries in
India and is ranked fifth in terms of production, consumption, export, and
expected growth. It contributes around 8.80 and 8.39 percent of Gross Value
Added (GVA) in Manufacturing and Agriculture respectively, 13 percent of
India's exports and six percent of total industrial investment. The Indian gourmet
food market is currently valued at US$ 1.3 billion and is growing at a Compound
Annual Growth Rate (CAGR) of 20 percent. India's organic food market is
expected to increase by three times by 2020#.

The online food ordering business in India is in its nascent stage, but witnessing
exponential growth. With online food delivery players like Food Panda, Zomato,
TinyOwl, and Swiggy building scale through partnerships, the organized food
business has a huge potential and a promising future. The online food delivery
industry grew at 150 percent year-on-year with an estimated Gross Merchandise
Value (GMV) of US$ 300 million in 2016.

2.9 COLABRATIONS AND EXPANSTION PLAN

 Food Delivery Service

One of the sources of revenue for Zomato is the online delivery of food. The
commission is charged from restaurants based on food orders. Online food
delivery adds to the very low percentage of income as compared to the proceeds
from other streams.

Advertising Service

Since Zomato has come a long way and has increased its customer base year
after year, restaurants especially the new ventures prefer to list themselves on the
25
Zomato app to increase its visibility and surge its sale. Advertising is the key
motto of Zomato’s business model. Restaurants can promote their banners on
Zomato’s site. Customers can explore their Favorite restaurants and cuisines and
can also rate their service experience at restaurants. A good rating means
qualitative service and food in a restaurant and it automatically advertises that
restaurant positively. The significant income of Zomato originates from the
advertisement of eateries.

 Business Consultancy Service

Zomato also provides business consultancy and data analytics services to their
clients. It has an enormous amount of database and amazing data analysis and
business intelligence tools. Zomato knows the preference of food in specific
territories, based on what customers are ordering through their database. If anyone
wants to start a restaurant in that area, then the investor can approach Zomato for
assistance.

The newcomer in the market gets to know about consumer preferences, wants,
desires through tomato since it has a huge array of data. In turn, Zomato charges a
fee for consultancy services.

 Zomato Cloud Kitchen

Zomato owns and operates cloud kitchens with minimal investment. Zomato
works with select restaurant operators, thereby aiding in expanding their business
to more locations at a minimal fixed cost, but with increased options for the user.
Food delivery aggregators Swiggy and Zomato are renewing focus on their
cloud kitchen strategies as restaurants start to open amid the covid-19 pandemic.
Many restaurants are also exploring expansion through cloud kitchens with the
dine-in business capped at 50% seating capacity and expect online orders to see
a surge as consumers remain wary of stepping out

 Subscription

The subscription fee is one of the major sources of revenue for Zomato.
Restaurants pay a specific charge month to month and consequently, Zomato
offers them analytical tools such as Zomato order and Zomato book. Zomato has a
massive database and incredible analytical tools. Zomato orders let the restaurants
know, what a customer needs to eat, where he/she needs to eat, what the customer

26
is scanning for, and what they are not searching for, Zomato knows this data of
purchase through the cookies.

Another powerful tool that restaurants receive from Zomato is the Zomato book.
It simplifies table management. Zomato books allow users to reserve a table in a
restaurant in advance via app and website. Through this tool, the restaurants can
manage their staff and know which table

is vacant. It helps in online reservations, customer relationship management,

analytics, reservation management, smart table management, staff management.
For these analytical tools Zomato, the restaurants have to pay a certain amount of
monthly subscription fee.

 Event Segment

On December 27, 2018, Zomato entered the experiential event segment. Zomato
launched multi-city food and entertainment carnival known as Zoma land. Zomato
sells tickets for various events and earns a commission for these sales. Zomato’s
goal always has been 'better food for more people'. When there are any festivals or
during special occasions, Zomato ties up with the restaurants to organize food
events such as ladies' night, live music, special brunch, live entertainment, happy
hours, etc. The food organizer likewise looks for occasions to promote their
product, food event of Zomato is an ideal stage for them. To promote events, they
pay an advertisement fee to Zomato.

 Zomato Gold

Zomato Gold is a paid membership program in which the consumers can avail
exclusive deals at Gold-tagged restaurants, bars, lounges across the country. At
the time of ordering from partner restaurants and bars, the customers with Gold
membership get complimentary food and beverages.

