Zomato has an average monthly users of 41.5 million people. That is a good number by all measures and no brand gets that kind of number without getting something right. There are a few key factors that make Zomato unique compared to other food ordering and delivery platforms:
- Wide range of services: Zomato not only allows users to order food from restaurants, but it also provides information on restaurants, cafes, bars, and other food establishments. Users can browse menus, view photos, read reviews, and make reservations through the platform.
- Global presence: Zomato operates in about 24 countries, including India, the United States, Canada, and Australia, making it one of the largest food ordering and delivery platforms in the world.
- Focus on user engagement: Zomato encourages users to engage with the platform through features such as writing reviews, creating user-generated content
Zomato Business Model – How it Makes Money
Zomato in itself does not sell food as one its services yet the revenue is perhaps more than that of any restaurant around. The Zomato business model is a subscription and advertising-based model.
But there are a few other ways the Zomato business model brings money:
1. Commission on food orders
One of the primary ways Zomato makes money is by charging a commission on every food order placed through its platform. The company typically charges restaurants a commission fee of around 20-25% on each order, which is paid out of the restaurant’s revenue. This revenue model is actually popular among food delivery platforms. And it allows Zomato to earn a substantial amount of money from its restaurant partners.
Another major way the Zomato business model brings money is through advertising. The company allows restaurants to advertise on its platform to reach a wider audience. Restaurants can pay to have their ads displayed prominently on the Zomato app and website. Of course this is with the hope that it can help drive more traffic to their businesses. Zomato also allows restaurants to create sponsored listings, which appear at the top of search results and are marked with a “sponsored” tag. This is similar to what you see on Google search also.
3. Zomato Pro
Zomato Pro is another way Zomato business model brings revenue to the company. It is a subscription-based service that offers discounts and perks to customers who pay a monthly fee. Customers who sign up for Zomato Pro can enjoy discounts on food orders, early access to restaurant deals, and other exclusive benefits. Zomato Pro is a popular service among frequent users of the platform, and it helps the company earn recurring revenue from its customer base.
4. Online ordering system
In addition to its food delivery platform, Zomato business model also offers an online ordering system that restaurants can use to accept orders directly from their customers. This system is designed to help restaurants save money on commission fees. Nonetheless, Zomato still earns a fee for providing that service. Zomato charges a fee of around 7-8% on each order processed through its online ordering system.
5. Restaurant software
Zomato also offers a range of restaurant software solutions to help restaurants manage their operations more efficiently. These solutions include POS systems, inventory management software, and table reservation software. Restaurants that use Zomato’s software pay a monthly fee, which allows Zomato to earn recurring revenue from its restaurant partners.
6. Zomato Gold
Zomato Gold is a premium subscription based service offered by Zomato. It started in 2018 and is a paid service that allows customers with Gold memberships get complimentary food and drinks at the time of ordering from partner bars or restaurants.
However, the Gold service is only applicable to dine in orders and not available for deliveries. And this can only be used once at each partner restaurant in a day.
Zomato Business Model – The Wrap
In conclusion, Zomato business model provides several revenue streams that allow it to earn money from both its customers and restaurant partners. From commission on food orders and advertising to Zomato Pro, online ordering system, and restaurant software, the company has developed a comprehensive business model that has helped it become one of the leading food delivery and restaurant discovery platforms in the world.
Zomato business model
More posts on business models: