Food delivery startup Zomato might be dealing with an extended campaign by restaurant associations, but the company continues to double down on its contentious Zomato Gold programme. Earlier this week, CEO Deepinder Goyal announced an enhanced set of benefits under a new programme called Zomato Gold Special, which will be in addition to the discounts and offers already provided under the existing incentive programme.
“For our Gold customers, to extend their Gold privileges, we will soon add some special deals and offers from some of the biggest and busiest restaurant names in the industry (all on top of what we already have on Gold),” Goyal said. Under the new programme, Gold customers will also have the privilege of free valet parking in many malls.
The decision comes even as the spat between food delivery majors like Zomato and Swiggy and the National Restaurants Association of India (NRAI) has reached the table of the commerce minister. The restaurants association has alleged that the Zomato Gold programme’s deep discounting was affecting their business, and started a #logout campaign in August under which it claims thousands of restaurants have signed out of the Zomato platform.
However, Goyal addressed the protests in his statement, noting that over 70 per cent of its respondents in a survey it conducted following the protests have said the changes it has made were good for restaurants. “A few weeks back, we witnessed a restaurant led push against Zomato Gold, where some restaurants abruptly ‘logged out’ of Gold expressing some dissatisfaction with some user policies of Gold. That led us to speak to and collect feedback from hundreds of our Gold partners. Based on the feedback we received, we rolled out some changes to Gold,” the CEO said.
Among the changes instituted, Zomato’s survey found that 40 per cent found the limiting unlocks per table to two was the most valued change for restaurants. Goyal added that discontinuation of Gold trial packs were not a major concern for the respondents with only 9 per cent highlighting this as a concern.
“Over 70% of the respondents agreed that the changes we introduced in Gold made it a more sustainable programme for restaurants to participate in,” Goyal said. According to the firm, the Gold programme brought in 1.10 lakh new Gold members in October.
Cash burn reduced sharply
Meanwhile, top executives from Info Edge, which holds 26 per cent of Zomato, pointed out on Tuesday that the start-up has managed to nearly halve its cash burn rate to around $20 million in October, from around $45 million in March this year. “They have a clear agenda to keep cutting burn, while still growing orders,” Sanjeev Bikhchandani, executive vice chairman of Info Edge told analysts during the company’s quarterly earnings call. Zomato had stated in October that its revenue for the first half of the current financial year rose three-fold to $205 million, against just $63 million last year.
Steady expansion recorded
Zomato currently delivers 1.3 million orders a day from 150,000 restaurants across India at more than 10 orders per restaurant per day. The start-up also operates kitchens in 50 cities across the country, with 110 kitchen hubs in the works.