Regaining partner trust in the food delivery business: case of Zomato

Abstract

Learning outcomes The learning outcomes are as follows: to understand and examine the strategies that help platforms fight competition and manage networks; to analyse the role of platform governance in the management of the networks and partners’ trust; and to evaluate the strategic risks of disintermediation and multi-homing firms face while trying to sustain profits and capture value. Case overview/synopsis The case presents the dilemma faced by Deepinder Goyal, the young founder and CEO of Zomato in formulating the growth strategy for its food delivery platform, struggling to retain its market leadership position amid intensifying competition and other challenges during the COVID-19 pandemic. Zomato has become a public company with an IPO announced in mid of July 2021. Therefore, there is growing expectation for profitability among its shareholders and investors considering tailwinds of COVID-19 crisis, which have given the push towards adoption of food delivery among the customers. This has also resulted in increased competition in the industry. On other hand, there is growing dissatisfaction among its restaurant partners who have been hit hard by COVID-19 and struggling for survival. CEO Deepinder has to find how he will ensure the long-term growth for Zomato to tap the growing food delivery market in India and regain its restaurant partner’s trust. Complexity Academic Level The case is intended for post-graduate courses (MBA, PGDM) on digital business strategy or strategic management of technology-oriented businesses. The case can be used to understand the nature of competition and different strategies for platform-based businesses in the digital world. The case can also be used to study the role governance can play in efficient value creation and capture on the platform by the partner entities. Finally, the case also highlights how are platform businesses are coping with the Covid challenge. There are no specific prerequisites but knowledge on basic strategy concepts and platform business concepts will be good for better understanding. Level of difficulty is medium. Supplementary materials Teaching notes are available for educators only. Subject code CSS 11: Strategy.

Analysing customers' reviews and ratings for online food deliveries: A text mining approach

“…To this end, OFDs (e.g., Zomato and Swiggy) are actively engaging in apps/technologies which use location data to assist consumers in finding various restaurants nearby which are available to take orders quickly. Furthermore, when the order is placed, the consumer is able to track the delivery partner until it reaches the final destination through in‐app GPS technology (Yadav & Goyal, 2022). Hence, such online food order tracking technology can also persuade customers to order food via OFDs.…”