Competition and Co-operation

in Business Ecosystem

Food Tech Hunger Games

Group – 2
Aadhil Ahmed 1911077
Meghana Priya 1911102
Rakesh Kumar Shetty 1911136
Krunal Kapadia 1911402
Subasis Naik 1911121
Priyanka Devarakonda 1911322
Harika Arravoth 1911379
Sivaprasad Inokondu 2013006

1
 Table of Contents
Executive Summary/ Abstract............................................................................................3
Food Tech Industry Analysis...............................................................................................4
Zomato and Swiggy Competitive analysis..........................................................................7
Zomato.........................................................................................................................................7
Swiggy..........................................................................................................................................8
Cooperation strategies of Zomato and Swiggy:................................................................10
Players........................................................................................................................................10
Competitive Relation..................................................................................................................10
Players – Zomato & Uber; Ola:.........................................................................................11
Players – Swiggy & Amazon:............................................................................................12
Players – Swiggy & Restaurants on platform:...................................................................12
Players- Swiggy; Zomato & National Restaurant Association of India (NRAI)...................13
Analysis of different features...........................................................................................15
The objective of the experiment.................................................................................................15
Experiment setup.......................................................................................................................15
Data Analysis...................................................................................................................15
Price elasticity and brand equity................................................................................................15
Nash Equilibrium..............................................................................................................16
Limitations.......................................................................................................................17
Sanity check.....................................................................................................................17
Conclusion........................................................................................................................17
Appendix..........................................................................................................................18
Analysis of the survey and calculation of payoffs:......................................................................18
References.......................................................................................................................18

2
Executive Summary/ Abstract

Ecosystem thinking has two perspectives – Biological Perspective and Business Perspective.
Both perspectives do not exist in isolation and interact with their respective groups to
maximize their profit or minimize their cost or share the resources for the greater advantage
of society and the wellbeing of communities. A business ecosystem using the biological
ecosystem has the capability to create and capture value through both cooperation and
competition.

To understand the complex framework of the dynamic, disruptive and networked

environment, this paper aimed to analyse competition and cooperation in the Food Tech
Industry using the game-theoretical perspective and its frameworks & axioms. In the Food
Tech industry, we have chosen Swiggy and Zomato as case/ Scenario and analyzed the
evolution of the Food Tech space through secondary research. The analysis brought the co-
operative and competitive strategies of Swiggy and Zomato and its value chain to its
partners, consumers and stakeholders. Analysis of present market conditions has led to the
thought-process that it can be considered a near duopoly, consisting of Swiggy and Zomato.
Analysis and evaluation have been done on premium features (Swiggy Super, Zomato Pro),
including strategies of both players and arrived at a point that pricing of the product,
reviews etc. are some of the major differentiators in their strategies. This analysis also
identified cooperation and competition scenarios prevailing between different players in the
Food Tech space. In one scenario, we considered profit to construct a market share, and in
another case, we considered market share. After evaluation, we arrived at the Nash
equilibrium for both methods. This paper tried to bring in the joint analysis to identify
important features for the customers. This also links to the before-mentioned competitive
and co-operative strategies of both players. Based on our analysis, evaluation and
experiment results, both players are involved in the price wars and, they have settled for
lower payoffs instead of having cooperation. We have arrived at a conclusion in the context
of Company, Customer and Competition. There are certain limitations attached to our
experiments like sample size, homogenous sample set, Biases, and Technology externalities.

