India's online food delivery segment still in nascent stage: JustEat CEO Ritesh Dwivedy

We interact with India's online food ordering giant Just-Eat's Founder-CEO Ritesh Dwivedy.

Published Date
14 - Feb - 2014
| Last Updated
14 - Feb - 2014
 
India's online food delivery segment still in nascent stage: Just...

Online food delivery is among the fastest growing segments in the e-commerce space. Just Eat has been in the Indian market for quite some time and is one of the largest brands in this segment. We had an opportunity to interact with Mr. Ritesh Dwivedy, Founder/CEO justeat.in, and and get an idea about the current state of the online food business, the challenges and the future plans.

JustEat.in has been in the business for quite a long time. How has been the journey so far?

The entire journey so far from HungryZone to JustEat has been difficult at times but very enriching. We began in 2006, with a mere 15 restaurants on board, as India’s first online food ordering portal. And now we’re India’s largest online food ordering portal and table reservation website with over 2500 restaurants, 52 cuisines and 3 lakh dishes to choose from! The entire ride from being the pioneers to the premiers of the food ordering industry has been a roller-coaster ride, no doubt. But it has been extremely satisfying, both from our point of view as well as from the viewpoint of our over 6.2 lakh consumers, whom we popularly refer to as our ‘Foodies’.

In entrepreneurship, it’s like this: once you decide to jump in the ocean, you will ultimately have to learn to swim and come to the corner. We’ve learnt by experience all these years, trying out dozens of things to find out which was the one thing that would click. And once you find out what clicks, all you’ve got to do is build up on it gradually and you’ll grow.
All in all, I’m very happy that we’ve come so far and look forward to the near future when we’re only going to get bigger and better.

Do you think concept of online food ordering/delivery has finally picked up in India? Has the competition in this segment grown?

In places like the UK, the online food delivery business is thriving. But in India, you could call it pretty much still a fledgling sector. Getting home delivery of food by calling up the restaurant to place your order has taken off to a much greater extent than ordering food online and then getting it home delivered. I won’t be able to give you the exact figures of the online food delivery business as it is still in its early days but yes, the entire food delivery market in India is easily worth over 12.5 billion dollars today, and growing at a steady pace. The estimated number of restaurants all over India that carry out home deliveries is around fifty thousand. This shows the immense untapped potential lying in store for us in this business, which we’re trying to tap amidst changing the mindset of our foodies from ordering food over the phone to online ordering.

Hence, there is adequate space in today’s market for at least two big players, if not more. However, what we consider to be our actual competition is the conventional and long-established method of ordering food over the phone from restaurants. As a result, any restaurant or eatery that provides its phone numbers to customers for the purpose of ordering food becomes competition for us. The challenge to be overcome in this case is to make our online ordering process as effortless as possible to ensure a great experience for our foodies.

How different JustEat.in is from traditional and other competing food delivery services? What's your USP?

We would say that following three are our biggest differentiators which make us unique in the online food delivery world:-

i) Choice -
a) We have a very wide coverage of restaurants in terms of total number of restaurants, type of cuisines they serve, range of meal prices, payment options. We undertake a very granular area level analysis so that we have something for everyone’s taste and budget.

b) You can place orders through our android app, iOS app, Windows phone app, Windows tablet app, mobile website and of course, the desktop version of our site; thus giving the user a wide choice and comfort that “don’t worry when you are hungry. You can place orders on JustEat.in through any screen you are logged on to the internet then.”

ii) Convenience- We work very hard to make ordering through JUST EAT a fast and convenient option. Mobile apps, cross browser support, order automation, online payment enabled restaurants are just some of the features which help in this.

iii) Customer-centricity - We take pride in our “customer is always right” ethos. We take customer complaints very seriously, focussing first on immediate resolution and then root causing it to reduce the number of such complaints.

Please explain your business model. How does JustEat.in monetise its services?

We are a company based on the B2B2C business model. When we entered this industry, there wasn’t a single existing player here whom we could emulate or even get a basic idea of how to set things up. We learnt by actually trying out things to see if they worked or not. The emergence of several other players just seems to validate the initial business model we had come up with more than seven years ago, which won’t necessarily change, since our main goal was and still is the same - to get an additional number of orders for our restaurants, which is beneficial for them as well as us both.

We have a set agreement with all 2500 restaurants on board JUST EAT wherein we charge them commission based on each order that they receive through our portal. It is a give and take relationship – we give them additional orders as well as new customers through our website and they pay us a fixed commission pre-decided at the time of registering with us.

How do you plan to tap smartphone users? How much traction the website is gaining from the mobile platforms?

The JUST EAT online food ordering apps were launched in the third quarter of 2013. Developed on three platforms – Android, iPhone and Windows 8 – the apps can be downloaded for free from the respective app stores as well as from the JustEat.in app download page (justeat.in/mobile).

Working our way towards implementing the ‘Mobile First’ strategy into India, presently, almost twenty per cent of our overall orders are being placed through the said online food ordering apps. And going by the figures, this number could well increase to 40-50 per cent by early 2015.

We’re increasingly noticing the trend of smartphone users accessing our portal through these apps on their phones rather than logging onto the website through their laptops and PCs says We’ve done our best to make ordering food online a super-convenient and hassle-free process for our foodies by means of these apps; the best part being they can order food anytime they like, from anywhere to anywhere!

How simple is your website/app to use?

