CHAPTER 1

INTRODUCTION
 INTRODUCTION

Online food delivery system is the process of ordering food through the Internet. In India, online
food ordering is growing day by day. Usually a customer search for a favourite restaurant or type of
dish and choose from the available items. A wide variety of food makes the user buy online. Online
food ordering system, users can give orders at any place and pay cash on delivery. The system deals
with ordering, processing and delivering food products. It is a simple and convenient way for
customers to buy food online without having to go to any restaurant. It is the internet that connects
the restaurant or the food company and the customer. This system of online food delivery is safe
and it is the most popular method nowadays. This method is developed to help restaurants to
simplify their daily operational and managerial task as well as improve the dining experience of
customers and also helps restaurants develop healthy relationship with customers. The format of
home delivery or the takeaways has gained a lot more customers in locations such as malls, offices
and big-party orders for residential complexes. People missing breakfast on the way to work, order-
in. People, who desire a better choice of corporate lunch or party, order in too. Everyone seems to
be in awe of the online food order and delivery option for the convenience and immediate source of
food at home. Besides, the convenience of ordering groceries from your mobile app or web browser
has certainly taken away some market share from the trusted ‘Kirana’ or the mom-and-pop stores.
India is the 6th largest grocery market in the world, but the organized sector as run by some of the
online businesses mentioned above makes up only 5-8% market share of the grocery business. The
vast majority is still owned by these local markets and mom-and-pop stores. This has some obvious
impacts on the brick-and-mortar formats of in-dining restaurants as more people prefer to have
restaurant-style cuisines right in the privacy of their homes or workplaces, but the impact is not so
much as it may appear to be. The fast food business in India is only about 2 decades old and remains
largely unorganized. Given the rate at which the organized sector is rapidly growing, it is only a
matter of time and a much larger chunk of global investments before a really big impact is made on
ongoing restaurant businesses that may not have a delivery-focused format of their own.

In today's digital age, the food delivery industry has witnessed an unprecedented boom,
transforming the way people order food. Two prominent players that have revolutionized the food
delivery landscape are Swiggy and Zomato. With their extensive reach, user-friendly platforms, and
enticing marketing strategies, Swiggy and Zomato have become the go-to choices for millions of
customers seeking convenient and delicious meals. This comparative study aims to delve into the
marketing strategies employed by both companies and analyze their effectiveness in capturing and
retaining customers.

The rapid growth of the food delivery industry has revolutionized the way people dine, providing
convenience and accessibility like never before. Swiggy and Zomato, two prominent players in this
market, have emerged as leaders, capturing a significant market share. Both companies employ
extensive marketing strategies to attract and retain customers, which makes studying their marketing
approaches essential for understanding their success.

The dramatic increase in the number of internet users in India along with a strong framework for
doing ease of business has eventually resulted in the emergence of new business sectors in the
country and therefore the focus of this paper will be on one such flourishing market inside the Indian
startup space i.e., the online food delivery business. Online food delivery is a service that allows
clients to order food online and have it delivered to their door. It involves technology that helps
restaurants to accept and manage online orders. While surfing the website from the comfort of their
own homes, Indian customers can choose from a vast choice of cuisines offered by various eateries.

Online food delivery businesses have emerged as a result of urban consumers' evolving buying
habits (Chai and Yat, 2019). Due to the rise in the working population and the time-constrained
work-life culture in metro areas, the idea of food delivery is swiftly growing (Das and Ghose, 2019).
In addition to this, the convenience the online food delivery businesses offer to their customers is
an important driving factor of growth for this industry as customers get all their food delivered with
a tap of a button within nearly 30 minutes.