Keywords: Swiggy, Zomato, Swiggy Super, Zomato pro, Zomato cooperation and
Competition, Swigyy Cooperation and Competition,

3
Food Tech Industry Analysis

Food tech, mainly food delivery is one of the most growing and attractive sectors for the last
five years. At first food tech industry started as listing platforms nearly a decade ago. At that
time, Zomato and Just dial were present where customer can find different restaurants and
evaluate restaurants based on their rating. In later stages, partnership started to develop
between restaurants and platforms. This stage focused on both restaurant discovery and
demand generation. At this stage, the platform started to work as an aggregator and left the
last mile delivery to restaurants. And we can call this stage Food tech 2.0. This model
worked well, but it does not address so many important issues such as delivery time,
delivery boy, Real-time order tracking, Hygiene and safety and customer support. As a result
of which, food tech 3.0 started. Here platforms also focused on the last mile delivery to the
customer and provided an end-to-end solution from restaurant discovery to order delivery
at the doorstep. Now we can see Food tech Platforms are diversifying their business and
started entering other categories like Pharma, grocery and alcohol delivery. They are also
leveraging this large customer base to expand into OTT, Payment and Mobility space and
Peer to peer delivery.i

Food Tech 4.0

Food Tech 3.0
Food Tech 2.0
Food Tech 1.0
On Demand Delivery
End to end of Items
Food offering • Pharma Grocery Alcohol
Aggregators
Discovery
Listing Platforms • Restaurant/Dish Discover • Peer to Peer Delivery of
• Restaurant Discovery Items
Restaurant Discovery • Demand Generation
• Demand Generation • OTT ,Payment platforms
• Last Mile Delivery
• Private (Cloud) Kitchens

Figure 1 Food Tech Industy Time Line

source: truegrit

4
Figure 2 Most Popular food delivery applications across India as of June 2020, by age

ii
Source: Statista
From the above graph, we can see Swiggy and Zomato has similar popularity among the
young generation, but for the older generation or gen Y, Swiggy is more popular than
Zomato.
By looking at the evolution of the FoodTech industry in numbers, we can say the Market size
of the FoodTech industry is increasing YoY. Hence, it can be considered as one of the
emerging and attractive businesses opportunities with a more than 100% increase in GMV.

Source: redseer.com
In the Food Tech Industry, aggregators offer low-value deals like single-serve, fixed-price
meals, free deliveries etc., to attract more customers. Hence, the Average Order Value
(AOV) decreases with an increase in the customer base and market size. Also, restaurant
owners have realized a 1.3x increase in total revenue after partnering with online

5
aggregators like Swiggy and Zomato. Average Order Value (AOV) is decreasing with an
increase in the customer base and market size. Restaurant owners have realized a 1.3x
increase in total revenue after partnering with online aggregators like Swiggy and Zomato.
iii
iggy and Zomato. Average Order Value (AOV) is decreasing with increase in customer
base and market size. Also, restaurant owners have also realized 1.3x increase in total
revenue after partnering with online aggregators like Swiggy and Zomato. iv

Source: redseer.com

With the advent of FoodTech 3.0, many startups experienced a surge in funding during
2014-2015. There were more than 850 food tech startups founded in a two-year span. The
industry evolved into providing end-to-end solutions in FoodTech 3.0, including the growth
of cloud kitchens. Popular cloud kitchen brands like Faasos, Box8, and Eatfit are leveraging
the brands of Swiggy and Zomato. These brands provide the opportunity to have economies
of scale, higher margin, and quality to aggregators. Therefore, it’s a win-win strategy for
both the players in the industry. To summarize, it started with many players in the
FoodTech space to near duopoly with the acquisition of UberEats by Zomato, and
Foodpanda was acquired by Ola. Currently it is dominated with two players Swiggy and
Zomato and making it duopolyv. These players are threatened by the entry of Amazon and
Google in this space.vihave economies of scale, higher margin, and quality to aggregators.
Therefore, it’s a win-win strategy for both the players in industry. vii To summarize, it started
with many players in FoodTech space to nearly duopoly with the acquisition of UberEats by
Zomato, and Foodpanda was acquired by Ola. Currently it is dominated with two players
Swiggy and Zomato and making it duopoly viii. These players are threatened by the entry of
Amazon and Google in this space.ix
The current landscape of the FoodTech space can be easily understood with the below
infographic.

