Zomato CEO Deepinder Goyal makes big disclosure on discounts - they only “appear” to be big

Those of you who order your food regularly through food delivery services like Zomato would be familiar with the big discounts on the platform. On general days, Zomato gives anywhere between 20 to 50 percent discount, which goes as high as 60 percent during festivals and on special occasions. Many even pick their preferred restaurant based on these discounts. However, in a huge revelation, Zomato CEO Deepinder Goyal has said that these discounts only "appear" to be big, instead of really being so.

Goyal appeared on YouTuber Ranveer Allahbadia’s podcast recently. The conversations went over topics such as the workings of the company, the work culture at Zomato, the hiring process for employees, competition with Swiggy, and more. During the conversation, the CEO also touched upon the lucrative discounts given by the company, and there is a twist in them.

Zomato offers only “appear” to be big

Allahbadia praised Goyal about the big discounts given by the company on a regular basis, and asked him how the company manages to turn a profit despite offering these offers. Candidly, Goyal said, “The discounts are not very big, they only appear so”, as per a report by Moneycontrol.

He also offered an explanation. When Zomato offers a percentage discount, it is usually supplemented with an upper ceiling of money. For example, 50 percent off up to Rs. 80. This essentially means that customers will get 50 percent off on their order value which is capped at Rs. 80. So, if your order is above Rs. 160, and something like Rs. 500, you’re not getting Rs. 250 off, but only Rs. 80.

He also confessed that offers like these are not exactly honest and can be considered misleading. Goyal explained that he wants to move away from such deceptive lures, but is unable to do so because of the rivals who also implement similar tactics.

“I don’t call this discounting honest. Discounting should be honest. If you’re telling your customer something, it should be honest. It should be 80 rupees off. It should not be 50% off up to ₹80. But if the competition continues doing this, I will not be able to change anything,” said Goyal.