Food-tech sector has witnessed a new set of growth in last two years, as the ease and the options that these food-tech players provide has already made online food delivery a darling in most Indian cities. Also, a recent study by the Indian Brand Equity Foundation concluded that India’s food delivery market alone is worth $15 billion today. In yet another study, conducted by business consultancy firm Market Research Future, it was found that the food delivery market of the country is likely to grow at over 16 per cent annually and touch $17.02 billion by the year 2023.
The Pre-Aggregator Era
“When we started in 2013 we knew that biryani was liked at every home and could be scaled at the likes of McDonald’s, Domino’s or Pizza Hut. There was no Swiggy or Zomato and at only one store we were 70 per cent delivery brand,” shares Raymond Andrews, Co-Founder, Biryani Blues that has tied up with all major delivery players apart from their own delivery network. “Since then we have come a long way and for us the ration of dine-in v/s delivery remains the same,” he adds. But after the market of these aggregators in the initial 3-4 years they really helped restaurant brands to scale. With the aggregator business the pie has really grown while it has become a level-playing field for a lot of newer competitions and customers to get better access to ordering and everything, the per centage of delivery has really grown. “In the last two years we have seen more people logging in online and from different age group. It is the new ease and comfort that people are getting use to,” he further explains.
Getting Friend zoned: “We don’t mind having more access point to customers because that’s what matters. With aggregators coming into the food category, customers have extra incremental touch, access points,” adds Prashant Gaur, CBO, Pizza Hut India who believes that you only make your brand available to the largest set of people who would have probably otherwise not come to you through these online aggregators. That’s the way these brands look at this entire ecosystem. “When I go back to 2013-14 at my initial days with QSRs at Domino’s we guys felt that food aggregators are our enemy. Later, we realized that more and more customers are able to order online which is incremental to the business and they are not our enemy. And, now we have reached the stage where we fairly believe that if you have set the ground rule right, you know how to work with them in a more collaborative and defined way they will be your friends,” he shares laughing.
How Incremental were Aggregators: “We have always been in the aggregator era as our brand started with the same bang. Zomato and Swiggy are doing more than a million orders a day which is huge. So, definitely the whole food delivery segment, the kind of service they have given, more and more consumers look forward if the food can be delivered at home,” points Vishal Jindal, Co-Founder, Biryani by Kilo. There’s no denying that they are a big part of the business. Going forward, if we look at China the online food delivery is huge there and same is going to happen in India.
Comparing the bottom line growth: The bottom line growth is not just the factor of aggregator fees and how much you have to spend on advertising. It is about how much we have evolved in last five years in other operational efficiencies. “I think it’s the same. We work on certain target or numbers and everything passed back on the customer. So, if we make more into something it will probably pass into pricing or would do a different offer or something like that,” adds Andrews who was very clear in the new era of aggregators where they have to dish out discounts, commission and distribution costs etc. And, we have been able to work on other operational costs like the kind of manpower we work, spaces we sign up, the procurement and the logistic costs etc. So, we have been able to afford the larger scale business that’s coming through these aggregators.
Hence, we can say that aggregating platforms area happy place for the customers because of the convenience of choosing from different options-but a challenge for restaurants to keep standing out.