6
 Figure:https://truegrit.substack.com/p/india-food-delivery-market-evolution

Zomato and Swiggy Competitive analysis

Zomato

Zomato is a restaurant search company that hosts a discovery app and website, providing
detailed information/reviews about the restaurant. They have expanded into Online
Ordering, Table Reservations, a White-label Platform, and a Point-of-Sale system aiming to
connect restaurants customers and people with technology. It started its operation in 2008
as the first startup dedicated to food tech industry. Zomato was a major player in north
India but to strengthen its position in the south. It acquired UberEATS in 2020. Currently,
Zomato is operating in 550+x Ixi and it served 1.33xii mn orders in 2019.And it had 2.3 Lakh
monthly active delivery staff in 2019 xiii. Unlike Swiggy, Zomato focused only on food so its
main aim is to become the one stop destination for all food related queries. In Zomato one
can order in, look for restaurants to go out for meal, look for menus of different
restaurants, book a table etc. If any restaurant is not delivering customers can check the
ratings and menu of that restaurant in Zomato. In Zomato one can see the average expense
for a one-time order or visit. Zomato has also started providing an insurance system where
by paying a sum of 20 one can avail an option for on time delivery or free. Zomato is also
tried to show itself as a socially conscious company so it has a xivFeeding India initiative
where one can contribute for the cause from the app itself. Currently Zomato started
targeting in the B2b segment with the option of Food@work . With this initiative it is trying
to partner with workplaces to provide a superior cafeteria experience.xvIt has some
important features like skipping queues where employees can order the food from their
desk itself, provide real time feedbacks and has plans of organizing food festival events. xvi
a subscription-based service called Zomato Gold to acquire customers and build loyalty. It
provided buy one get one dish offering in the selected restaurants while ordering and dining
in. It also provided free delivery for online ordering.xviihas discontinued this feature and it
has come up with Zomato Pro offering.xviiilk about this extensively, while comparing
Swiggy and Zomato in the later stage of the reportxixrestaurants to go out for meal ,look
for menus of different restaurants , book a table etc. If any restaurant is not delivering
customers can check the ratings and menu of that restaurant in Zomato. In Zomato one can
see average expense for a one time order or visit. Zomato has also started providing an
insurance system where by paying a sum of 20 one can avail an option for on time delivery
or free. Zomato is also tried to show it self as a socially conscious company so it has a CSR
initiative of Feeding India initiative where one can contribute for the cause from the app
itselfxxsegment with the option of Food@work . WIth this initiative it is trying to partner
with workplaces to provide a superior cafeteria experience.xxiIt has some important
features like skipping queues where employees can order the food from their desk itself ,
provide real time feedbacks and has plans of organizing food festival events. Zomato started
a subscription-based service called Zomato Gold to acquire customers and build loyalty. It
provided buy one get one dish offering in the selected restaurants while ordering and dining
in. It also provided free delivery for online ordering. Zomato has discontinued this feature

7
and it has come up with Zomato Pro offering.xxiiabout this extensively, while comparing
Swiggy and Zomato in the later stage of the report.

Swiggy

Swiggy started its operation in 2014 in Bangalore. Currently Swiggy is operating in 500+
Indian cities and has more than 100000+ restaurants as its partners . As xxiiiplayers in food
delivery place Swiggy started its operation with food delivery but it diversified its business in
various other domains to gain a competitive advantage. Unlike Zomato Swiggy did not
limited itself only with food delivery space, it is continuously trying to show its strength in
logistic and supply chain space.xxiv

Some important highlights associated with Swiggy’s business model are

Swiggy has its own digital wallet - “Swiggy money”. Swiggy, in partnership with ICICI bank,
launched this wallet where customers can do one click checkouts and get their refunds
within no time. Swiggy also partnered with Sodexo so customers can order foods using their
meal cardsxxv.

Swiggy has entered into Health hub, pet care and fresh food & sea food delivery space and
competing with players like Licious and petmate.