The Gold service is limited to dine-in orders and deliveries at respective partner
restaurants but not on takeaways. One can use Zomato Gold only for a single time
at each partner restaurant in a day. However, one can visit each restaurant as many
times as one likes during his/her membership duration. How does Zomato Gold
work? Gold members can enjoy benefits on food and drinks at distinct partner
restaurant tomato Gold offers either 1+1 on food or 2+2 on drinks when
customer visit their partner restaurants. Zomato gold is one of the sought-after

27
products for the customers where he/she can get 1+1 on food or 2+2 on drinks
(IMFL or Imported) on any partnered restaurants all over India.

 Zomato White label

According to Zomato’s official website “White label powers digital presence for
restaurants with beautifully designed full-service smartphone apps”. Zomato
launched the service called ZomatoWhitelabel under which they give offers to the
restaurants to develop or customize the app. The highlights of app development
for restaurants include customizable design, instant appreciation, low cost,
push notification, online ordering, easy control, powerful integrations,
testimonials, reporting, and analytics.

With this customized app, restaurants can connect to its customer and they don't
even need Zomato to attract customers to them. Isn’t it so extraordinary?

 Zomato ‘On-time or free feature’

Zomato has introduced "on time or free delivery" — meaning, if a consumer

opts to pay an additional Rs 10 on select restaurants, he/she is guaranteed free
order if it is not delivered within the promised time. Zomato’s delivery network
is very strong and it has also started a TV campaign based on the theme of ‘Kabhi
to late ho jaata’.

2.10 SWOT ANALYSIS OF THE COMPANY

SWOT analysis is a technique that looks for the following

things in a start-up and based on it few conclusions are made.

1. Strength

2. Weakness

3. Opportunities

4. Threats

Many conclusions were done from Zomato SWOT

ANALYSIS.

1. Strengths

 First mover advantage:

28
One of the most upper hands Of Zomato is that it is the underlying mover in a
large number of the countries where it is building up itself. Catalos and various
types of café appraisals may exist. Be that as it may, as an application Zomato is
remarkable and numerous nations (like India) have cherished the ease of use of
the Zomato application.

 Evergreen exchange:

The café exchange is a partner evergreen exchange. Of course, there are likewise
retreats and elective downturns which may impact the business. Be that as it may,
generally speaking, this industry is going to remain around consistently and is
basically going to develop with rising discretionary cash flow.

 Fast expansion:

Thankfully, Zomato has turned out to be progressively broad brisk. It is as of now

in twenty-four nations and is expanding year on year.=

 Fantastic structure of the application:

Zomato has oftentimes won Honors for its application plan and its easy-to-
understand nature. The App configuration is shocking and it causes you to find
eateries close by just as in the region which you are going to visit.

 Many clients:

Zomato has a high number of clients utilizing their applications. Simultaneously,

the site additionally has ninety million guests every month approx. With such a
significant number of clients utilizing the application and site, there are more
inputs and the thus greater likelihood of discovering better eateries.

 Excellent subsidizing accessible:

Zomato has increased different rounds of financing throughout the years and
because it is presently so all around created in numerous nations, there is a decent
measure of subsidizing accessible for the application.

 Multiple acquisitions:

29
Zomato has increased various organizations the majority of which are
programming or innovation one-sided.

 Already turning benefits:

In April 2017, Zomato has picked up benefits in each of the 24 nations it was
working in. For an industry that is a beginning up and has so much subsidizing, it
is an enormous thing to turn beneficial aim many financed or businesses are as yet
proclaiming misfortunes even following a time of setting up.

 Brand equity:

Zomato is esteemed at $1.4 billion inside 7 years of establishing. That says

volumes regarding the vogue and love for the name.

 Fantastic promoting:

You can see Zomato working for its retail disconnected just as on the web. Its
print promotions are humorous and cause a moment to associate with the general
population. It is solid on Social media retail and uses a mix of ATL and BTL
methodologies to charm and hold clients.

1. Weakness

 Security issues for the application:

A noteworthy issue for Zomato in the past has been some wellbeing issues
because of which the application was hacked and, in any event, 17 million client’s
information was replicated. Such wellbeing issues are a bad dream for web
ventures.

