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The Silicon Review Asia

Online food ordering gets expensive as biggest players raise costs

Online food ordering gets expensive as biggest players raise costs

The two biggest players, Swiggy and Zomato are now making it expensive for the consumers to order food online. Both the online food ordering giants have not just raised the delivery fees, but also reduced discounts and increased the prices of their loyalty programs.

In Bengaluru, Zomato added a delivery fee of INR 11 to its meal-for-one offering and a surge fees on orders during peak hours had been raised to INR 25. The delivery charge for meal-for-one offering was free earlier. Previously, Swiggy didn’t charge for orders beyond a certain amount, but now the delivery fees is INR 21 for deliveries of orders above INR 98.

Both the companies – Swiggy and Zomato – had tightened cancellation rules and order escalations. Strategies such as cross-selling at checkout stage of an order had been adopted by Zomato, so as to increase the order value by suggesting side offerings. A membership for three months in Swiggy’s loyalty program Super was INR 179 previously. The price has now gone up to INR 349. Similarly, Zomato’s loyalty program Zomato Gold had also hiked prices to over 80 percent from INR 999 to INR 1800 for a one year membership.

Reports from experts suggest that this year is going to be the year with the slowest growth that the industry had seen in the last five years. Increased costs and reduced discounts are the primary reasons responsible for this slow growth.

 

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