The Indian online food delivery space is currently undergoing a revolution due to the heavy
investments that this industry has attracted in recent years. According to an article
(ResearchAndMarkets.Com, 2021), the Indian online food delivery industry will grow at a stunning
28.94 per cent CAGR from 2020 to 2026, hitting a market size of US $21.41 billion in 2026, up
from US $4.66 billion in 2020. This staggering growth in the online food delivery space in the
coming years will transform the way this business is done currently and thus bring a lot of
innovations in the industry. With more investments in this field, there will be new players who would
want to enter this market space and thus it is important to understand the factors critical to success
in the Indian market.

In India, currently, there are only two online food delivery companies namely Zomato and Swiggy
which dominate 95% of the market. Although these companies fundamentally provide the same
service to their customers, their app services differ in terms of features offered and customer value
systems (Raina et al.,2019). These differences in terms of app services and customer value systems
become a deciding factor for the customers to choose either of the delivery services. Therefore, the
current companies need to understand the factors that are critical to success in the Indian market and
thus improve their services accordingly to offer a better customer experience.

Although there have been researches which have identified the factors critical for success in the
food delivery business and also have made a comparison between players like Zomato and Swiggy.
But, none of the previously done research has focussed on the Indian market as a whole and therefore
there is limited literature about the Indian market. This paper will identify the factors that are
essential while operating for players in the online food industry and then shortlist the factors that
are most important to an Indian customer and should be a focus of new businesses entering the
industry with less capital and manpower. In addition, the paper will also identify the best player in
this industry by comparing the two companies Zomato and Swiggy based on the same set of factors.
This comparison will be done from an Indian consumer perspective by asking the opinion of
different consumers belonging to different cities.

1.1 DETAILS OF THE ORGANISATIONS UNDER STUDY

ZOMATO is an online food delivery and restaurant discovery platform. It was founded in 2008 by
Deepinder Goyal and Pankaj Chaddah. Originally launched as Foodiebay, it was later rebranded to
Zomato in 2010. Zomato provides a platform for users to search for restaurants, browse menus, read
reviews, and place food orders for delivery or pickup.
Users can access Zomato through its website or mobile app, which is available on iOS and Android
devices. The platform operates in numerous countries around the world and has a vast database of
restaurants and food establishments.

Zomato offers various features to enhance the user experience, including filters to search for specific
cuisines, locations, or restaurant types. Users can also view photos, menus, ratings, and reviews
from other customers to help them make informed decisions about where to dine or order food from.

In addition to its food delivery and restaurant discovery services, Zomato has expanded its offerings
to include table reservations, online ordering for groceries and other essentials, and even Zomato
Gold, a subscription-based program that provides exclusive discounts and offers at partner
restaurants.

Zomato has grown significantly over the years and has become one of the leading players in the
online food delivery industry. It has expanded its services through acquisitions and partnerships,
further strengthening its presence in different markets

SWIGGY is an online food ordering and delivery platform based in India. It allows users to order
food from a wide range of restaurants and delivers it to their doorstep. Swiggy was founded in 2014
and has since grown to become one of the leading food delivery platforms in India.

Using the Swiggy app or website, customers can browse through various restaurants in their locality,
explore menus, and place food orders. Swiggy offers a convenient and user-friendly interface that
allows customers to customize their orders, apply filters, and track their deliveries in real time.

Swiggy partners with numerous restaurants, cafes, and eateries to offer a diverse range of cuisine
options to its customers. It operates in several cities across India and has a vast network of delivery
executives who ensure timely and efficient delivery of orders.

In addition to food delivery, Swiggy also offers other services such as Swiggy POP (curated single-
serve meals at affordable prices), Swiggy SUPER (a subscription program that offers free deliveries
and other benefits), and Swiggy Daily (a subscription-based service for homestyle meals).
MARKET ANALYSIS OF SWIGGY

Market Presence:
Swiggy operates in the highly competitive online food delivery industry in India. It competes with
other major players like Zomato and Uber Eats as well as smaller regional players. Swiggy has
established a significant presence in several Indian cities and has been expanding its operations to
capture a larger market share.

