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Acquisitions and Diversification of Zomato (2017-
2020) During the period from 2017 to 2020, Zomato underwent significant strategic expansions and acquisitions aimed at solidifying its position in the competitive food services industry. This period marked a crucial phase in Zomato's evolution, characterized by strategic acquisitions, diversification into new verticals, and the introduction of innovative subscription services.
Acquisitions: Zomato strategically acquired several startups between 2017 and 2020 to enhance its service offerings and expand its market presence:
1. Runnr: In 2017, Zomato acquired Runnr, a food delivery startup based in India. This acquisition allowed Zomato to strengthen its logistics and delivery capabilities, crucial for scaling its food delivery operations amidst growing competition.
2. Foodchimp: Acquired in 2018, Foodchimp was another significant addition to Zomato's portfolio. This acquisition aimed to enhance Zomato's technology stack and operational efficiency in the food delivery segment, thereby improving customer experience and service reliability.
3. TongueStun: Also in 2018, Zomato acquired TongueStun, a Bengaluru-based startup specializing in
corporate catering services. This acquisition enabled Zomato to tap into the lucrative corporate food services market, offering tailored solutions for office meals and catering.
Expansion into New Verticals:
During this period, Zomato diversified its business beyond traditional restaurant listings and food delivery, expanding into new verticals to capture broader segments of the market: 1. Food Delivery: Building on its acquisitions, Zomato intensified its focus on food delivery services, leveraging its enhanced logistics capabilities from the Runnr acquisition to compete more effectively with established players.
2.Events: Zomato ventured into event management, organizing and promoting food-related events to engage users and create additional revenue streams beyond its core offerings.
3. Loyalty Programs: Recognizing the importance of customer retention, Zomato introduced loyalty programs to incentivize repeat orders and enhance user engagement. These programs offered discounts, exclusive deals, and rewards points for frequent users.
Introduction of Zomato Gold:
A pivotal move in Zomato's strategy was the introduction of Zomato Gold in 2017. Zomato Gold revolutionized the dining experience by offering a subscription-based service that provided members with exclusive privileges such as complimentary dishes and drinks at partner restaurants. This initiative not only attracted a loyal customer base but also strengthened partnerships with restaurants, driving higher footfall and revenue.
The period from 2017 to 2020 marked a transformative phase for Zomato, characterized by strategic acquisitions, diversification into new verticals like food delivery and events, and the successful launch of Zomato Gold. These initiatives not only expanded Zomato's service portfolio but also reinforced its market position as a leader in the food services industry. Looking ahead, Zomato continues to innovate and expand, aiming to sustain its growth momentum and deliver enhanced value to customers and stakeholders alike.
Zomato: IPO and Beyond (2020-Present):
Zomato marked a significant milestone in its corporate journey by going public with a successful Initial Public Offering (IPO) in July 2021. This move not only solidified its market position but also demonstrated investor confidence in its business model and future growth potential. The IPO was met with tremendous enthusiasm, with the company's shares being oversubscribed by multiple times, reflecting the robust demand for Zomato's stock. Post-IPO, Zomato has continued to expand and innovate, aligning its strategies towards sustainability and profitability. One of the significant steps in this direction has been the introduction of Zomato Pro. This premium subscription service offers customers exclusive discounts and benefits at partner restaurants, enhancing the user experience and fostering customer loyalty. Zomato Pro has been instrumental in driving user engagement and repeat usage, thereby contributing to the company's revenue growth.
In addition to Zomato Pro, the company launched Zomato Market, a service that facilitated the delivery of groceries and essential items. This initiative was particularly crucial during the COVID-19 pandemic, as it allowed Zomato to diversify its offerings and cater to the increased demand for online grocery delivery. The introduction of Zomato Market not only expanded Zomato's service portfolio but also positioned it as a versatile player in the food and essentials delivery market.
Zomato has also placed a strong emphasis on sustainability. The company has implemented various eco-friendly practices, such as promoting sustainable packaging and reducing carbon emissions through optimized delivery routes. These initiatives reflect Zomato's commitment to environmental responsibility and resonate well with the growing consumer preference for sustainable brands.
Financially, Zomato has been focusing on achieving profitability. Strategic cost management, improving operational efficiencies, and expanding high-margin revenue streams like Zomato Pro are key aspects of this approach. By balancing growth with profitability, Zomato aims to sustain its competitive edge in the highly dynamic food delivery industry.
In summary, Zomato's journey post-IPO has been marked by strategic expansion, innovative service offerings, and a commitment to sustainability and profitability. These efforts underscore Zomato's vision to be a leading player in the global food delivery and services market, while also making a positive impact on society and the environment.
