Quick commerce company Zepto will launch a separate app for Zepto Cafe, its 10-minute food delivery unit, next week, co-founder and CEO Aadit Palicha announced on social media on December 11.
While Zepto Cafe will be available through another app, customers will also have an option to shop for coffee, sandwiches and more via the main Zepto app.
Zepto’s move to have two entry points is similar to what Zomato did with Blinkit, the company’s quick commerce arm, over a year ago. While Zomato piloted having two entry points for Blinkit for a few months, it decided to spin off Blinkit as a separate app since it saw better results with a stand-alone app.
For a long time, analysts, founders and other stakeholders have debated if companies should go the Zomato way (super apps) or the Swiggy way (super brands). While Zomato launches every new offering as a separate app (Blinkit, District and Zomato), Swiggy houses all its offerings (Swiggy, Swiggy Instamart, Dineout) in the main app.
Zepto’s approach is a mix of both, for now.
“There is a significant consumer top-of-mind advantage to a separate app and we are seeing the economics work stand-alone. So, a stand-alone app makes sense. Users will still be able to order Café products on the main Zepto app,” said Palicha.
He said Zepto Cafe is scaling fast. “Cafe is scaling rapidly: we’re launching 100+ cafes a month and already clocking 30,000 orders per day,” he posted on X.
Earlier in the year, Zepto said Cafe is an important part of the business and is already clocking an annualised revenue run rate (ARR) of Rs 160 crore and is projected to touch Rs 1,000 crore in ARR by 2026.
10-minute food delivery wars
Zepto’s move to launch a new app just for Cafe comes at a time when the company is doubling down on food delivery to tap into additional revenue streams, beyond groceries and others that are delivered in 10 minutes.
Last month, Swish, a rapid food delivery firm, raised $2 million from Accel and a clutch of angel investors to compete with Swiggy’s Bolt, Zomato Everyday and Zepto Cafe and others at a time when an increasing number of companies are looking to ride the success of quick commerce in India and deliver food in 10 minutes.
In fact, 5 percent of all food delivery orders are placed via Swiggy Bolt, the company said during its quarterly call.
Zomato chief Deepinder Goyal and Swiggy CEO Sriharsha Majety, in interviews to Moneycontrol, also highlighted that 10-minute food deliveries will be the next frontier.