As I mentioned earlier, our aim is to give our foodies a seamless, hassle-free and super-convenient experience of online ordering- whether it’s our website or our apps.

Each restaurant registered with JUST EAT has its address and entire menus online, with items listed under separate categories such as gravies, appetizers, desserts and the like. The user can simply select the restaurant of his choice and add the required items to the cart to place his order. Filters like location, cuisine etc are also present wherein the user can just enter his location or the cuisine he wishes to have and the restaurants available under the respective headings will appear, making it customized according to the specific user’s preferences. Both the options – cash on delivery and online payment – are available for a majority of the restaurants. Also, an instant order tracking system is available through which the user can track the status of his order using the unique order reference ID.

The option of table booking is also available with the website. An additional option of placing advance orders is also available through which the user specifies the date and time of delivery and the order is processed accordingly.

Our JUST EAT apps come equipped with the features like flexible payment options (pay online or pay cash on delivery), exclusive offers and discounts on orders placed through the apps and the pick-up/takeaway option as well in addition to getting home delivery of your food, to name a few. These features coupled with a very user-friendly app interface make ordering food online very simple on the go, anytime and anywhere.

Our apps were also designed with the main purpose of making food ordering a hassle-free task. Hence, repeat users will see that their delivery address, contact details etc have already been retained since the previous time they ordered and hence will spend less than sixty seconds in placing their new order. Then there are filters wherein you can choose your restaurant based on your choice of cuisine, area where you’re located (the app returns a list of restaurants closest to your present location to help you get your delivery faster), so on and so forth.

What's JustEat.in demographic and user base? How much growth have you seen in the recent past? What are your future projections?

We currently have over 6.2 lakh registered users with us. However, one doesn’t have to be a registered user with JustEat to place an order online. We have two options: one, for registered users to place orders online and two, for guest users. All you have to do is enter your contact details and delivery address plus your choice of restaurant and we’ll make sure you get your food delivered at the right place, at the right time. Hence, a lot of our users are guest users and taking that into account will probably lead to a much bigger number than the one mentioned above.

Our target audience is anyone and everyone who has internet - be it PCs at home, laptops at work or even smartphones in their pockets! Contrary to popular perception, this means our target audience is not limited to IT professionals only. And with our apps coming in and constituting an increasingly major chunk of our orders, this number is only going to grow in the near future.

Which cities are your biggest markets in India? Do you plan to tap the tier 2 and tier 3 cities?

Bangalore, Delhi and Mumbai are the cities which are our biggest markets in India. In the business of food, what works in one city may not work in another. So, gaining stronghold in a city and then trying to xerox the model in other cities would have been a fatal mistake and which we have been careful to avoid. It really starts from the basics like sales territory assignment (area of the city, mode of convenience), restaurant delivery range (average may be 4 km in one city as opposed to 2 km in another), choice of delivery vehicle (motorbike in one city but cycle in another) and computer penetration at restaurants in a city. These and many other inputs are gathered before we enter a city and they help in formulating the initial strategy and keep guiding the tactics to implement these.

Expanding to tier-II towns is definitely a part of our road map in the near future but right now, we plan to be more focussed on the cities we are present in. We don’t want to spread ourselves thin by rapidly going to new cities without consolidating and growing the existing ones.

Whenever we decide to enter a tier-II town, we can intuit that fundamentally the messaging has to change from “online ordering is fast and convenient” to “it is possible to order online, even food delivery”. So, messaging has to regress from benefit selling in metros to awareness/trial in tier-II messages.

As for the rest of India, we have recently set up our base in Pune, Chennai and Hyderabad as well, getting some of the very popular restaurant chains on board. We’re slowly but steadily expanding our operations to other smaller cities as well.

What's the mechanism JustEat.in follows to oversee the listing on the website?

The responsibility of signing up restaurants lies with our sales teams in the respective cities. Once the restaurants to be taken on board are finalised based on certain parameters like local search volumes, popularity and several other factors, our sales pitch does the rest. Our sales managers then maintain a rapport between the restaurants and JUST EAT, thereby ensuring a healthy and profitable give-and-take business relationship.

Once a particular restaurant signs up with JustEat.in and we receive their menus and other restaurant details, it generally takes about 48 hours for the same to go live on our website. The focus now shifts to the operations team who is entrusted with the task of making sure all the restaurant details are entered correctly and updated as and when required in a timely manner on the website.

Online food ordering business has to be seen as a local business and P&L of each city has to be drawn up separately. In the initial months, direct traffic is less and one needs to invest on brand building. One taps the generic demands for keywords related to restaurant, food or pizza related queries. Getting traffic for these keywords are costly. Over an year or two, the brand keyword percentage increases. This drives down the overall cost of marketing. The gestation period in the online restaurant aggregation business is usually 3 years from our past experience.

What are your policies for customer support? How simplified is it for users?

At JUST EAT, we believe that our customers deserve the very best and thus take pride in ensuring their utmost satisfaction. Hence, we work hard to get to the bottom of all our customer complaints and resolve any issues that arise as soon as possible. We make sure that any complaints or negative feedbacks that we receive are immediately forwarded to the concerned department and rectified at the earliest, with the customer in question being intimated about the same.

We have a distinct team that looks after the customer support issues, with our operations team leads also pitching in to personally apologise over phone and redress the customer grievances as and when required. Customers are free to call us up on our customer care number for any immediate queries/complaints or they can send us an e-mail. Whether they reach us through phone or e-mail, we always aim to get things sorted out on a priority basis for our foodies.