Swiggy vs Zomato: Deepinder Goyal explains why his company fell behind, ‘When your own friends…’
Zomato founder Deepinder Goyal, in a recent podcast with Raj Shamani, talked about why rival delivery platform Swiggy was ahead of his company and how he took steps to recoup losses.
Founded in 2014, Swiggy quickly became a household name by disrupting India’s delivery market by providing food delivery from hundreds of restaurants under a single umbrella, thus eliminating the need for the customer to call the restaurant every time they want to pick up their own food or want food delivery.
On the other hand, Zomato, which has existed as a restaurant discovery platform since 2008, started to lose its edge as delivery became the new ‘cool’ business, especially with the discounts Swiggy provided in its early days.
When asked what Swiggy did right that Zomato did not, Deepinder Goyal replied: “I think it was food delivery logistics. In fact, they started it. I had been resisting for a few years thinking that this model would never make money.”
Justifying the reason behind his opinion, the Zomato founder said that he thinks Swiggy’s “economics are very bad”.
“At that time it was very difficult to justify that it would make money. I’m sure even the founder of Swiggy didn’t know if it would make money or not. But the customer love was real. So at one point there was no option for us but to do it,” said Deepinder Goyal.
He said Swiggy’s customer retention proves their love for the platform.
“When your friends say, ‘I’m not ordering from Zomato anymore, I’ll do it from Swiggy,’ you know you have a problem on your hands. Then we had to solve it,” Goyal said in the four-hour podcast.
Shark Tank controversy with Swiggy
Deepinder Goyal also touched on the recent controversy surrounding Shark Tank, where he came on as a judge for one season and was allegedly removed from the next season due to objection from Swiggy, the sponsor of the show.
“I heard about it from the Shark Tank crew. They were talking to me about next season and I was thinking I could do it on a weekend like last time. And then we were still talking.”
But things suddenly took a turn after that, and Shark Tank’s creators “backed off,” Goyal said.
“They called us a day later and said they couldn’t do it. And I said, ‘This is great, why are you buying it?’ I said.”
The Zomato CEO later revealed that he was told that he had raised issues with Swiggy’s presence on the show. “They told us we couldn’t take you.”