Business Model:
Swiggy operates on an asset-light business model, acting as an intermediary between customers and
restaurants. It earns revenue through commissions charged to restaurants for every order placed
through the platform. In addition, Swiggy may charge delivery fees to customers

Competitive Landscape:
The online food delivery market in India is highly competitive, with multiple players vying for
market share. Swiggy faces tough competition from Zomato, which is its main rival. Other
competitors include Uber Eats , Foodpanda, and regional players like Dunzo and Box8. The
competition is driven by factors such as delivery speed, restaurant partnerships, customer
experience, and marketing efforts.

Market Growth and Opportunities:

The online food delivery market in India has witnessed significant growth in recent years, driven by
factors such as increasing smartphone penetration, convenience, and changing consumer
preferences. Swiggy has capitalized on this growth and expanded its operations to capture a larger
market share. The company has also ventured into new segments like grocery and essential
deliveries to diversify its revenue streams.

Challenges and Risks:

While there are growth opportunities, the online food delivery market also poses challenges and
risks for Swiggy. Some of the key challenges include maintaining profitability in a highly
competitive market, managing logistics and delivery operations efficiently, ensuring consistent
quality across a wide range of partner restaurants, and managing customer expectations regarding
delivery time and order accuracy.
 1.4 COMPARISON BETWEEN MARKET ANALYSIS OF SWIGGY &
ZOMATO

Market analysis involves studying the market dynamics, trends, and competition to understand
the potential opportunities and challenges for a company. Here's a comparison of the market
analysis for Swiggy and Zomato:

• Market Size and Growth:

Swiggy: Swiggy operates in the online food delivery market, which has experienced significant
growth in recent years. With a large customer base and a strong presence in major Indian cities,
Swiggy has captured a substantial share of the market.

Zomato: Zomato also operates in the online food delivery market and has been a key player
alongside Swiggy. It has a significant presence in major Indian cities and has expanded its services
to other countries as well. Zomato has been experiencing steady growth in terms of user base and
market reach.

• Competitive Landscape:
Swiggy: Swiggy faces intense competition in the online food delivery space. Apart from Zomato,
it competes with other players like Uber Eats, Foodpanda, and regional players. Swiggy has
focused on building a strong delivery network and technology-driven solutions to differentiate
itself from competitors.

Zomato: Zomato operates in a highly competitive market similar to Swiggy. It faces competition
from Swiggy, Uber Eats, and other local players. Zomato has positioned itself as a comprehensive
food discovery platform, which sets it apart from some of its competitors.

• User Base and Engagement:

Swiggy: Swiggy has a significant user base and a strong customer engagement model. It has
focused on providing a seamless user experience, quick deliveries, and a wide range of restaurant
options. Swiggy's loyalty program, Swiggy Super, has helped in retaining customers and driving
repeat orders.
 Zomato: Zomato also has a large user base and has built a strong community of food enthusiasts.
Its platform offers extensive restaurant listings, user reviews, and recommendations, which
enhances user engagement. Zomato's loyalty program, Zomato Pro, has been instrumental in
retaining customers and encouraging repeat orders.

• Expansion and Diversification:

Swiggy: Swiggy has expanded its services beyond food delivery. It has ventured into grocery
delivery (Swiggy Stores), medicine delivery (Swiggy Genie), and other hyperlocal services. This
diversification strategy allows Swiggy to tap into new market segments and increase its revenue
streams.

Zomato: Zomato has also expanded its services beyond food delivery. It has ventured into grocery
delivery, cloud kitchens, and dining-out experiences. Zomato's diversification strategy aims to
position itself as a comprehensive food services platform.

• Technology and Innovation:

Swiggy: Swiggy has heavily relied on technology to streamline its operations and enhance the user
experience. It has invested in developing its delivery fleet management system, AI-based
recommendations, and real-time order tracking features.

Zomato: Zomato has also leveraged technology to improve its platform. It has introduced features
like augmented reality (AR) menus, online table reservations, and chatbot-based customer support
to enhance the overall user experience.

