• Team Business-360°

How Zomato Reached the Top One Delivery at a Time

Business Profile

The story goes that the founders of Zomato, Deepinder Goyal and Pankaj Chaddah, were working in their office when they saw a line of people waiting outside a restaurant for a chance to see the menu during their lunch break, resulting in the idea of Zomato in 2008.

Formerly called Foodiebay, the duo launched a basic website on their company network, which grew into Zomato, an app-based food delivery company and restaurant aggregator, based on tie-ups with food service outlets in urban Indian metros such as Mumbai and Delhi. As they realized the market potential of their idea, they expanded to other metros and tapped into second and third tier cities across the country. In 2019, Zomato had expanded globally to 24 countries.

Defining Traits

The most successful businesses are built on the basis of solving a customer’s pain point. Therefore, the bigger the problem, the faster the business growth. For Zomato, they targeted a crucial pain point - personal time! Taking the tedium out of waiting (read: wasting time) for one’s food order while standing outside a food service establishment was a problem worth solving especially in crowded urban Indian cities. Zomato also aimed at, and succeeded in, changing consumer habits in India, where 90% of the population doesn’t eat out at restaurants.

In the early years, small business start-ups like Zomato would’ve loved to have a ‘magic 8-ball’ that gave all the answers to what’s coming up. But without sufficient data and years in business, that is just a wish. Zomato is a prime example of a business that started small, listened to the voice of the customer, stayed agile enough to pivot as opportunities came up, and got the concept of ‘business scaling’ right. Here at Business 360, we like to impress upon small and medium business owners that the true test of an enterprise is its ability to scale their core operations and people, while also being able to change with the current situation (read more in the resource links below).

The food service industry is fickle, and the failure rate for restaurants is high. Given that Zomato earns its revenue through commissions on orders delivered and table reservations, they excel at keeping up with trends and engaging both sides of the aisle: the customer and their restaurant partners. With one ear to the ground, they stay relevant by having processes in place for collecting customer feedback and membership offers, and partnering with restaurants for their marketing and advertising needs. Zomato also offers targeted food service partner initiatives like Hyperpure, which supplies restaurants with fresh, responsibly sourced high-quality ingredients.

Continuing to scale up and move with market trends, Zomato successfully acquired Uber Eats- a food delivery service offered by Uber in early 2020. During the Covid-19 pandemic, they used the opportunity to satisfy an increasing trend in food delivery by creating protocols for sanitizing, cleaning, and contactless delivery. Today, Zomato satisfies hungry customers across more than 500 Indian cities, in addition to its global footprint. In July 2021, Zomato listed its shares in Indian stock markets and its initial IPO was oversubscribed 35 times, giving it a valuation of $12 billion.

At its core, Zomato continues to build on strong, forward-thinking company values by ensuring women make up 50% of their board, providing 26 weeks of paid parental leave to both women and men, and period leave to female employees. In addition, their non-profit ‘Feeding India’ provides meals for the unprivileged, and during the pandemic, they partnered with other such organizations to deliver much needed medical supplies and oxygen concentrators to hospitals.

Key Takeaways

Starting their business by solving a relevant customer pain point, and moving on to scale aggressively by following the flow of the market are the key aspects of Zomato’s success story. Even today, they don’t seem to lose sight of their customer’s needs, while also simultaneously contributing to the success of their restaurant partners, making sure to walk the fine line of keeping both sides satisfied. Underlying everything is an attitude of collaboration and strong company values - a true win-win for any business.

Learn more about Zomato Here:

Zomato - Delivering Delicious Happiness to Your Doorsteps!

What Zomato’s $12 Billion IPO Says About Tech Companies Today

Zomato IPO: Re-imagining the future of food

Design Your Organization to Scale Profitably: Business Perspective

Design Your Organization To Scale Profitably: Operations Perspective

Design Your Organization to Scale Profitably: People Perspective

What are Curated Business Stories?

At Business-360°, we take a holistic approach to understanding ‘what makes a business succeed or fail?’ in order to learn from them. To that end, we curate business stories for you, taking a look at the profile and defining traits of a particular company, followed by some key takeaways from their journey. Read more on each of these businesses and reach out to us for guidance in creating your own entrepreneurial roadmap. https://www.business-360.in/business-catalyst-program

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