- Revenue of Zomato in FY20 grew by 105 percent compared to FY19, while costs in the same period grew by just 47 percent.
Revenue of Zomato in FY20 grew by 105 percent compared to FY19, while costs in the same period grew by just 47 percent. In FY20, moving the business toward profitability was a key goal for the organization, and there appears to be substantial progress.
Zomato has been fast-tracking the efforts to make the company profitable and turn productivity into investment in the last few quarters. Although COVID-19 has impacted the size of the company, the path to profitability has been accelerated. Concerning the scale of the company, COVID-19 has set back by about a year – but a year is just a tiny blip when you’re developing a company for the next 100 years.
Having said that, COVID-19 has had a positive impact on Zomato’s company performance. The organization expects to make a full recovery over the next 3-6 months while maintaining strong cost/profitability management.
In January 2020, Zomato acquired Uber Eats India company that helped to propel them to market leadership in this hotly contested area. The transition of users and merchants from Uber Eats India to Zomato was swift, and so well coordinated by both teams that 97 percent of the combined GMV on the Zomato app could be transferred and retained.
Right after the rise of COVID-19 cases in India towards the end of March, the food delivery GMV hit its lowest point in two years – GMV was 80% down in the last week of March 2020, compared to our peak pre-COVID-19 week (in mid-February).
The food supply GMV has now recovered to 60 percent of pre-COVID levels. Zomato has taken several important measures to ensure the health of our customers supplying food, which has been a major driver of the turnaround in our company so far.
Zomato’s B2B segment, Hyperpure is that strong, and the firm believes they have early signs of a good product-market match. Hyperpure has represented only Delhi and Bangalore, so far. Over the past two years, the organization has covered a lot of land and is now quickly expanding into new cities.
The COVID-19 crisis was badly hitting the daily wager community – resulting in widespread hunger across the country. Feeding India (the Zomato Feeding Foundation’s India chapter) launched a ‘Feed the Daily Wager’ campaign to raise money and provide food help to the daily wagers who lost their livelihood during the COVID-19 lockdown. Feed the Daily Wager raised about $32 Cr (~$4.2 m) for delivery of over 65 million meals.
Recently, Zomato launched an initiative to rebrand Zomato Gold to Zomato Pro — and make it a wider, more all-encompassing membership that unlocks exclusive privileges and discounts at the best restaurants by dining out and delivery. Besides several never-seen-before exclusive benefits on the Zomato app, this is also a special money-back guarantee for all Pro members.
All members of Zomato Gold across 10 countries will be upgraded to Zomato Pro automatically starting August 1, 2020.
Members of Zomato Pro will continue to enjoy current deals (on Zomato Gold) across a wide variety of restaurants — from fine dining hotspots to legendary restaurants, cafes, and bars.
You can find the whole report here.