Study On Zomato
Study On Zomato
1
Associate Professor, SIBM Pune, Symbiosis International (Deemed University) (SIU), India
2
Professor, SIBM Pune, Symbiosis International (Deemed University) (SIU), India
3
Assistant Professor, SIBM Pune, Symbiosis International (Deemed University) (SIU), India
4
Associate Lecturer, Gedu College of Business Studies, Royal University of Bhutan, Gedu, Bhutan
ABSTRACT
The main purposes of this study are to provide a comprehensive relationship between consumer attitudes
toward online food ordering. This study adopted quantitative research with primary data collected through a
questionnaire with online food delivery platforms and customer based on their knowledge, attitudes,
perspectives, and needs of online food delivery services. In this research paper, the reserachers examined the
growth of food aggregator industry. Researchers also have examined the business model these companies
follow and its effect on the conventional restaurant business in India.
This study aims at the behaviour of customers towards online food delivery platforms that are fast changing
the food retailing landscape across India. Hence, the study focuses on exploring the drivers of consumer
behaviour towards online food delivery apps.
The study identifies a research model having seven independent variables and two dependent variables. The
independent variables comprise of, Control, Credibility, Convenience, Ease of Informativeness, Technology
Anxiety, need for Interaction and Pleasure. The dependent variables comprise of consumer satisfaction and
consumer intentions. Partial Least Squares (PLS) analysis using Smart PLS software is carried out to test the
significance of the model.
The outcome shows that factors like Convenience, Control, Technology Anxiety & Ease of Information
significantly affect Consumer Satisfaction, which in-tern significantly affect the Consumer Intentions, while
Convenience also significantly affect the Consumer Intentions.
Keywords: Food delivery platform; Credibility; Convenience; Informativeness; Technology Anxiety; PLS
4353
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
In the first decade of the 21st century, there has use of the internet and various technological apps
been a Paradigm shift in the Retail Industry. This is which would give flexibility, interactivity and
because internet based applications came into personalization. It has become a very useful tool for
existence, which has further helped in growing e- not only communication, entertainment but
retail industry considerably. The entire landscape of education as well as electronic trade (5).
retailing has changed from physical retailing to the
e-retailing industry. The second decade of the 21st In the food industry, online food delivery
century witnessed the use of smartphones by the platforms such as Swiggy, Zomato and Foodpanda
common people hence the M-shopping as the new have established themselves. They provide a
phenomena in online purchasing. It was possible complete food ordering and delivering solution
because of user-friendly mobile apps working with system. It provides a single window for ordering
the help of 4G / Wi-Fi technology. This phenomena from a wide range of hotels and restaurants, and they
of mobile retailing and use of smart technology has have their exclusive fleet of delivery personnel to
received a lot of attention from the researchers all pick up and deliver food to the customers. These
over the world (2) (3, 4). services are very popular with the millennial
population as it reduces the time and effort that is
spent on shopping (5).
2. LITERATURE REVIEW
The business model for food aggregator
As per the report of FICCI (2017), food (Refer Figure 1) is similar to taxi aggregators or
expenditure holds the largest retail consumption in hotel aggregators. The only difference in food
the ever-growing Indian society. Indian food aggregator is, they have a tie-up with many
services market in India (organised and unorganised) restaurants and food chain hotels who are willing to
is estimated to grow at the rate of 10% over the next provide food on demand. Food aggregator has a
five years to reach up to rupees 5,52, 000 crores (1). user-friendly mobile app and also has to provide for
physical logistics of the food. They employ delivery
Online food delivery industry has grown in executives with a condition of having two wheelers
India post-2010. This was possible because of the
4354
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
driving license and preferably owing two-wheelers 1. First and foremost is that they are less
for this purpose. expensive than the conventional service providers, in
fact, they give additional discounts for the repetitive
The business model for food aggregators customers; thereby making them accessible even to
like Swiggy, Zomato and Foodpanda work the middle & lower middle classes.
specifically on discount given to the consumer to
attract them. More of the consumers more is 2. They offer convenience to the consumers
business. They have tied up with a chain of by placing technology at the centre of it. The mobile
restaurants to provide food on request. These food app, connected the consumers (i.e. demand side)
aggregators have given a digital platform in the form with the restaurants (i.e. supply side). The food
of user-friendly mobile application which has aggregator app acts like a demand-supply matching
brought restaurants close to the consumers (6). mechanism that makes a profit by providing the
physical delivery of food. All they had to do is to tie-
2.1 The infancy stage (2014 - 2016) up with various restaurants & integrate them into the
system & customer would be in their system,
whenever they download the app (8).