Swiggy POP - Swiggy pop is a single serving meal which has the price range of 99-200 and
the item is served between 30 to 35 minutes. Items like Indian Thalis, bowls, burgers and
Asian combos were there in Swiggy Pop menu.

Swiggy also has cloud kitchen service and it has its own private label stores. Swiggy has a
service for partners which is known as “Swiggy Partners”. There they can order premium
packaging material at reasonable price.
Their they can order premium packaging material at reasonable price.
Swiggy also started a service named “Genie”. It has similar business model as of Dunzo and
the service involve picking and delivery of wide array of items such as forgotten keys,
documents etc. Swiggy also started alcohol delivery in selected cities xxvi.

Swiggy started its operation of grocery delivery as “Insta Mart”. With Instamart it is directly
competing with bigbasket, grofers and amazon fresh for the grocery delivery service xxvii.

As we can see from the below infographics that FoodTech is growing with a CAGR of 25-30%
and, Number of orders are also increasing for the leading players. From the graph, we can
say that revenue of Zomato and Swiggy are comparable, but the expenses increased
drastically for Swiggy in FY 2020. Zomato and Swiggy’s net loss grew by 161% and 66%
respectively. We can say that Zomato’s financial performance is not consistent even after
spending far less than Swiggy. If we see the decreasing Average Order Value and Offerings
of both the leading players Swiggy and Zomato, these players are involved in intense price
war to acquire customers. This war of attrition indicates that both players are indulging in
price wars even after incurring heavy losesxxviii.

8
 Source: ajuniorvc.com

Source: Inc42.com

Source: Inc42.com

9
Cooperation strategies of Zomato and Swiggy:

The cooperation strategy involves self-interested players coming together to take a joint
action that generates a payoff. There is limited data available with respect to cooperation
strategies given both the companies are relatively new and not public. But from secondary
research we have identified several co-opetition strategies pertaining them. The following is
a summary of the co-opetition instances of Zomato & Swiggy:

Players – Zomato & Amazon

Co-operative Relation:
1. Zomato App was initially built on Amazon Web Services (AWS). The company
continues to use Amazon services for most of its digital needs xxix.
2. To enhance the search engine capabilities of the app, Zomato uses Amazon ML
solutions Lab’s capabilities via Amazon Textract and Amazon SageMaker.
3. Similarly, on another front Zomato partnered with Amazon prime video to promote
online food orders with the launch of Prime’s Mirzapur Season 2. This was done to
co-market Zomato alongside the most awaited series of the year

Competitive Relation
1. With the pandemic, delivery services have pivoted from traditional only food delivery and
diversified their services to on-demand delivery of goods and groceries. This puts Zomato
with direct competition with Amazon Marketplace that also delivers these products in a
similar digital setting.

2. Launch of Amazon food, now both Amazon and Zomato are directly competing in the
Food-Tech space.

Co-opetition Players Zomato- Amazon – AWS; Prime Video

Co-opetition Logic Efficiency in resource utilization; increasing size of the current
markets
Competition Area Food- Tech delivery platform
Value for Zomato Access to broader customer base; better operation of the service;
providing user high benefits through convenience and swift service
Value for Amazon Profits for running the service; providing users better service;

Players – Zomato & Uber; Ola:

Co-operative Relation:
1. The players entered a partnership to enable users book cabs to restaurants they are
planning to eat at. Zomato partnered with both the cab service providers for user
convenience mentioned above. Zomato also integrated ola money as a payment
method.
Competitive Relation:
1. Until the acquisition of UberEats by Zomato in Jan 2020, both Uber and Zomato were
in a head-on competition to maximize their market share in the food-tech business.
2. Similarly, Zomato competed with Ola Café- the parent company of FoodPanda.

