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Swiggy™, Foodora™, and Yelp™: Hyperlocal Platforms

Part of the Management for Professionals book series (MANAGPROF)

Abstract

The case on Siwggy, Foodora and Yelp analyses the hyperlocal food delivery business models that are popular in their respective markets. These multi-sided firms bring together local businesses such as restaurants and salons with their patrons through assistance in service discovery and delivery. This case elaborates how the foodtech space is evolving in countries such as India, Germany and the United States, and how each of these hyperlocal platforms are adopting different strategies to sustain their business in their primary markets. This case also looks at what threats these platforms pose to its different sides and how envelopment possibilities emerge. It highlights how a technology platform brings differentiation to the traditional food industry, and how a platform business model can provide significant competitive differentiation. By presenting three different hyperlocal platforms in as many geographies, the case study illustrates the commonality of business models while bringing forth the nuances of each market and its operational complexities.

This case is an extension of Chapter 5 Value Creation in Platforms.

Srinivasan R, Professor of Strategy, Sandeep Lakshmipathy Research Scholar, and Pramoth Joseph, Research Scholar prepared this case for class discussion. This case is not intended to serve as an endorsement, source of primary data, or to show effective or inefficient handling of decision or business processes.

Copyright © 2019 by the Indian Institute of Management Bangalore. Reproduced here with permission. No part of the publication may be reproduced or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise (including internet)—without the permission of Indian Institute of Management Bangalore.

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Fig. 6.1

Source Authors’ representation

Fig. 6.2

Source Authors’ representation

Exhibit 6.1

Source Delivery Hero—company portal. Available at: https://www.deliveryhero.com/wp-content/uploads/2017/05/Public-Company-Presentation-20170509.pdf

Exhibit 6.2

Source McKinsey & Company. Available at: https://www.mckinsey.com/industries/high-tech/our-insights/the-changing-market-for-food-delivery

Fig. 6.3

Source Authors’ representation

Exhibit 6.3

Source Yelp Inc.—Q1 2018 Shareholder Letter. Available at: http://www.yelp-ir.com/static-files/4c4c615f-5cbb-494c-8a84-9859a42766e5

Exhibit 6.4

Source McKinsey & Company. Available at: https://www.mckinsey.com/industries/high-tech/our-insights/the-changing-market-for-food-delivery

Notes

  1. 1.

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  2. 2.

    Lango, L. (2018) Valuation Is Starting to Become a Concern for GrubHub Inc Stock, Yahoo Finance. Available at: https://finance.yahoo.com/news/valuation-starting-become-concern-grubhub-220018888.html (Accessed: August 23, 2018).

  3. 3.

    Sayan Chakraborty (2017) Swiggy gets $80 million from Naspers and others, gains financial heft against Zomato—Livemint, LiveMint E-Paper. Available at: https://www.livemint.com/Companies/OvLqW673Z02PechgqA1fHP/Swiggy-raises-80-million-from-Naspers-others.html (Accessed: June 4, 2018).

  4. 4.

    Salman S H (2018) Swiggy raises $100 million from Naspers, others—Livemint, LiveMint E-Paper. Available at: https://www.livemint.com/Companies/91Lju0nx1z32mAmUZh2y6O/Swiggy-raises-100-million-from-Naspers-others.html (Accessed: June 4, 2018).

  5. 5.

    Anirban Sen (2018) Swiggy enters unicorn club with $210 million funding from Naspers, Livemint. Available at: https://www.livemint.com/Companies/AiJRVx5nIYGhuS5qSfZrHK/Swiggy-raises-210-million-in-fresh-funding-from-new-existi.html (Accessed: August 12, 2018).

  6. 6.

    Sarah Perez (2017) Google Areo is a new app for ordering food or home services in India, TechCrunch. Available at: https://techcrunch.com/2017/04/13/google-areo-is-a-new-app-for-ordering-food-or-home-services-in-india/ (Accessed: August 12, 2018).

  7. 7.

    ANI (2018) Swiggy expands footprints, launches operations in Nagpur, The Economic Times. Available at: https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/swiggy-expands-footprints-launches-operations-in-nagpur/articleshow/63938012.cms (Accessed: August 12, 2018).

  8. 8.

    Srinivasan, S. (2018) “Food delivery battle brews in cloud kitchen, Zomato makes first move,” The Economic Times, June 14 Available at: https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/food-delivery-battle-brews-in-cloud-kitchen-zomato-leads/articleshow/64580974.cms.

  9. 9.

    Salman S.H. (2017) Swiggy launches ‘Access’ kitchen for restaurant partners, Livemint. Available at: https://www.livemint.com/Companies/mgngNTra7jScvi0nzskqeK/Swiggy-launches-Access-kitchen-for-restaurant-partners.html (Accessed: August 12, 2018).

  10. 10.

    Payal Ganguly (2017) Swiggy sets up cloud kitchen “The Bowl Company” in Bengaluru, Times of India. Available at: https://timesofindia.indiatimes.com/companies/swiggy-sets-up-cloud-kitchen-the-bowl-company-in-bengaluru/articleshow/56659238.cms (Accessed: August 12, 2018).

  11. 11.

    Supraja Srinivasan (2018) Swiggy acquires on-demand delivery firm Scootsy for Rs 50 crore, The Economic Times. Available at: https://tech.economictimes.indiatimes.com/news/startups/swiggy-acquires-on-demand-delivery-firm-scootsy-for-rs-50-crore/65238251 (Accessed: August 12, 2018).

  12. 12.