The entry of food Tech startups around
2013 -14 brought the paradigm shift to the
operations of the Indian food industry. Everyone 3. They offer time flexibility; their services
thought that growing disposable income and are available whenever a consumer wants the order
increase in the young and working population & wherever he wants it. They also offer various
coupled with increasing internet penetration and payment options, including cashless payments or
rising smartphone users and events such as cricket cash on delivery options to choose from, whichever
IPL league would drive India's food-tech market. is suitable to consumer.
However, 2015 was a period of turmoil for them as
several startups had to shut down. The situation got 4. The food ordering mobile app is
better in 2017 as tech companies fine-tuned their equipped with real-time GPS based order tracking.
business model to suit the Indian customers (7). The consumer can track the delivery boy and help
him to find the exact address.
2.2 The consolidation stage (2017- 2019):
5. The mobile ordering app has loyalty
This consolidation phase saw many mergers and points to offer to consumers. This encourages the
acquisitions during this period. Two predominant consumer to frequently use the app & order with
models, restaurant marketplaces and cloud kitchen more discounts.
evolved during this time. This stage is also marked
by a reduction in delivery costs and increased 6. Customer support is available 24/7 to
penetration in the existing market (7). consumers to connect the executives in case of
complaints or to answer their queries (9).
2.3 Expansion & customization (2019,
onwards): The low-cost conditions, convenience and
flexibility, have been the biggest value creation for
The food tech industry saw a lot of investment these food aggregators.
during this time. The focus is now on expansion and
bringing personalization to retain repetitive The disadvantages of food aggregator are as follows.
consumers such as membership clubs, loyalty Many of the frequent buyers of food from delivery
programs. This also includes offering special app cited concern about the quality & hygiene of
concessions to customers’ birthdays & anniversaries food. This is especially when news of one of the
(7). delivery executive eating bytes of food ordered
while on the way to deliver got published. The
Food aggregators have the following company fired the delivery executive and offered to
distinct advantages of the conventional food service refund the money to the customer. As a
provider. countermeasure, these companies are now investing
a lot more in training their executives in soft skills
(10).
4355
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
Apps promote restaurants on their behalf. The technological advances in online food
So listing at the app is beneficial to restaurants as delivery system improve productivity & profitability
increases business, helps in brand building, & of the system. This has led the restaurants to grow
promotion increases customer base, and reduces cost the business from time to time (12).
(11).
4356
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
The researchers have considered the 6.Need for Interaction: Consumer finds a
following nine components for study. Therefore, the need for interaction through the mobile app, and the
following hypotheses are proposed personal attention of the restaurant employee is
important. This is the indirect interaction to the
1.Convenience: Convenience is the ease of person through Technology (15) (25).
use where consumer-initiates the transaction at his
convenient time from the comfort of home.
4357
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
H6. Need for interaction has a positive H9. Convenience has a positive
relationship with Consumer satisfaction toward relationship with consumer intentions.
online food delivery platforms
3. RESEARCH METHOD
7. Informativeness: The app can provide
food information and interesting information on the The current study applies a quantitative
product (26). It also refers to the degree of usability exploratory approach and analyze and explain the
and effectiveness of the information. The app can relationships among and between independent and
provide upgraded information which will help the dependent variables through hypothesis testing.
assistant consumer in making the decisions (15).