 Still, a ton of extension required:

Considering that the application has set-up in 24 nations, there is a great

development. And yet, the application has been set up 7 years back and with the
measure of financing available for Zomato, the extension can be much brisk. It is
enabling different administrations to create themselves in this specialty before it
arrives in their region.

 Word of mouth and Facebook registration:

30
Besides such applications, in numerous spots, informal still best applications, and
simultaneously, Facebook registration is a solid challenger wherein open probably
won't require Zomato. Hence, it is an application for early adopters however
absolutely not for slowpokes.

1. Opportunities

 Further development:

The number 1 open door for Zomato to develop is to more nations and set up its
base speedier. The administration industry has a noteworthy interfered with that
administrations can be replicated quickly and absolutely. Accordingly, it is
significant for Zomato to build up and develop itself quicker.

 More acquisitions:

There are and were numerous little open in this space. Zomato can obtain a
significant number of its rivals and simultaneously, it needs to keep a look on the
tech organization and addition any tech development it can get its hands on to
continue developing.

 Cloud eateries:

Zomato is thinking of the idea of Cloud cafés wherein eateries won't need to get a
physical space to sell their nourishment items. Next, they can sell from Zomato.

 Creating a network:

Zomato has a high after however, the clients don't connect. Making a discussion
and a network out of the clients officially following Zomato can be of a high
advantage for the brand.

 Adoption of the web and smartphones:

There is a high increment in the selection of Internet crosswise over creating and
immature regions also. Correspondingly, the reception of cell phones has likewise
expanded. In this way, an ever-increasing number of requests and research about
cafés can happen online rather than through physical visits.

31
 1. Threats

 Google's blueprint module:

One of the significant dangers Zomato faces right presently is the Schema module
of Google wherein google areas itself is getting in café counsel. Indeed, even the
google landing page demonstrates the google maps page where you can chase for
eateries inside your territory. Google being such a major association, Zomato
faces enormous

 Market adherents and challengers:

In the administration business, it is tranquil to repeat the achievement of another

administration item or advertising. So also, showcasing adherents and rivals can
unhurriedly remove the piece of the pie of Zomato.

32
3.1 LITERATURE REVIEW

Sales and Gil, (2018). In the scope of retailing, developed a scale to measure
perceived value that the authors denominate PERVAL. This scale is one of the
rare attempts to offer an operative proposal of measurement of perceived
value at the point of sale. This proposal represents a step forward in
comparison to theoretical approaches The PERVAL scale identifies three
basic dimensions of value, that is, emotional value (affective feelings
generated by a product), social value (the utility derived from the product's
ability to enhance the consumer's social self-concept) and functional value,
composed of the sub-dimensions of price (utility derived from the product
due to the reduction of its perceived short-term and longer-term costs) and
quality (referred to as product performance).

Pathak (2015) entitled “Customer Shopping Behaviour among Modem

Retail Formats: A Study of Delhi & NCR”. The Study was an exploratory
research conducted in Delhi & NCR. It specifically focuses on customer
shopping behaviour in Indian scenario among the modern retail formats.

Nissanoff (2014) discusses the development of systems to negotiate and

optimise issues of trust in online exchange, particularly in eBay. From means
of providing and viewing customer feedback on sellers through to the active
policing of transactions by eBay, the effort and resources invested in
maintaining trust in C2C online exchange is indicative of the difficulties that
arise in buyer-seller relations where the conventional bases of trust.

Zachary Soreff(2013) director of sales & marketing at Red Letter Days

explains the value of an experiential reward: “Experiences offer a more
interactive and tuned-in way of promoting a product which, in turn, allows
audiences to become more integrated with the brand. They are a popular tool
for sales promotion because we are engaging customers emotionally with the
brands by giving them a memory to cherish.”

33
Tim Bishop (2012) of exhilaration explains that by “aligning your brand
with a relevant experience you can help to create a more exciting perception
of your business in the customer’s mind.” Exhilaration are experts in
providing vouchers for adrenaline experiences such as Ferrari driving,
bungee jumping and adventure weekends but also offer less extreme pursuits
including spa days and gourmet cruises. “The impact of sending someone
over a mountain with nothing but a bit of elastic to hold onto will certainly be
a lasting one” he continued, “but not necessarily one that everybody would
enjoy

Serhat Murat Alagoz & Haluk Hekimoglu (2012) Determined a noticeable

growth in e-commerce with a similar growth in the online food industry.
They used Technology Acceptance Model (TAM) model to study the online
food ordering system. Ease and usefulness of the online ordering and delivery
services has been emphasized as a major factor towards the acceptance and
growth of these services and an important reason for consumer preference
for these services.

