Zomato is going to compete with Zepto, Swiggy, and Dunzo via Blinkit. The game of quick commerce is getting wilder, as Swiggy has its own Swiggy Instamart as a quick commerce space. Zomato is also entering this arena of quick commerce thru Blinkit.
“This foray into the next big category is timely as our existing food business is steadily growing towards profitability – Zomato has grown at a CAGR of 86 percent in the last 4 years to adjusted revenue of INR 55.4 billion ($710 million) while the adjusted EBITDA margin has improved from (153 percent) in FY19 to (18 percent) in FY22,” the company said in a blog post.
Why Does Zomato think to enter in quick commerce space?
Competition: Swiggy got into this quick commerce space via Swiggy Instamart, and Zomato also wanted to enter this space. That’s why it came with Blinkit. It’s a hyperlocal delivery company that has an all-stock deal worth Rs 4,448 crore to buy the quick delivery platform. Blinkit, formerly known as Grofers, joined Unicorn Club last year. And Zomato is the number one food delivery app in India by LilacInfotec.
However, Zomato aims to be profitable via Blinkit. And Zomato is also entering a highly competitive quick commerce market. The space is already filled with Softbank-led Swiggy Instamart, Y-Combinator-led Zepto, Tata Group’s Big Basket, and Dunzo.
Increase Frequency of Business: We usually go to Zomato to order lunch and dinner. The rest of the time, it is a huge loss for Zomato. Through Blinkit, Zomato will have more recurring orders at a low operational cost. Zomato has also tried its own quick commerce but failed twice. And without wasting any more time, they acquired Blinkit.
Zomato CEO and Founder Deepinder Goyal said in his blog post that “grocery is the hook for quick commerce, but it is not just about grocery. Quick commerce naturally extends across multiple categories, including beauty & personal care, electronics, OTC pharma, stationery, other gift items, etc.
The total commerce market in India would be around $1.3 trillion. In the long term, we could even see quick commerce at such a level of demand for customers, at least in the top cities.