Based on the literature review, the
H7. Informativeness as information and conceptual model was suggested. An online
its effectiveness have a positive relationship with questionnaire was developed to capture the
consumer satisfaction towards online food responses of the consumer. The questionnaire was
delivery platforms. divided into two parts, in a first part the demographic
details of the respondents were captured (with ten
8.Satisfaction: It is the outcome of the questions such as Age, Education, Gender etc.) and
service of online ordering and the quality of the in second part questions based on the construct were
service that the consumer gates (27) (28). asked (with 11 questions). The 5 points Likert scale
was used from strongly disagree (1) through to
H8. Consumer satisfaction has a positive strongly agree (5) to capture the responses of the
relationship with consumer intention towards consumer. An online link was created of the
online food delivery platforms questionnaire using Google form & was
emailed/sent on what’s app groups. Since the subject
study was related to online food ordering, the
9.Consumer Intention: It is the
response also was taken using an online survey.
informational response which results from the
satisfaction which acts as the stimulus for the
recurring use of the app. The informational response The focus of the study was to understand
is a total of the components such as awareness, the online food shopping behaviour of the
interest, and desire converted into action. (29) (30). consumers. The respondents were asked to
remember online food mobile application, which
they had used while purchasing something from and
4358
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
while completing the entire questionnaire for that B. Preferred mode of payment
application. A set of 170 responses was found to be
complete and usable. The descriptive analysis was
carried out of the data. The qualified respondents
were current users of mobile online food shopping
(41% female, 51% below the age of 30, 92% with
post-graduation education).
4359
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
digital payment option, they would still prefer to pay if we have a more complex model where predictors
on cash after the food delivery. have more variables than observations. In the past
Covariance-based, SEM was more prominent.
4.1 PLS Measurement Analysis However, recent research supports the use of partial
least square SEM as it has many advantages as given
Recently, partial least square structural below (33).
modelling methodology has got acceptance from the
research community, especially in social science The PLS SEM approach is better than Co-
Consumer Consumer
Fornell-Larcker Criterion Control Convenience Infromation Technology
Intention Satisfaction
Consumer Intention 1.000
Consumer Satisfaction 0.713 1.000
Control 0.445 0.480 1.000
Convenience 0.508 0.493 0.436 1.000
Infromation 0.395 0.516 0.302 0.365 1.000
Technology 0.099 0.241 0.231 0.091 0.075 1.000
research (32). This is called a 2nd generation variance SEM approach where:
procedure because here Measurement (Outer model)
and Structural model (Inner Model) are analyzed 1. There are no distribution assumptions
simultaneously unlike in Co-variance based SEM, about the data set.
which is 1st generation statistical procedure.
4360
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
2. All numerical data were collected using It is the extent to which a measure correlates
Nominal, Ordinal Interval and Ratio positively with an alternative measure of the same
measures. construct.
3. Co-relation among the observed variable Since for each of the latent variable, there
4361
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
A structural (inner) model evaluation is done to see Table 2 shows a positive impact with a path
the role of the independent variable to the dependent coefficient of 0.234 with the p-value 0.005 (p<0.05).
variable in the model through R2 value and through Thus the null hypothesis is rejected, and the
Q2 value, which talks about predictive relevance of alternative hypothesis H1 is accepted. In conclusion,
the model. it can be stated that there is a statistically significant
and positive impact of the convenience on consumer
The table shows path Coefficients and their satisfaction. Further, it means that consumers used
‘t’ statistics. As shown in Table 2, hypotheses online food app because it is convenient for them to
Convenience & Consumer satisfaction, Control & order the food.
Consumer satisfaction, Informativeness &
Consumer satisfaction, and Convenience & H2. Perceived control of decision making
Consumer satisfaction are statistically significant. has a positive relationship with Consumer
The hypothesis Technology & Consumer satisfaction towards the online food delivery
satisfaction are statistically significant at the 10% platforms.
level.
Table 2 shows a positive impact with a Path
Other hypotheses like Credibility and coefficient of 0.185 with the p-value 0.044 (p<0.05).
Consumer satisfaction, Pleasure & Consumer Thus the null hypothesis is rejected and the
satisfaction, Interaction & Consumer satisfaction are alternative hypothesis H2 is accepted. In conclusion,
not statistically significant. it can be stated that perceived control has a
statistically significant and positive relationship with
The R2 value of the dependent variable in consumer satisfaction. It further means that the
the model shows how much independent variable consumer feels that they are in complete control and
can explain the variance of the dependent variable. charge while using the online food delivery app.
