31 July, 2018
After Zomato began building a subscription-driven playbook to scale the food technology market, rival Swiggy has followed suit.
The Bengaluru-based food delivery firm has forayed into the paid subscription-based offerings space launching its first ever membership program called Swiggy Super.
A membership offering to alleviate delivery fees on the platform for a customer, Swiggy Super will offer users unlimited free deliveries across all 35,000 restaurants listed on the platform, irrespective of the distance or time of day. In addition, the membership program will ensure no surge fee for the user and a quicker resolution mechanism through a dedicated customer care team.
“Swiggy Super is the result of understanding some of (customers’) biggest pain points when it comes to food delivery and making it more convenient, affordable and simple,” said Anuj Rathi, Vice President of Product at Swiggy. “In the coming months, we will continue to bring more value through ‘Super’ by adding more benefits and growing the existing offerings on this service,” he added.
The loyalty program is currently priced between Rs 99-149 for a 1 month subscription and is also available as a 3 month subscription plan.
The initial phase of the program has been rolled out to over 2 lakh users, across 7 cities and will be formally launched for all users over the next three months. Swiggy Super will also offer subscribers exclusive offers from its restaurant and payment partners going forward.
For Swiggy, which has been spending heavily to gain market share in markets dominated by Zomato, it is losing about Rs 40 per delivery, according to people aware of the firm’s on-ground operations. Swiggy Super will not only aid in churning frequency of order volumes for the firm, currently at over 14 million per month, but also help in recovering some parts of the delivery cost thus borne, according to the people cited above.
Swiggy’s loyalty program comes at a time when the Gurgaon-based rival, Zomato, has been building a moat with a slew of subscription-based services, including the successful Gold offer. Zomato also offers Treats and the recently launched PiggyBank program to specifically aid customer stickiness and improve repeat purchases for its food delivery business.
At about 10.5 million orders per month as of June, Zomato counts over 4,00,000 paid subscribers for its Gold offering, about 2,50,000 for Treats with over 500,000 sign-ups for PiggyBank.
Subscription-based services and food delivery together have become the key revenue drivers for Zomato, now forming about 60% of its revenue pie. Until FY18, Zomato’s revenues were driven by its advertising business forming 75% of the pie in FY17. Revenues from the advertising business have come down to about 40% currently.