Foodtech leader Zomato, known for its innovative approach, has widened its platform fee initiative. Originally introduced at INR 2 per order for specific users, the fee is now extended to a broader audience and has seen a rise.
Tier-wise Charging Strategy
In Tier II cities, Zomato has initiated a platform fee of INR 3 for some users. Conversely, users in metro cities seem to face a standard INR 2 platform fee. This tier-wise approach suggests a strategic calibration to cater to diverse markets.
Zomato Gold Users Affected
Notably, Zomato has altered its stance on Zomato Gold subscribers. Previously exempt from this fee, these users are now subject to the platform fee. This shift reflects Zomato’s evolving business strategies.
Zomato Perspective
A representative from Zomato clarified, “Platform fee will be applicable for all our customers. We are still in the experiment stage, and are gradually rolling it out across India.” This measured approach highlights Zomato’s cautious expansion strategy.
Profitability Focus and New Features
Amidst these changes, Zomato is striving for profitability. Following in the footsteps of its competitor Swiggy, the platform fee can be seen as an effort to generate additional revenue. This development coincides with Zomato’s continuous efforts to enhance its platform, including the introduction of new features such as a multi-restaurant cart and explorations in generative AI.
Zomato’s platform fee expansion reflects its adaptability to market dynamics and evolving user needs. By catering to distinct markets and revising policies, the foodtech giant positions itself for continued growth and profitability. As the foodtech introduces new features and navigates its evolving business model, its profitability journey gains momentum, highlighted by its recent shift to profit in the first quarter of FY24.