10
 Co-opetition Players Zomato- Uber;Ola
Co-opetition Logic Efficiency in resource utilization; increasing size of the current
markets; enhancing user satisfaction
Competition Area Food- Tech delivery platform
Value for Zomato Access to broader customer base; providing user high benefits
through convenience and swift service
Value for Amazon providing users better service via additional features

Players – Swiggy & Amazon:

Co-operative Relation:
1. Swiggy App is built on Amazon Web Services (AWS). Swiggy uses AWS services to
drive cost savings, accelerate innovation and increase agility xxx.
2. Similarly, on another front, Swiggy partnered with Amazon Payments to provide
convenience for users with multiple payment options.

Competitive Relation
1. With the pandemic, delivery services have pivoted from traditional only food
delivery and diversified their services to on-demand delivery of goods and groceries.
This puts Swiggy in direct competition with Amazon Marketplace that also delivers
these products in a similar digital setting.

Co-opetition Players Swiggy- Amazon – AWS; Payment Services

Co-opetition Logic Efficiency in resource utilization and enhancing operation
capabilities
Competition Area Food- Tech delivery platform
Value for Swiggy Better operation of the service - drive cost savings, accelerate
innovation and increase agility; provide convenience for users with
multiple payment options.

11
 Value for Amazon Profits for running the service; providing users’ better service via
payments across food delivery platforms

Players – Swiggy & Restaurants on platform:

Co-operation Relation:
1. Swiggy acts as a medium between the consumers and the restaurants. The app
drives cross-side network effects, which drive restaurants to access a large number
of consumers. In order to reap these benefits, restaurants pay Swiggy some
percentage of their revenue as commission.
2. To reduce the initial capital invested in developing restaurants, Swiggy provides the
infrastructure to restaurants for cloud kitchen. This helps them to drive operations
without high investment.

Competition Relation:
1. Swiggy has developed its own private labels – The Bowl Company & Homely, in order
to cater to the needs of consumers better. The purpose of these private labels is a)
to drive user demand based on their preferred choice of meals
b) provide access to food delivery via cloud kitchens in areas with restaurant density
issues.
These private labels are in direct competition with the restaurants that operate on
the platform.

Co-opetition Players Swiggy – Restaurants on platform

Co-opetition Logic Efficiency in resource utilization and increasing the size of the
current markets; creating new markets
Competition Area High competition for restaurants, cannibalization for swiggy
Value for Swiggy to drive user demand based on their preferred choice of meals;
provide access to food delivery via cloud kitchens in areas with
restaurant density issues.

Value for Better access to the vast network of users; access to new markets;
Restaurants reduction in transaction costs

Players- Swiggy; Zomato & National Restaurant Association of India (NRAI)

Cooperation Relation:
1. As mentioned above, 50000 members of the NRAI use delivery app services to
connect with users and meet their demands. Similarly, the more the number of
restaurants/ suppliers on the platform- the more the user base. Delivery apps benefit
from the surplus of both users and suppliers.

Non-Cooperative Relation:

12
 1. The exorbitant commission percentages charged by these delivery platforms, as well
as norms for driving discounts set by these apps, is driving restaurants to losses. To
mitigate the oppression of these apps, NRAI has decided to come up with its own
delivery app benefiting its members. This app, currently in the making, will be a
competitor to Swiggy & Zomato.

Competitive strategies with Zomato Pro and Swiggy Super

Source: Zomato and Swiggy app

Zomato Pro VS Swiggy Super

As described earlier, Zomato provides a complete solution in terms of food, so it is providing

solution both in terms of Dine and food delivery option. It provides discounts on both
options. Swiggy Super is available only in the food delivery space, and it provides discounts
only in the food delivery space, while swiggy provides multiple options. These options
provide flexibility to consumers so that they can try various options at affordable prices. This
can be considered as a good consumer acquisition strategy as the try-out option is available
from 89 Rs/month only. Other options are called Bite and Binge, which are available at the
prices of 169 and 329 Rs, respectively.

