The Inside Scoop on Swiggy & Zomato

The growth in Online food delivery in India has been phenomenal – by some estimates it will grow 3X to USD 13 Billion by 2025. Indians love their food! and a traditional cook at home mindset is now evolving to significantly more dine out and order in.

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The online food delivery market is reigned over by the mightly Swiggy/Zomato duopoly. The space has grown, to a large extent, by high burn rates funded by large investment rounds. While the market potential is huge, the unit economics for both these companies would be worrisome to investors.

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Both companies standing in nearly USD 10 Billion valuations are still not profitable. However, the investor community has faith in the path that these companies and online food delivery market is on. Last year, Zomato had a highly successful IPO; Swiggy has recently raised USD 700 Million; and Zomato is now foraying into highly ambitious instant / quick deliveries.

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Now let’s come back to the main point– analysing the Vumonic data for undiscovered Swiggy/Zomato trends. It is clear from our analysis that the first COVID-19 lockdown was a boon for both players, and India has showered love on both Swiggy and Zomato almost equally.

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It is interesting to note that the Average Order Value (AOV) for both platforms is similar, approx Rs. 400. However the Average Orders Per User per month for Swiggy stands at 3.6 orders per month in 2021 and this is 12% higher than Zomato. So clearly Swiggy is finding more profitable users.

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So, currently Swiggy has a slight edge but we can see offshoots of a long term strategic play from Zomato. Both of these companies have great marketing departments, strong operations and empathetic leadership and are even poised to capitalise on India’s hunger!

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Keep watching this space for peeling off another layer in the evolution of the Food Delivery market in India.

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Blog written by : Anupam Asthana

Date: 13 Apr 2022

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Vumonic Datalabs is a global consumer intelligence platform. We provide high quality, deterministically linked, large structured data that can be used to derive deep consumer,  business and market insights. Our proprietary data pipelines deliver unbiased actual transaction data collected in a privacy secure manner via large global panels.

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