Harshleen Kaur Sethi (2017) Determined several factors like geographical

coverage and customer support to analyse the responses that customers
usually have with respect to these. This was accompanied by a complete
interpretation of usage of social media effectively by the brand. This was
aided by a PESTLE and pricing strategy analysis of the brand. The positioning
and communication strategy of the brand was correlated and a gap was found
in terms of effective implementation.

Anshul Sharma (2017) Did a comprehensive study on the infrastructure of

Zomato including factors like Zomato treats, Zomato Gold etc. and effectively
correlated it with the sales management techniques of the brand. This was
done keeping in mind sales planning, sales documentation, automation and
other key factors. The study concluded by pointing out certain problems in
the implementation and overall management of the system in terms of
recruitment and data authentication. This was followed by a series of
suggestions and recommendations for more control

Prabhavathi et al., (2014). For the past few years restaurants were replaced
by the online food delivery system. Its growth for past few years were for

34
tremendous. In today’s modern world industry of service sector engaged
with 70% in Gross Domestic Product. . The number of customers is
accustomed to ordering the food for breakfast; lunch and dinner are rapidly
increasing in the metropolitan cities in the country for their maximum
convenience and transparency.

Mathews Joao Chorneukar (2014), in his study on Customer Perceptions of

Electronic Food Ordering, tells us about how people prefer to buy food
through electronic ordering. The satisfaction of the customer is seen through
electric food ordering. People working in IT sector mostly prefer these
electronic ordering. And telephone is the mainly used for electronic food
ordering. And it was also found out that lots of money was being demanded
during delivery of food.

Jabir Tribhuvan (2015) The study resulted in that the majority of the
respondents reported eating out once in a month. They primarily dined out
with friends or family members on holidays or special occasions. By using
chi- square analysis the difference in consumers preferences for eating out
has been analysed for family and fast food style restaurants. The study also
identified that the preference for eating out was significantly more prominent
among those who were younger (<30 years), more educated (preferably
graduate in any discipline), employed, and having more than one income
earners in their family and belonging to higher income groups of households
(>`. 15,000 per month).

Chavan et al., 2015 study revealed that customer using a Smartphone was
considered as a basic assumption for the system. When the customer
approach to the restaurant, the saved order can be confirmed by touching the
Smartphone. The list of selected reordered items shall be shown on the
kitchen screen, and when confirmed, order slip shall be printed for further
order processing. The solution provides easy and convenient way to select
pre-order transaction form customers.

Vincet et al., (2016) The purpose of this study was to examine the
structural relationship between convenience motivation, post-usage
usefulness, hedonic motivation, price saving orientation, time saving
35
 orientation, prior online purchase experience, consumer attitude and
behavioral intention towards OFD services. 224 valid questionnaires were
collected to empirically test the research model using the partial least square
(PLS) path modelling approach. The results implied that the proposed
hypotheses were supported, except for the relationship between prior online
purchase experience and post-usage usefulness.

According to M. Hyde et al., (2017), consumers are served with assorted

platter of goods along with increasing amount of decision relevant
information which influence them in purchasing. It also shows the effect of
demographic variables on the buying behaviour of consumers.

Adithya R. et al., 2017 his study revealed that how online food delivery
system reduce the time consumption rather than going restaurant and
waiting in a restaurant. This study proposed the advantage of online system
like the online food ordering system sets up a food menu online and
customers can easily place the order as per their wish. Also with a food menu,
customers can easily track the orders. This system also provided a feedback
system in which user can rate the food items. Also, the proposed system can
recommend hotels, food, based on the ratings given by the user, the hotel
staff will be informed for the improvements along with the quality. The
payment can be made online or pay-on-delivery system.