13
Zomato provides differentiation in terms of dine-in, reviews and ratings, and priority orders.
Zomato pro includes 40% off on each dining experience and 30% off on food deliveries xxxi.
With Zomato Pro, customers can access a two-day festival with unbelievable offers called
Zomato Pro days. Swiggy super offering BIT provides 15 free deliveries for a 3-month plan.
BITE provides 30 free deliveries and Buy 1 Get 1 from select restaurants. BINGE includes
unlimited free deliveries and Buy 1 Get 1 from select restaurants xxxii. Both companies are
indulging in price wars to acquire the maximum number of consumers from their offerings.
It will be interesting to look at the Swiggy’s Buy 1 Get one feature and its impact on
financials, as Zomato dropped it from its previous offering Zomato Gold.

Analysis of different features

The objective of the experiment
We wanted to find out the price elasticity of consumers and deduct the demand curve for
both Swiggy Super and Zomato Pro. With the demand curves, we will figure out the
respective market shares that each player will have, given their pricing strategies. Finally, we
would construct a payoff matrix indicating market shares and find out the Nash equilibrium.
We would compare the equilibrium responses with their current strategies and suggest an
optimal recommendation for both Swiggy and Zomato to maximize their returns.

Experiment setup
We created a short survey gauging the important factors consumers consider when
subscribing to a food delivery platform. We did a Conjoint analysis to figure out the features
with topmost priority. We then created a set of 9 questions keeping different features and
price points for both the players. Zomato, in practice, has a single subscription package for
Rs.200. We created two more packages, viz Rs.100 package with lesser features and Rs.400
package with maximum features possible. We then asked consumers to rate the
attractiveness of each offer. The attractiveness is used as a proxy for market share
calculations. The responses are normalized on a scale of 100, and the resulting numbers will
be their respective market shares for different price points.
Link to the survey:
https://iimb.qualtrics.com/jfe/form/SV_79RUduDPLc68HqK

Data Analysis
We collected around 120 responses for our analysis. From our conjoint analysis, we figured
out that Price and Discounts on food are the two most important factors when subscribing
to a food delivery service. We presented a set of 9 questions, out of which each participant
randomly answers four questions. As mentioned above, the attractiveness of the package is
directly proportional to the number of people likely to purchase that package. Based on
that, the market shares are calculated, which is shown in the below table.

Zomato Attractiveness Normalized Swiggy Super Attractiveness Normalized

Pro Market share Market share
400 7.5 55.15% 749 6.1 44.85%
400 6.1 51.26% 399 5.8 48.74%
400 5.8 47.15% 229 6.5 52.85%

14
 200 8 61.07% 749 5.1 38.93%
200 7.8 56.93% 399 5.9 43.07%
200 7.1 52.21% 229 6.5 47.79%
100 8.95 73.66% 749 3.2 26.34%
100 7.25 56.16% 399 5.66 43.84%
100 7.43 52.86% 229 6.625 47.14%

Price elasticity and brand equity

Using the market share data for each price points, we figured out the demand curve for
Swiggy and Zomato. Even though Swiggy seems to have a better market share in practice,
the experiment provided different results, which occurred mainly due to difference in the
price points. It seems that the utility derived from the features given is lesser compared to
the price point at which the subscription package is offered. The demand curves (X-axis –
Price, Y-axis – Market share) are calculated and displayed below.

Zomato Demand Curve Swiggy Demand Curve

65.00% 55.00%
60.00% 50.00%
55.00% f(x) = − 0 x + 0.64
45.00% f(x) = − 0 x + 0.54
50.00%
45.00% 40.00%
40.00% 35.00%
35.00% 30.00%
30.00%
25.00% 25.00%
20.00% 20.00%
50 100 150 200 250 300 350 400 450 200 300 400 500 600 700 800

When we calculated the elasticity, it seemed like Zomato’s customers are more inelastic,
meaning there are more loyal customers in Zomato than Swiggy. Hence, even though
currently, Swiggy has a larger customer base, in terms of loyal base, Zomato edges over
Swiggy. The reason for this is mainly the price at which Zomato offers its “Pro” package,
compared to Swiggy’s three-tiered package, all of which are costlier than Zomato.