In the R2 table, the R2 value is 0.541 for consumer
intentions, and the R2 value is 0.447 for consumer H3: Credibility of reliability and quality
satisfaction shows that the independent variable has of information has a positive relationship with
a moderate effect on the dependent variable. consumer satisfaction towards online food
delivery platforms.
Geisser developed the Q2 test to access the
predictive relevance of the endogenous constructs. Table 2 shows a path coefficient of 0.127
This test is an indicator of how well-observed values and p-value of 0.204 (p>0.05). Thus the null
are reproduced by the model and its parameter hypothesis is accepted, which means that this
estimates. The Q2 value for consumer intention is relationship is not statistically significant. It further
0.502, and for consumer satisfaction is 0.382 shows means that the consumers are ready to experiment
that the model has got high predictive relevance (35). with and not worried about the credibility of the
(Refer to Table 3) information while using online food delivery app.
4362
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
H5. Pleasure as the feel-good factor has a satisfaction on consumer intentions of the use of
positive relationship with consumer satisfaction online food delivery app.
towards online food delivery platforms.
H9. Convenience has a positive
Table 2 shows a path coefficient of 0.112 relationship with consumer intentions.
and p-value of 0.207 (p>0.05). Thus the null
hypothesis is accepted, which means that this Table 2 shows a positive impact with a Path
relationship is not statistically significant. It further coefficient of 0.207 with the p-value 0.016 (p<0.05).
means that pleasure as a feel-good factor does not Thus the null hypothesis is rejected and the
affect the use of the online food delivery app. alternative hypothesis H9 is accepted. In conclusion,
it can be stated that convenience has a statistically
H6. Need for interaction has a positive significant and positive relationship with consumer
relationship with Consumer satisfaction toward intentions.
online food delivery platforms.
Table 3 shows consumer intentions with the
Table 2 shows a path coefficient of -0.024 R2 value of 0.541 and Q2 value of 0.502. This
and p-value of 0.776 (p>0.05). Thus the null concludes that convenience and consumer
hypothesis is accepted, which means that this satisfaction plays a very important role in consumer
relationship is not statistically significant. It further intentions, which results in frequent and repetitive
means that the need for interaction as a factor does use of the online food delivery app.
not affect the use of the online food delivery app.
6. CONCLUSION
It could be because of the frequency and
repeated use of the mobile app that has diminished The study shows that there is going to be a
the feel-good factor and the need for interaction. huge demand for mobile food delivery applications
in the coming future. People use mobile applications
H7. Informativeness as information and to deliver food to them not only because it saves on
its effectiveness have a positive relationship with time, but it is convenient. Also, they have a feeling
consumer satisfaction towards online food of control over technology as they can order food
delivery platforms. that they want, right at the place they want. Also,
people experienced the satisfaction of using mobile
Table 2 shows a positive impact with a Path technology and having the informativeness at the
coefficient of 0.235 with the p-value 0.017 (p<0.05). fingertips.
Thus the null hypothesis rejected and the alternative
hypothesis H7 accepted. In conclusion, it can be Technology is affecting business in almost
stated that informativeness has a statistically every sphere. The gap between consumer
significant and positive relationship with consumer expectations and their fulfilment is being reduced
satisfaction. It further means that the consumer feels with the help of Emerging Technologies. It is that
that they get quick and visual food information while disruptive force which has brought a Paradigm shift
using the online food delivery app. in the business model to serve customers in the
manner that was unthinkable before. In the last
H8. Consumer satisfaction has a positive decade, India has witnessed the exponential growth
relationship with the consumer intentions of in internet access as well as in the number of
online food delivery platforms. smartphone users. Technology convergence of
Mobile phones and internet access has caused
significant shifts in consumer awareness, outlook,
Table 2 shows a positive impact with a Path
expectations and their buying behaviour (7).
coefficient of 0.608 with the p-value 0.000 (p<0.05).