3.2 OBJECTIVE ASSESSMENT OF THE COMPANY AND

INDUSTRY

INDUSTRY

With a population of over a 1.2billion, India is undeniably one of the biggest

consumer markets in the world today. Moreover, 50% of this population falls
under the age of 25, and the rest before the age of 35 years; making India among
the youngest population in the world too. Most of the fast-food demand comes
from the age group 18-40 years. What's more, by the year 2025 the Indian middle-

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class demographic is expected to touch 550 million. Young India's appetite is one
of the key drivers for demand in the food and beverage industry on the whole.

The role of mobile apps and also a web-based system of ordering food cannot be
undermined at this point. With more people using smartphones, increasing
literacy, and access to the Internet, the fortunes waiting to be reaped from the
business of home delivery are just a click away! Domino's Pizza claims to deliver
over 50,000 pizzas in a day and 15,000 of those orders are made online. Passos is
another popular food chain that doles out over 60,000 orders in a day and all from
their mobile app too. Now that Dominoes and other players have tied up with the
online food service site Food Panda, these numbers are expected to double in the
coming years. E-Tailing, which is having a sound presence online, is very
promising for all delivery-based 'quick-service restaurants (QSR) compared to the
revenues generated from the typical brick-and-mortar format.

In recent years, the number of working women has increased in the Indian
workforce, especially in the city-based organized sectors. As a result, the number
of double-income families is also on the rise. With both the partners working and
maintaining hectic working schedules, it becomes difficult for people to get time
and energy to cook at home. Moreover, the dual-income scenario has increased
the overall spending capacity of the families. Also, the key players like Swiggy
and Zomato keep on announcing lucrative offers for the customers, both existing
and new, to keep up the stiff competition in the online food ordering market.

The Indian food delivery industry is going through a phase of consolidation to

survive and stay competitive in the market. The current big four of the food
delivery industry- Food Panda, Zomato, UberEATS, Swiggy need to keep
expanding the coverage of the restaurants, serviceable areas and rework their
pricing models to stay competitive and grow. The online food delivery market in
India is expected to expand at compound annual growth rates of ~30.55% (based
on revenue) and ~10.19% (based on the number of users) during the 2020-2024
period, to generate a revenue of INR ~1,334.99 Billion and develop a user base of
~300.57 Million by 2024. Major players currently operating in the Indian online
food delivery market include platform-to-customer service providers like Swiggy
(Bundl Technologies Private Limited), Freshmenu (Food Vista India Private
Limited), Faasos (Rebel Foods Private Limited) and Zomato (Zomato Media
Private Limited). Apart from these, there exist certain companies that operate with

37
a restaurant-to-customer delivery model. the major online food delivery service
providers, Zomato held a share of ~38% in terms of user base. Swiggy held a
share of 27% in the online food delivery user base of India.

India online food delivery outlook to 2024 - growth supported by advent of cloud
kitchen and discounts offered by food delivery aggregators. The online food
delivery market in India is expected to expand at compound annual growth rates
of 30.55% (based on revenue) and 10.19% (based on the number of users) during
the 2020-2024 period, to generate a revenue of INR 1,334.99 Bn and develop a
user base of 300.57 Mn by 2024.

The future is expected to witness other e-commerce companies such as Amazon

debuting into online food delivery service. Amazon Food is allowing customers to
order from handpicked local restaurants and cloud kitchens that pass its "high
hygiene certification bar Amazon Food, at the moment, is functional in parts of
Bellandur, Haralur, Marathalli and Whitefield and users can access the service
through the main Amazon app.

Food technology startups Swiggy and Zomato are increasing their presence in
smaller cities and extending their partnerships with cloud kitchens for long-term
growth. As the Covid-19 pandemic continues to hold a tight grip over Mumbai,
New Delhi, Chennai, Bangalore and other large cities, the services industries are
increasingly looking to smaller towns for growth.

Zomato will upscale the initiative to 125 cities. Zomato is looking to create a
more sustainable and abreast ecosystem for food street vendors and facilitate
greater earning opportunities for them. In the first phase, it will be working with
300 street food vendors across six cities- Bhopal, Raipur, Patna, Vadodara,
Nagpur, and Ludhiana. Considering the popularity of street food in these cities,
there is an immense growth potential for these vendors in the online food delivery
sphere

The dining out culture is now being transformed into the eating in culture. And
this trend is observed to be prominent among youth (15-34), especially in the
metropolitan cities where there are constant traffic jams and the heavy population
density, which results in even short distance travelling being a highly time-
consuming process. The resultant effect is that a greater number of Indian
households are being seen turning to online food delivery services as an easier and
more convenient alternative. As the usage of food delivery Apps grows in the
metropolitan cities in India, a growing trend is also being seen in smaller cities.

