Zomato climbs into India’s top 25 brands as it delivers a lifestyle brand

Mumbai: Zomato, once a simple curator of restaurant menus, has emerged among India’s top consumer brands, with its value rising 69% from the previous year and becoming the 21st most valuable brand in the country, according to consumer research firm Kantar. With a projected 2025 brand value of over $6 billion, excluding its flash commerce arm Blinkit, it now sits ahead of legacy names like Maggi, Bajaj Auto, Surf Excel and Paytm, reflecting its shift from a food delivery app to a broader lifestyle platform.

According to Kantar’s ‘BrandZ’ report published on Wednesday, Zomato showed the fastest increase in brand value this year, rising to the top of Kantar’s list of India’s 100 most valuable brands. What has helped is its transformation from just a food delivery app to a lifestyle brand, especially with the launch of “take out” app District by Zomato.

“This [valuation] excludes “Blinkit is clearly a fast delivery offering focused on consumer products,” said Soumya Mohanty, Kantar’s general manager and chief solutions officer for South Asia. “They are pushing events in the region. The main app is also active with people-centric customizations like veg mode, protein indicators, etc. These functions are part of the consumer’s lifestyle. People go to concerts, which is a recreational lifestyle choice, and so is ordering.”

Zomato’s rival Swiggy also made it to the list but was ranked 27th; brand value increased by a relatively modest 4% annually to $4.8 billion. However, this growth was slower than the 6% increase in the total brand value of India’s top 100 brands to more than $523.5 billion, according to Kantar estimates.

HDFC Bank, IT firm TCS and telecommunications company Airtel remained India’s top 3 brands in terms of value. Zepto, the new kid in gig commerce, also made its debut, but at a much lower point of 83, with an estimated brand value of $1.47 billion.

Other companies whose brand value increased this year included travel and experiences-related companies such as Taj Hotels, up 55% to $2.8 billion, Indigo Airlines, up 42% to $5.1 billion, and online travel aggregator MakeMyTrip, up 45% to $2.45 billion.

However, financial services and technology/service platforms accounted for 28% and 21% respectively of the total brand value of the top 100 brands this year, while FMCG and retail accounted for 8%, while consumer technology and travel services accounted for 4% and 2% respectively.

Kantar estimates the value of a brand by multiplying the financial value of that brand by the brand contribution. It defines ‘financial value’ as the proportion of the brand’s parent firm’s total value in US dollars attributable to the brand, and ‘brand contribution’ as the financial value created by the brand’s ability to buy more and command a premium.

The firm interviewed 4.5 million consumers and examined 22,000 brands operating in 538 categories in 54 markets.

K-Shaped rescue

Kantar’s report said FMCG brands are struggling with slowing urban demand as consumers change the way they spend.

“One problem is shifting priorities: affluent consumers in particular have recently reduced their share of wallet on essentials such as groceries and dairy, while interest in luxury cars, smartphones, home décor, clothes and watches has increased,” the report said, adding that rural households continue to associate value with branded, packaged goods but their budgets have been squeezed by years of high inflation.

But while middle-class Indians are driving brand value growth, consumer spending is also under the most stress as the economy continues on its post-pandemic ‘K-shaped’ trajectory, with wealthy Indians leaving the middle class behind, Kantar warns.

“Everywhere you look in the business press you see signs of this ‘softening middle’. FMCG sales are shifting towards more unbranded products. Swing trading startups are not making profits as quickly as they hoped. “Consumer banks appear to be signing up less for savings accounts, while unsecured loans are on the rise,” the report said.