The country’s oldest food aggregator and discovery major Zomato on Tuesday said its revenue more than tripled in the first half (H1) of 2019-20 (FY20) to $205 million, compared to $63 million in the same period last year.
The company, in news recently for laying off more than 600 employees and facing massive backlash from restaurants for its premium membership programme Gold, said its monthly burn rate is down to 60 per cent, compared to six months ago.
In a report released by the Deepinder Goyal-led firm, Zomato vehemently defended its premium membership, claiming that the number of restaurant partners have increased after the #Logout campaign. Gold, which allows paying members to avail of free dishes and drinks at member restaurants, has been at the centre of a controversy since August.
Restaurant associations have said the programme, initially aimed at premium diners, has encouraged deep discounting — the costs of which are borne by restaurants. Even amidst this opposition, Zomato has tweaked the programme and expanded it to its delivery services.
On Tuesday, it said Gold had gone from discovery to loyalty. “We now have 1.4 million members worldwide on Zomato Gold, who are using their privileges more than thrice a month. Gold is a niche, but large loyalty programme. So far, less than 5 per cent restaurants participate in Zomato Gold, and less than 5 per cent of our monthly active users are Gold members. There’s so much headroom to grow here,” the report stated.
The National Restaurant Association of India (NRAI) had 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.
The last round of discussions between the NRAI and the aggregators was held around end-September. There is no consensus on the issues raised by the NRAI yet. Zomato, on its part, again claimed that Gold is a success and would be part of the company’s plans. It even gave out a few numbers to prove its point.
“At the start of the #Logout campaign, we had 6,100 restaurants in India on Zomato Gold for dining out. As of today, we have 6,300 restaurants in India on Gold. In addition, we have 10,000 restaurants participating in the recently launched Zomato Gold for delivery. The number of restaurants participating in Gold outside of India stands at 6,500,” Zomato said in the report.
Since April, Zomato food delivery services have expanded from 200 cities to over 500 cities across India. Its order volumes in the top 15 cities doubled in the past 12 months, while the rest contribute 35 per cent to its order volumes. In the first half of 2018-19 (FY19), Zomato recorded 55 million orders, while in the first six months of this year, this number rose to 214 million orders.