Nash Equilibrium
The Nash equilibrium is constructed with the payoffs as expected profits with the given
market share data obtained from the survey. To calculate the expected profits for each price
point for Zomato and Swiggy, we used the cost and revenue figures of 2020 xxxiii and
normalized the numbers to get an expected profit figure.

We took fixed costs as 70% and variable costs as 30% of the annual cost figures. We
assumed a market with 100 people for simplicity. We split the fixed and variable costs
according to this figure. Now, if Zomato’s market share is 60%, for example, there are 60
people in the market who choose Zomato Pro. After normalizing the figures, we used the
following equation to calculate the payoffs.

Payoff (Expected profits) = Price*Market share + Fixed cost + Variable cost*Market share

15
The fixed and variable costs included were taken per person figures as per the assumption
of 100 people market. The appendix has the excel, which consists of all the calculations,
which results in the below figures.

Swiggy Super
Zomato Pro
229 399 749
100 (2020, 2312) (2244, 3538) (2618, 4858)
200 (3738, 2667) (4112, 4259) (4410, 7373)
400 (6875, 2962) (7473, 4878) (8071, 8534)

As expected, both companies get the highest payoffs in case of their highest price points of
400 and 749 for Zomato Pro and Swiggy Super, respectively. In this case, no company has an
incentive to deviate from their strategy. But if we compare this with the practical
happenings, we get counterintuitive results. Both companies are engaged in a fierce price
war. The firms have not seen a profitable quarter yet. Alternatively, their losses are
increasing YoY 50% and morexxxiv. Their primary payoff is obtaining the highest market share.
In that case, finding a Nash equilibrium with market share as payoffs make more sense.

Using the market share data, we figured out the Nash equilibrium for both the players,
which can maximize their mutual payoffs without any incentive to deviate. As we can see,
Zomato’s strategy of Rs.100 and Swiggy’s strategy of Rs.229 constitutes the Nash
equilibrium, giving a market share of 58% and 42%, respectively.

Swiggy Super
Zomato Pro
229 349 749

100 (58,42) (64,36) (74,26)

200 (52,48) (57,43) (61,39)

400 (47,53) (51,49) (55,45)

Limitations

Our Sample set was limited to IIM Bangalore only. In survey-type experiment, it is difficult to
make respondents perceive the importance of features offered for each price points. So,
there might be price bias. In practice, Swiggy has a higher market share than Zomato due to
its first-mover advantage and attractive discount offers during special occasions. E.g., IPL.
Keeping those aside, if we objectively compare these two experimentally, Zomato is better
because of its price offerings.

16
Sanity check

In our initial conjoint analysis, Price was quoted as the most important factor considered
while subscribing to a delivery platform. Nash equilibrium obtained is at (Rs.100, Rs.229),
which corresponds with the above findings. So, we can conclude that our model is correctly
depicting the customer perception.

Conclusion

Company

Having diverse subscription options at different price points helps to tap into a larger
customer base. Low prices and discounts on food orders should be implemented to capture
a larger market share

Competition

Nash equilibrium in the market occurs at the lowest prices, which necessitates the need to
have a lower-tier pricing closer 3-tier pricing (Zomato) generates more demand than
Swiggy’s farther 3-tier pricing

Customer

Low price and Discounts on food on the most attractive options for increasing customer
base
Utility derived by lower prices is higher than utility derived through unique features in the
offering.