38
COMPANY

 This year, introduced the new business way to catch the market. In this year
the Zomato faced most of the loss in the delivery business in India. Zomato
spends more promotional marketing to catch users and be the first to market in
many cities in India. When caught in the market means it helps to reduce the
competitive delivery sector.

 Food delivery in India creates an entirely new market. Zomato creates an

opportunity to customers in Kolhapur 70% of customers first time enjoying
the experience of food delivery online.

 Three years ago, advertising representing 100% of Zomato revenue. Today

85%of revenue by transaction this difference shows Zomato growth in 3 years.

 Growth in transaction change in the model of advertising. The transaction and

advertising are separate lines of business. Comparing with host years the
revenue is brought back.

 Zomato also organizes a food carnival across the world in Delhi, Bengaluru,
and Pune. The main aim of the carnival is to create and showcase of the best
food items available in the city to the business. Zoma land hosted many
programs in carnival street performance, Dj music show. 120k people were
attending the carnival to explore a wide food area.

 The fund was raised by 10 investors and Zomato raise 140 million part of the
transaction. The profitability of Zomato in online food delivery is 3-4 million
in 15 months.

 The capital structure of Zomato is increased by year over year. Through,

highly influence of online food purchasing. And at present, the debt is $293
million, where the equity is $394 million.

 The sales growth of Zomato, in 2014 was increased by 5%. And in 2015, a
slight decrease of 2%. In 2016, there was a regain of 5% in sales increased by
effective sales promotions. And in 2017, there is an extremely high growth of
8%.

 Sales growth

39
 Profit growth

 Capital structure of Zomato

Between 2010 and 2013, Zomato raised approximately US$16.7

million from Info Edge India, giving Info Edge India a 57.9% stake in
Zomato.

In November 2013, it raised an additional US$37 million from Sequoia

Capital and Info Edge India.

In November 2014, Zomato completed another round of funding of US$60

million at a post-money valuation of US$660 million.This round of funding
was being led jointly by Info Edge India and Vy Capital, with participation
from Sequoia Capital.

40
 While in April 2015, Info Edge India, Vy Capital and Sequoia Capital led
another round of funding for US$50 million. This was followed by another
US$60 million funding led by Temasek, a Singapore government-owned
investment company, along with Vy Capital in September.

In October 2018, Zomato raised $210 million from Alibaba's payment affiliate
Ant Financial. Ant Financial received an ownership stake of over 10% of the
company as part of the round, which valued Zomato at around $2 billion.
Zomato had also raised an additional $150 million also from Ant Financial
earlier in 2018.

In September 2020, Zomato raised $62 million from Temasek, after previously
committed capitol from Ant Financial never came through.

In October 2020, as part of a Series J round of funding, Zomato raised $52

million from Kora, a US-based Investment firm.

In February 2021, Zomato raised US$250 million from five investors,

including Tiger Global Management, at a valuation of US$5.4 billion.

 Marketing strategies

1) customer targeting

2) positioning

3) focus on technology

4) strong brand name

5) promotion

 Mode of operation

(Step-1) Customer place order

(Step-2) Restaurant accepts order and starts preparing

(Step-3) Zomato assigns delivery partner

(Step-4) Delivery partner reaches restaurant

(Step-5) Order is pick up and delivered

3.3 OBJECTIVE ASSESSMENT OF LITERATURES

The economic growth and increase in the capital all factor gains fast food Culter
in India very fast. The main reason for customers preferring the online order
system is the delivery system. The growth of e-commerce also with the growth of
the food industry. The effective implementation of the advertisement and usage of
41
 social media also a factor easier for customers to order food in one click. The
pricing also depends on the market value and position. The satisfaction of the
customer is seen through electric food orders. People who work in IT mostly
prefer online food. In online food orders, customers can easily place their order as
per their wish and the customers can easily track the order. The online food order
also provides a feedback system customer can rate the food items. The based on
rating the Restaurant can improve along with the quality.

