Restaurant industry body to soon launch new food delivery app to take on Zomato, Swiggy

KEY STORY

• Restaurant industry body NRAI may soon launch a new food delivery app to take on Zomato, Swiggy amid an escalating face-off between restaurants and these delivery aggregators over alleged deep discounting, data masking and violation of platform neutrality.

• According to a report in the Economic Times, the industry body has revived plans to launch the app within two months. “We are looking at a launch by August-September,” the publication quoted Anurag Katriar, president of National Restaurants Association of India (NRAI) as saying.

• NRAI represents more than 500,000 restaurants across the country. “We are in final stages of finalising details with an established tech partner to whom we are outsourcing the backend management.”

• The app, to be owned by NRAI and managed by an external partner, will offer discounts and loyalty to counter the private aggregators. “We are working on a single loyalty programme for members across India,” Katriar said.

• Consumers will not have to pay for the app unlike loyalty apps such as Zomato Gold, and they will have the flexibility to encash loyalty points at any restaurant for dine-ins, the financial daily mentioned.

• Popularity of food delivery apps like Zomato and Swiggy has increased drastically recently amid lockdowns imposed to restrict the spread of coronavirus as lakhs of consumers depended upon these players to get food delivered at their home.

• Zomato and Swiggy have notched record numbers during the lockdown months when the restaurant industry was entirely dependent on deliveries for survival. Yet, the industry is bleeding.

CONCLUSION

• “We now have an industry where profits have evaporated, restaurants are dying, and the valuations of delivery apps and a couple of well-run restaurant chains are soaring,” the ET report quoted as saying Jaspal Sabharwal, industry veteran and cofounder of TagTaste, a digital food data and insights platform.

• “Further, even at the height of their success, delivery apps aren’t making any money,” he said. NRAI was in discussions with tech partners last year for launching its own app only for deliveries, but many aspects needed to be finetuned at the time. Now, it is being fast tracked.