Zomato Gold, the paid subscription product from Zomato, which allows users to get complimentary food or drinks at around 1200 restaurants in Delhi, Bangalore and Mumbai, has crossed 26000 subscribers*, just around seven-eight hours since launch, as per MediaNama estimates. Zomato says it plans to expand this to other cities as well. The service was first introduced in UAE (Dubai, Abu Dhabi), and Portugal (Lisbon and Porto), earlier this year. Other restaurant subscription offerings include the Coup Card, which we had covered a few years ago, which was more of a discount card. This is Zomato’s second subscription service: Zomato Treats, the company told Mint, has over 60,000 subscribers.
How Zomato Gold works
Zomato gold allows a customer, depending on the restaurant, a complimentary food item of the same or lower value as the food item ordered, or 2 complimentary drinks for every 2 drinks ordered. The complimentary drink will be the same as what has been ordered, and is not applicable to pitchers, buckets and full bottles. The food offer is not valid on special menu’s, thali’s, buffets and set menus. Note that there must be at least two people on the table to avail Gold benefits, and that Zomato Gold is not valid on Valentine’s Day, Christmas Eve/Day, New Years Eve/Day. It’s also not valid on home delivery or take-away, and cannot be clubbed with other discounts or offers.
Note that as per Zomato’s terms and conditions, it has taken rights to auto-renew the subscription, taking authorisation to “debit your payment method linked to the Zomato platform”.
Estimating Zomato Gold subscribers
Note that we have estimated subscribers on the basis of the displayed subscription limit, minus the displayed subscriptions remaining (for the introductory price). For example, at the time of writing this, Zomato Gold’s subscription page says that “Only 3141 of the 30,000 memberships remaining at this price”. This indicates that the number of subscribers are 26,859.
In less than a quarter of the day, Zomato increased the subscription limit for its discounted launch price (Rs 299 for a quarter, and Rs 999 per year) three times: starting with a limit of 10000 subscribers for the introductory price, it first increased the limit to 20,000 a little after 7pm in the evening, upon crossing the 10,000 mark. It then increased the number to 30,000 at around 9PM. One part which may have contributed to the viral growth is the fact that Zomato is offering 1 month extra to users for each referral they get, and anyone who signs up with a referral code gets 25% off. I tweeted a referral code to a former colleague, and shared it with a few others: now I have a 20 month subscription instead of a 12 month subscription I bought.
As per our observations, Zomato was averaging around 40-60 subscriptions per minute, although occasionally, the number of subscriptions per minute seemed to go above 100. Note that this is just an observation and an estimate, based on refreshing the Zomato page every few minutes today.
If you do the math, the cash earned by Zomato (if you exclude the discount earned via referrals) will be between Rs 80 lakh to Rs 2.7 crores. More likely, it will be around the Rs 1.27 to Rs 1.74 crores range. Our calculations:
- 100% subscribers paying Rs 299 + 0% subscribers paying Rs 999 = Rs 80,30,841
- 75% subscribers paying Rs 299 + 25% subscribers paying Rs 999 = Rs 1,27,31,166
- 50% subscribers paying Rs 299 + 50% subscribers paying Rs 999 = Rs 1,74,31,491
- 25% subscribers paying Rs 299 + 75% subscribers paying Rs 999 = Rs 2,21,31,816
- 0% subscribers paying Rs 299 + 100% subscribers paying Rs 999 = Rs 2,68,32,141
Note that while Zomato may have received cash upfront, this is money for subscriptions ranging from 3 months to much more: like mine, which is 20 months. However, there’s no arguing with the following statement:
cashflow > revenue
— Deepinder Goyal (@deepigoyal) November 14, 2017