1.5 RATIONALE
Zomato and Swiggy both have a collective market share of 95% in this sector, similar research about
comparative analysis of various food delivery companies based on consumer perspective have been
done for particular cities like Ludhiana, Pune and Rajkot. The results of these revealed that Zomato
was the leader in this market in the respective cities. To generalise the findings for a larger
population and determine whether Zomato continues to be the best for a wider range of populations
or not, I wanted to examine both Zomato and Swiggy in this study without limiting the sample to a
single city or state. Secondly, although there have been studies about determining the essential
factors to consumers in this industry, there is limited literature about this in India. Hence, my study
 will contribute to the literature by identifying the factors that are most crucial to an Indian consumer
while choosing a particular delivery service. This will help the upcoming businesses to capture the
market with less capital and manpower as they would be required to just focus on these crucial
factors in the beginning.

1.6 OBJECTIVES OF THE PROJECT

1. To determine the best company among Zomato & Swiggy in the Indian food delivery industry
through the 8 decision influencing factors from a customer standpoint.

2. To determine the most important decision-influencing factors for Indian Consumers when they
choose an online delivery service.

3 To determine whether there is any relationship between the degree of importance of these most
important factors and the type of city the customer belongs to.

1.7 STATEMENT OF PROBLEM

The Indian online food delivery business has been majorly dominated by two companies Zomato
and Swiggy. This oligopoly in the industry leaves the customers with limited options to choose from
and thus are forced to avail the services of only the two available businesses. In addition, this
domination by only two companies also reduces the number of innovations in the industry, thus once
again affecting consumer choice. Therefore, to battle this, the food delivery business space needs
more competitors who can give tough competition to the existing two companies and thus offer
customers choices and innovations. With this paper, we aim to take a step to provide a solution to
this problem by conducting a comparative analysis of the current two market leaders through the 8
decision-influencing factors from a consumer point of view and determine the best company in the
space. This will help companies such as Zomato & Swiggy to know about the areas among the 8
factors where the customer feels they lack and thus improve upon those. In addition to this, I will
also highlight the factors that Indian Consumers regard as most important in influencing their
decision to choose a particular service. This information will serve the upcoming businesses in the
online food delivery industry as they will know exactly what to focus on when they start. Since new
businesses often don't have the capital and manpower to focus on everything, my findings will help
them target a few factors to focus on and thus create a mark for themselves by capturing the market
while also keeping the customers satisfied. Lastly, I will also check whether the degree of
importance of these most important factors identified changes with the types of the city the
consumer resides in.

1.6 SCOPE OF THE STUDY

The scope of this study is that it will be limited to the sample age group of 18-60 and would be
distributed to people via email and other social media platforms. The total number of responses
targeted is just 147 from varied cities thus limiting the representation from each city. The factors
that have been chosen to put to test are the 8 decision influencing factors that are discussed in the
paper. The factors chosen are not an exhaustive list, however, the paper will continue with these 8
as they are very common and among the essential ones that have also been used in other research
papers outside India. The study focuses mainly on the businesses not having their food preparation
process or product but provides delivery services of food from restaurants to homes and offices
according to customers’ choice such as Zomato and Swiggy
 CHAPTER 2
LITERATURE REVIEW
 LITERATURE REVIEW

Pigatto et al. (2017) described online food delivery services as business platforms that offer order
services, payment options, and process monitoring but are not in control of food preparation.

Yeo et al. (2017) stated that two types of retailers offer food delivery services. The first is the
physical retailers. Fast food restaurants like Pizza Hut, McDonald's, Domino's Pizza, Kentucky
Fried Chicken (KFC), and others are the primary players in this area. The second category is made
up of numerous restaurant middlemen who offer delivery services for a wide variety of restaurants.

Chen and Hsieh (2017), online food ordering has become more popular as people's schedules
become busier and they have less time to cook or go out to eat.

Hirschberg et al. (2016), customers now have more convenience and choice due to online meal
delivery services, which enable them to place orders from a variety of restaurants with just a single
tap on their smartphone.

