Business

Zomato falters at a crucial time as a controversial video goes viral

Zomato is a company which has been on the rise since its inception in the earlier years of this decade. It started off as a restaurant finder. A simple idea turned into profit by two Delhi residents. People took to Zomato like ducks to water. The concept was loved and the restaurant finder started to do reviews as well. Years into this business the company decided to enter the food delivery business a year later Swiggy started off.

However, it had the advantage of being in the food business for years before Swiggy even existed. Its growth pattern raised many eyebrows and gave Swiggy the nightmares of their own. That said, Zomato and Swiggy weren’t the only companies in this business then. There were companies like TinyOwl, Spoonjoy, EatOnGO, and Eatlo which were in the running as well. But as they say, only the fittest survive, Zomato and Swiggy were the only players left by the start of 2017.

Halfway through 2017, Uber, a major ride-hailing company entered the food delivery business. They came with an aggressive strategy and have been able to sustain it for a long period of time. They have managed to tail Zomato within a year and a half. Although they were pretty late to this party, they used their resources well and have been growing rapidly. In fact, if they continue to grow at this pace they will overtake Zomato for the second spot.

Another headache for Zomato arrived months after UberEats entered the market. Ola bought Foodpanda an already established company to mark its entry into the food business. Foodpanda was not doing well until Ola took over. It ran into logistics problems. They were also accused of fake listings and the delivery tampering.

That said, Foodpanda and UberEats have been giving Zomato a hard time up late. Swiggy is currently in their own league with being first for a long time. Swiggy reaches up to 20 million orders a month while Zomato sits pretty with 14 million orders. This is huge compared to UberEats and Foodpanda. However, the growth rates of both the entities are much larger in percentage than Zomato. Zomato’s growth has been stagnant for the past year. This has put Zomato under a lot of pressure.

In this hard time, Zomato has another controversy at their hands to tackle. A video, not more than a day ago went viral on all social media platforms. The video showcased a man wearing a Zomato t-shirt eating food from the packages he was supposed to deliver. He ate a small amount from every package before repacking it and moving on.

After a lengthy investigation, the video was revealed to be from Madurai. Zomato has also blogged about this apologizing to its users. The company said that it takes such kind of offenses very seriously and have fired the man responsible. They also confirmed that he was from one of their own delivery fleets. They even interviewed the person and came to the conclusion that it was a ‘human error in judgment’.

Such controversies can harm the reputation of a company and it will surely be a setback for Zomato. This also comes at a very crucial time when other platforms are looking for a mistake to overtake each other.

– Unmesh Phule

 

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