NRAI refuses to support the launch of Zomato Gold on food delivery

NRAI said extension of Gold to delivery would be 'suicidal' for the vertical

Food aggregator Zomato on Saturday launched the Gold subscription plan for its delivery services, but restaurants that have been opposing deep discounts continued with their stance.

Zomato Gold is the company’s premium plan allowing subscribers to have free dishes as part of their orders at restaurants. On Saturday, besides introducing it for deliveries, Zomato expanded the service to 25 new cities. Earlier, it was available in 16. 

“Gold drives 25-30 per cent business for its restaurant partners and more and more Gold users (90 per cent) are exploring new restaurants because of the program. It makes eminent sense to extend this discovery behaviour to the delivery restaurant base,” said Gaurav Gupta, co-founder and chief operating officer, Zomato.

Existing members of Zomato Gold will have access to food delivery privileges for no additional charges, along with some fair usage policy revisions in their existing membership. They will, however, be limited to two “unlocks” per day — one in dining-out and one for delivery. 

Membership will also be limited to a single device per person. If any existing members are unsatisfied with the revisions, Zomato will offer refunds on a pro-rata basis, it said in a statement. Gold on delivery will offer the second-highest priced item on the order free, except for combos, special dishes and items sold for the maximum retail price. 

Customers will be able to avail the offer only on orders of Rs 300 or above, and the discount will be capped at Rs 300 per order. New users will pay Rs 1,800 for an annual package that will give them access to dining out and delivery privileges.

Restaurants, however, were not happy with this. The National Restaurants Association of India (NRAI)  called it a “desperate attempt” by Zomato to save Gold and suicidal for the delivery vertical. 

“We expressed our reservations unequivocally to the Zomato team in our recent talks. However, in utter disregard to the viability of the restaurant fraternity, they have chosen to extend the programme further to the delivery vertical as well. 

This will be calamitous to the business in the delivery segment and we appeal to all restaurants and cloud kitchens entrepreneurs to stay away from Zomato Gold on delivery. Offer right quality at the right price, rather than falling for such discount gimmicks,” said Anurag Katriar, president of the NRAI.

A Zomato spokesperson said, “We have been in constant discussions with the NRAI and have received a lot of useful feedback from them and partner restaurants on the Gold program. We have made significant changes to ensure sure that the program continues to be attractive for our members while becoming more sustainable for our restaurant partners.”

More than a month after launching a protest against food aggregators’ deep discounting practices, the NRAI has remained steady on its stand that they do not want to be part of Zomato Gold or any other deep-discounting schemes.

The NRAI launched a #Logout campaign on August 14 against aggressive pricing and deep discounting by restaurant aggregators, but over time, has expressed greater unhappiness with Zomato Gold.

Earlier this week, the NRAI said talks with restaurant aggregators including Zomato, Swiggy, EazyDiner and so on had progressed well on certain issues. 

The issue has been going back and forth between both sides since over a month now, even though Zomato has made changes to its Gold offering.