H.S. Sethu and Bhavya Saini (2016), looked into students' perceptions, behaviours, and satisfaction
with online food ordering and delivery services. According to their findings, internet food ordering
platforms assist students in better time management. It is also discovered that the convenience of
having their favourite cuisine available at any time and having simple access to the internet are the
primary reasons for using the services.
Khalifa (2004), in many marketing methods, the importance of consumer perception is heavily
utilised. It is crucial for every organisation's success and is regarded as a competitive advantage.

Yang and Jun (2002) stated that the online retail sector has gone through several phases so that it
can both retain and attract new clients. To foster client loyalty, it must offer good quality and good
service.

Zhilin (2002), a comprehensive consumer perception survey is crucial for providing better services.
In India, there have been several studies that have compared the various online food delivery service
providers based on consumer satisfaction; however, these studies are only conducted in one city,
making it difficult to generalise the findings across the country. In her study, Vithlani (2020) tried
to identify the food delivery application that built confidence in the minds of consumers. Customers
 who used both Zomato & Swiggy in Rajkot City were used as a sample for this study. Her research
based on polls and data analysis concluded that customers of Zomato are happier than those of
Swiggy.

Raina et al. (2019) used a sample of 162 persons from Ludhiana to identify which online food
delivery service is the most successful in the Indian city of Ludhiana. They discovered that Zomato
is the most popular online meal-ordering service in Ludhiana.

Jyotishman Das (2018) in his research, conducted only in the city of Pune with 153 respondents,
found out that Zomato was the first preference of customers followed by Swiggy.

J. Das (2018) performed a study in Pune on consumers' perceptions of online food ordering and
delivery services. According to the paper, Zomato has received a positive opinion from the majority
of users in comparison to other service providers such as Uber Eats, Food Panda, and Swiggy, and
this is mostly due to their improved on-time delivery and lower rates.
See-Kwong et al. (2017), customers' ability to pay for delivery fees is one of the factors holding
back restaurant business owners from outsourcing delivery to third-party internet delivery service
providers. Kedah et al. (2015) said that customer satisfaction is greatly influenced by the service
quality the online meal delivery services provide

Ahmed Tausif Saad (2020) conducted research in Bangladesh to determine the factors that affect
the online food delivery business in his country. He concluded that 8 factors affect the business the
most and these are Price, Service Quality, Attitude of Delivery Person, Variety of Restaurants,
Delivery Time, Condition of Food, Online Promotions and Delivery Tracking.

REASONS WHY I CHOOSE THIS TOPIC :

There are several reasons why studying the comparative study of Swiggy and Zomato can be
beneficial. Here are some key points:

• Market Analysis: Studying Swiggy and Zomato allows you to conduct a detailed analysis of the
food delivery market. You can examine their strategies, business models, and market shares. This
analysis can provide valuable insights into the dynamics of the industry and help you understand
 the factors that contribute to their success or challenges.

• Competitive Advantage: By comparing Swiggy and Zomato, you can identify their unique
strengths and weaknesses. This analysis can shed light on the competitive advantage each platform
holds over the other. Understanding these factors can be crucial for entrepreneurs or investors
looking to enter the food delivery space or for existing companies aiming to improve their
operations.

• Consumer Behavior: The comparative study allows you to explore the preferences and behaviour
of consumers who use Swiggy and Zomato. By examining their ordering patterns, delivery
experience, reviews, and overall satisfaction, you can gain insights into consumer expectations,
trends, and areas for improvement. This knowledge can be valuable for businesses aiming to
enhance their service and cater better to customer needs.

• Business Strategies: Both Swiggy and Zomato have employed different strategies to expand their
market presence and gain a competitive edge. By studying their approaches to customer
acquisition, partnerships with restaurants, delivery logistics, and revenue models, you can gain
insights into effective business strategies in the food delivery domain. This knowledge can be
valuable for entrepreneurs, marketers, and business leaders in various sectors.