Thus the null hypothesis is rejected and the
alternative hypothesis H8 is accepted. In conclusion, Majority of the users (descriptive analysis
it can be stated that consumer satisfaction has a says that 51% were below the age of 30) are young
statistically significant and positive relationship with amongst the sample taken for study while this means
consumer intentions. The very high path coefficient that in future the consumer demand will grow and
shows that there is a strong effect of consumer with the outlook of this vibrant and young
population, it will undergo a big change in terms of
4363
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
4364
Journal of Theoretical and Applied Information Technology
31st August 2019. Vol.97. No 16
© 2005 – ongoing JATIT & LLS
Finance and Social Sciences (AP16Malaysia [27]. Shiau W-L, Luo MM. Factors affecting online
Conference; 2016. group buying intention and satisfaction: A social
[15]. Kimes SE. Customer perceptions of electronic exchange theory perspective. Computers in
food ordering. Cornell Hospitality Report. Human Behavior. 2012;28(6):2431-44.
2011;11(10):6-15. [28]. Zhou L, Dai L, Zhang D. Online shopping
[16]. Chavan V, Jadhav P, Korade S, Teli P. acceptance model-A critical survey of consumer
Implementing Customizable Online Food factors in online shopping. Journal of Electronic
Ordering System Using Web Based commerce research. 2007;8(1).
Application. International Journal of Innovative [29]. Belch GE. Belch., MA 2004. Advertising and
Science, Engineering & Technology. Promotion: An Integrated Marketing
2015;2(4):722-7. Communications Perspective. New York
[17]. Morganosky MA, Cude BJ. Consumer McGraw-Hill 連結. 2011.
response to online grocery shopping. [30]. Wen I. Factors affecting the online travel
International Journal of Retail & Distribution buying decision: a review. International Journal
Management. 2000;28(1):17-26. of Contemporary Hospitality Management.
[18]. Yeo VCS, Goh S-K, Rezaei S. Consumer 2009;21(6):752-65.
experiences, attitude and behavioral intention [31]. Cohen J. A power primer. Psychological
toward online food delivery (OFD) services. bulletin. 1992;112(1):155.
Journal of Retailing and Consumer Services. [32]. Ken Kwong-Kay W. TECHNICAL NOTE:
2017;35:150-62. Mediation analysis, categorical moderation
[19]. Korgaonkar P, Wolin LD. Web usage, analysis, and higher-order constructs modeling
sdvertising and shopping: relationship patterns. in Partial Least Squares Structural Equation
Internet Research. 2002;12(2):191-204. Modeling (PLS-SEM): A B2B Example using
[20]. Janda S, Trocchia PJ, Gwinner KP. Consumer SmartPLS. Marketing Bulletin. 2016;26:1-22.
perceptions of Internet retail service quality. [33]. Ali F, Rasoolimanesh SM, Sarstedt M, Ringle
International Journal of Service Industry CM, Ryu K. An assessment of the use of partial
Management. 2002;13(5):412-31. least squares structural equation modeling (PLS-
[21]. Rutsaert P, Regan Á, Pieniak Z, McConnon Á, SEM) in hospitality research. International
Moss A, Wall P, et al. The use of social media Journal of Contemporary Hospitality
in food risk and benefit communication. Trends Management. 2018;30(1):514-38.
in Food Science & Technology. 2013;30(1):84- [34]. Chin WW. How to write up and report PLS
91. analyses. Handbook of partial least squares:
[22]. Batra R, Ahtola OT. Measuring the hedonic Springer; 2010. p. 655-90.
and utilitarian sources of consumer attitudes. [35]. Chin WW. The partial least squares approach
Marketting Letters. 1991;2(2):159-70. to structural equation modeling. Modern
[23]. Overby JW, Lee E-J. The effects of utilitarian methods for business research.
and hedonic online shopping value on consumer 1998;295(2):295-336.
preference and intentions. Journal of Business [36]. Sarkar J. Food delivery apps score big in IPL
research. 2006;59(10-11):1160-6. Mumbai: The Economics Times; 2019
[24]. Bross A, Gender and information and
communication technologies (ICT) anxiety:
Male self-assurance and female hesitation.
Journal of Cyber Psychology & Behavior, 8(1),
21-31.
[25]. O'Brien HL, Toms EG. What is user
engagement? A conceptual framework for
defining user engagement with technology.
Journal of the American society for Information
Science and Technology. 2008;59(6):938-55.
[26]. Ducoffe RH. How consumer assess the value
of advertising? Journal of Current Issues &
Research in Advertising. 1995;17(1):1-18.
4365