Appendix

17
Analysis of the survey and calculation of payoffs:

Copy of Analysis
Part.xlsx

References

18
i
https://timesofindia.indiatimes.com/india/swiggy-to-hire-3-lakh-people-in-18-months/articleshow/71657670.cms

ii
Rakuten Insight. (July 31, 2020). Most popular food delivery applications across India as of June 2020, by age [Graph]. In Statista. Retrieved
March 15, 2021, from https://www.statista.com/statistics/1149302/india-popular-food-delivery-apps-by-age/

iii
https://redseer.com/newsletters/food-tech-market-updates-june18/

iv

v
https://inc42.com/buzz/zomato-swiggy-duopoly-the-fallout-from-the-uber-eats-acquisition/

vi
https://ajuniorvc.com/foodtech-endgame-ubereats-acquisition-swiggy-zomato-amazon/

vii
https://www.linkedin.com/pulse/india-food-delivery-market-evolution-road-ahead-ankit-arora/
viii

ix

x
https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/zomato-to-raise-up-to-usd-600-mn-by-next-
month-deepinder-goyal/articleshow/72404683.cms?from=mdr

xi
https://inc42.com/features/whats-the-story-of-zomato-origin-journey-and-evolution/
xii
https://ajuniorvc.com/foodtech-endgame-ubereats-acquisition-swiggy-zomato-amazon/

xiii
https://timesofindia.indiatimes.com/india/swiggy-to-hire-3-lakh-people-in-18-months/articleshow/71657670.cms

xiv
https://timesofindia.indiatimes.com/business/india-business/zomato-buys-ubers-indian-food-delivery-
business/articleshow/73464916.cms#:~:text=This%20acquisition%20significantly%20strengthens%20our,Deepinder
%20Goyal%20in%20a%20statement.&text=The%20deal%20is%20attractive%20for,area%20for%20main%20rival
%20Swiggy.

xv
https://www.zomato.com/business/foodatwork
xvi

xvii

xviii
https://www.zomato.com/blog/zomato-pro

xix

xx
https://www.zomato.com/blog/fighting-hunger-and-wastage

xxi

xxii

xxiii
https://www.nationalheraldindia.com/national/swiggy-now-in-500-indian-cities-targets-100-more-this-year

xxiv
https://gadgets.ndtv.com/apps/news/swiggy-money-digital-wallet-icici-bank-launch-india-food-orders-
2254434#:~:text=The%20food%20delivery%20platform%20has,made%20through%20the%20Swiggy%20app.

xxv
https://gadgets.ndtv.com/apps/news/swiggy-money-digital-wallet-icici-bank-launch-india-food-orders-
2254434#:~:text=Swiggy%20Money%20has%20been%20launched%20as%20Swiggy's%20native%20digital
%20wallet,of%20Amazon%20Pay%20and%20Paytm.&text=Just%20like%20other%20mobile%20wallets,made
%20through%20the%20Swiggy%20app.
xxvi
https://gadgets.ndtv.com/apps/news/swiggy-grocery-delivery-genie-pickup-drop-service-coronavirus-outbreak-
2208816#:~:text=Swiggy%20Genie%20provides%20a%20way,the%20pickup%20and%20drop%20points.

xxvii
https://www.dnaindia.com/analysis/report-swiggy-vs-zomato-battle-of-india-s-biggest-food-aggregator-2820924

xxviii
https://inc42.com/buzz/swiggy-outpaces-zomato-in-revenue-race-despite-66-higher-losses/

xxix
https://aws.amazon.com/blogs/machine-learning/zomato-digitizes-menus-using-amazon-textract-and-amazon-
sagemaker/

xxx
https://my.intricately.com/companies/swiggy

xxxi
https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/zomato-gold-becomes-pro-with-nearly-50-
more-restaurants/articleshow/76708662.cms?from=mdr

xxxii
https://freekaamaal.com/swiggy/swiggy-super-membership

xxxiii
https://inc42.com/buzz/swiggy-outpaces-zomato-in-revenue-race-despite-66-higher-losses/
xxxiv
https://inc42.com/buzz/swiggy-outpaces-zomato-in-revenue-race-despite-66-higher-losses/