• Global Implications: Swiggy and Zomato are not limited to a single country. Their presence
extends to multiple markets across the globe. Studying their comparative analysis can provide
insights into the challenges and opportunities of operating in different countries with diverse
consumer preferences, regulatory environments, and competitive landscapes. This knowledge can
be particularly relevant for businesses planning international expansions or partners
 CHAPTER 3
RESEARCH METHODOLOGY
 RESEARCH METHODOLOGY

Research methodology is a process used to collect information and data to make decisions. The
methodology may include publication research, interviews, surveys and other research
techniques.

3.1 IMPORTANCE OF RESEARCH METHODOLOGY

➢ Research methodology gives research legitimacy and provides scientifically sound findings. It
provides a detailed plan that helps to keep researchers on track, making the process smooth,
effective, and manageable.
➢ A researcher's methodology allows the reader to understand the approach and methods used to
reach conclusions.
➢ Having a sound research methodology in place allows other researchers to replicate the research
and explain their approach in case of criticism.
➢ The methodology design process helps researchers select the correct methods for the objectives
and provides them with a specific plan to follow throughout their research.
➢ The research methodology allows researchers to document what they intend to achieve with the
research from the outset.

3.2 RESEARCH DESIGN

Research design is the overall plan or structure that guides the collection and analysis of data for
a research study. It outlines the procedures and methods that will be used to gather and analyse
data in a way that is both relevant to the research purpose and efficient in terms of time, effort
and resources. The research design is like a blueprint that guides the entire research process from
start to finish, including the selection of research methods, data collection techniques, data
analysis procedures, and the interpretation of results. A well-designed research plan can help
ensure that the study is rigorous, and valid, and produces reliable findings that can contribute to
the broader knowledge base in the field. The Research measure the impact of marketing strategies
on the customer
3.3 RESEARCH OBJECTIVES:

The primary objectives of this project report are as follows:

a) To analyze the marketing strategies of Swiggy and Zomato, including their advertising
campaigns, brand positioning, and target audience identification.

b) To compare the promotional activities and offers provided by Swiggy and Zomato to attract and
retain customers.

c) To examine the digital marketing techniques employed by both companies, including social
media engagement, influencer collaborations, and online reputation management.

d) To assess the effectiveness of customer engagement initiatives such as loyalty programs,

feedback mechanisms, and personalized marketing campaigns.

e) To identify the key factors contributing to the success of Swiggy and Zomato in the competitive
food delivery industry.

3.4 RESEARCH GAPS

As it was evident from the literature review, previous studies in India have focused solely on
consumer perceptions from a single city, making it difficult to extrapolate the findings for a wider
range of populations. As a result, to fill this need, this study will not limit itself to customers from a
specific city, but will instead collect responses from consumers from varied cities. This would aid
in generalising the findings from the sample to a wider range of populations and drawing meaningful
conclusions from it.

3.5 DATA COLLECTION

The sources of information for this research are both primary as well as secondary data.

PRIMARY DATA :

It refers to data that are collected directly from sources for a specific research purpose. Primary
data can be collected through various methods such as surveys, interviews, observation and focus
groups. It is original because these are collected by the investigator for the first time. It is in the
form of raw materials.
The primary data has been collected by conducting an online survey through the Google Forms
platform. The entire survey has a total of 12 close-ended questions.

SECONDARY DATA:

It refers to data that have already been collected by someone else for a different purpose, but which
can be used by researchers for their studies. Secondary data can be obtained from a wide range of
sources, such as Company annual reports, websites and research reports These are not original
because someone else has collected these for his purpose
The secondary data were collected from various published sources such as:
1. Books
2. Journals
3. Magazines
4. Internet
5. Newspaper
6. Research Paper

3.6 TOOLS USED FOR ANALYSIS

A Major tools used for analysis process has been graphs and charts for interpreting the data
collected.