A simple and convenient way for the customer to purchase food online without
wasting the time. the customers want safe and reliable service. The customer
always prefers the food delivery App because the apps provide discounts and
cashback offers to the customer. A single window system for ordering a wide
range of restaurants. The delivery apps like Zomato, swiggy, etc play a role in the
food industry. Zomato treats, Zomato gold is premium membership the sales
management effectively utilizes their sales idea in Zomato.

Many of the food delivery companies in India but the entry of Zomato change the
all-food delivery industry. Zomato has reached heights of success and is
operational in 24 countries around the globe. Online food ordering and delivery
helps students to order their Favorite food at any time of the day. Online food
delivery systems also profitable and increases the production of restaurants
through online marketing. The customers need food at the door front they are
satisfied with the online food delivery. The customers focus on the quality and
hygiene of the food.

3.4 CONTRIBUTION BY THE STUDENT

Findings

 Most people order food online when they don't want to cook.

 People order food online every month most of the time. 6% users in daily,
33% users in weekly, 47% users in monthly, 4% users in yearly. (International
Journal of Advance Research and Innovative Ideas in Education)

42
 Most of the people come to know about online food delivery apps through
Internet, while some from their friends followed by advertisements and
Family.

 Many restaurant owners feel that they losing brand value and food become
the main commodity on the online delivery app.

 All apps provide a deep discount to attract customers and to catch the market.
The customers only focus on the discount, not the restaurant.

 Amazon world a large e-commerce portal trying to enter the delivery market
in India. Amazon ready to invest 3500 cores to take its own Indian business.

 In 2030 most meals we prepare at home will be also available online.

 Zomato creates an uber taxi partnership for the user to book a trip to the
restaurant and dining.

 Sometimes platforms have a fake review system. The app needs to verify the
authenticity of such reviews.

 Zomato allows the 300 street vendors in six cities Bhopal, Raipur, Patna,
Vasosara, and Nludhiana.

 Zomato starts a new dedicated team to help vendors in customer relations and
the fulfilment process.

 Zomato also provides a training program to new vendors about safety,

hygiene, and advanced packaging practices.

 Zomato pays more money to delivery partners because of the rising fuel price.

 Nowadays Zomato takeaway service is available at restaurants in zero

commission.

 Zomato Introducing monthly leave for women.

 Analysis of customer trends and customer's beliefs gave a large market to the
fighting competitive industry.

 Customers prefer Zomato because of the discount, good packing, and

transportation.

43
  Zomato and swiggy have a merging plan. The two delivery platforms are
competition each other. Merging gives a big wide expansion of the food
delivery business.

Suggestion

 Restaurants must focus on providing their customers the best quality food.

 They must also provide a variety of options in choosing the food or they may
keep an additional option where consumers can suggest them delicacies which
are unable in the restaurant.

 They must simplify the process of online food ordering as some old customers
have less knowledge and are uncomfortable with the recent technology.

 They must try to cover more areas as the area covered by them is limited.

 Improve the Hygiene.

 By adding new distribution channels, restaurant operators must increase the

online food ordering to attract more. of consumers.

 Advertising plays a very important role in the purchase of online ordering

foods as most Customers are like to purchase because of advertisements.

 According to International Journal of Trend in Scientific Research and

Development (IJTSRD) as most customers were between the age group of 20-
30 years so the company strategies should focus on that age group 20- 30
years. The company should focus on giving a better-quality product as most
customers were very brand loyal and were generally satisfied with the product.

CONCLUSION

To conclude this research on customer's perception of food apps, it is thus inferred

that a majority of people use food apps as it's the best way to save time and is
convenient. Even online food delivery service is an emerging market in India the
consumer prefers the traditional way of dining in the restaurant. Restaurants are the
place where people can sit and relax and spend their time with their family by having
their Favorite food. Most of the people prefer the restaurant with a good ambiance and
provide hygiene food. from the present study, it can be concluded that online food

44
delivery services have become a major trend and choice among the population of the
country. Zomato has gained the positive opinion of a majority of the consumers in
comparison to other service providers. It is mainly because of their better on-time
delivery and better discounts. Zomato has been in the first position in online food
delivery service provider and if it includes minor improvements, it will improve more
sustainability in the future.

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