    Varsha Bansal (2018) Swiggy, BigBasket discover next cash cow: Milk supply, The Economic Times. Available at: https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/swiggy-bigbasket-discover-next-cash-cow-milk-supply/articleshow/64377983.cms (Accessed: August 12, 2018).

  13. 13.

    Supraja Srinivasan (2017) Swiggy partners with Indifi Tech to launch financing program for restaurant partners, The Economic Times. Available at: https://tech.economictimes.indiatimes.com/news/internet/swiggy-partners-with-indifi-tech-to-launch-financing-program-for-restaurant-partners/61049835 (Accessed: August 12, 2018).

  14. 14.

    Supraja Srinivasan (2018) Swiggy follows Zomato’s steps, rolls out first paid subscription plan for users, The Economic Times. Available at: https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/swiggy-follows-zomatos-steps-rolls-out-first-paid-subscription-plan-for-users/articleshow/65201912.cms (Accessed: August 12, 2018).

  15. 15.

    Steve O’Hear (2016) Delivery Hero acquires Foodpanda as Rocket Internet shuffles online takeout pack once again, TechCrunch. Available at: https://techcrunch.com/2016/12/10/delivery-hero-captures-foodbanda/ (Accessed: August 23, 2018).

  16. 16.

    Delivery Hero Inc (2015) Delivery Hero acquires 100% of Foodora from Rocket Internet—The Easiest Way to Your Favorite Food. Available at: https://www.deliveryhero.com/delivery-hero-acquires-100-of-foodora-from-rocket-internet/ (Accessed: August 23, 2018).

  17. 17.

    Stefan Nicola (2016) Delivery Hero’s Foodora Expands as Rivalry Intensifies, Bloomberg. Available at: https://www.bloomberg.com/news/articles/2016-02-19/delivery-hero-s-foodora-expands-in-europe-as-rivalry-intensifies (Accessed: August 23, 2018).

  18. 18.

    Miltok (2016) Foodora—A digital revolution of the food delivery industry—Technology and Operations Management, HBS Digital Initiative Forum. Available at: https://rctom.hbs.org/submission/foodora-a-digital-revolution-of-the-food-delivery-industry/ (Accessed: 12 November 2018).

  19. 19.

    Vasagar, J. (2014) “Delivery Hero plans to use $88 m in internet takeaway push,” Financial Times, January 19. Available at: https://www.ft.com/content/801931ba-7f8e-11e3-b6a7-00144feabdc0.

  20. 20.

    Delivery Hero Inc. (2018) Delivery Hero—Company presentation. Available at: https://ir.deliveryhero.com/download/companies/delivery/Presentations/20180802_Company_Presentation_vf.pdf (Accessed: August 23, 2018).

  21. 21.

    Timetric (2018) Delivery Hero AG—Company Capsule. Available at: https://www.marketresearch.com/Timetric-v3917/Consumer-Goods-Retailing-c80/1.html (Accessed: August 23, 2018).

  22. 22.

    Wijngaarde, Y. et al. (2017) Food Delivery Tech: Battle for the European Consumer. Available at: https://blog.dealroom.co/wp-content/uploads/2017/10/Food-Tech-Prez-FINAL.pdf (Accessed: August 23, 2018).

  23. 23.

    Ahmed, M. (2016) “Just Eat, Delivery Hero and Takeaway.com fight for dominance,” Financial Times, January 1, Available at: https://www.ft.com/content/cfa6d3d8-a285-11e5-8d70-42b68cfae6e4 (Accessed: August 10, 2018).

  24. 24.

    Yelp (2018) Yelp Shareholder Letter. Available at: http://www.yelp-ir.com/static-files/4c4c615f-5cbb-494c-8a84-9859a42766e5 (Accessed: August 10, 2018).

  25. 25.

    Yelp Inc. (2017) Yelp Reports Fourth Quarter and Full Year 2017 Financial Results, Yelp. Available at: http://www.yelp-ir.com/news-releases/news-release-details/yelp-reports-fourth-quarter-and-full-year-2017-financial-results (Accessed: August 15, 2018).

  26. 26.

    Richard Lawler (2015) Amazon Echo links with Yelp to find info on local restaurants, Engadget. Available at: https://www.engadget.com/2015/10/24/amazon-echo-links-with-yelp-to-find-info-on-local-restaurants/ (Accessed: August 14, 2018).

  27. 27.

    Trefis Team (2012) Apple Shows Yelp Some Siri-ous Love, Forbes. Available at: https://www.forbes.com/sites/greatspeculations/2012/03/23/apple-shows-yelp-some-siri-ous-love-sends-it-more-traffic/-d4652194ea86 (Accessed: August 14, 2018).

  28. 28.

    Joshua Brustein (2017) GrubHub Buys Yelp’s Eat24 for $288 Million, Bloomberg. Available at: https://www.bloomberg.com/news/articles/2017-08-03/grubhub-buys-yelp-s-eat24-for-288-million (Accessed: August 15, 2018).

  29. 29.

    Ahuja, A. and Sen, A. (2018) “Swiggy, Zomato hike delivery boy salaries as competition grows,” LiveMint E-Paper, 26 July. Available at: https://www.livemint.com/Companies/cYbdfsYk93HFhMuC0XgaNN/Swiggy-Zomato-hike-delivery-boy-salaries-as-competition-gro.html.

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Srinivasan, R. (2021). Swiggy™, Foodora™, and Yelp™: Hyperlocal Platforms. In: Platform Business Models. Management for Professionals. Springer, Singapore. https://doi.org/10.1007/978-981-16-2838-2_6

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