Online Food Ordering – Does This Really Work In India?

(By Porush Jain)

Have you ever ordered food online? Have you ever booked a table online? Did you ever look for these things?

I am not so sure!  But certainly many entrepreneurs think that you do. We have a score of entrepreneurs who are all set to answer these very questions.  Some dozen websites have popped out in the last year itself offering online food ordering and table booking services. Is there a sound business rationale in their offerings or would they just come and go without bothering anyone.  Some of the websites have certainly become popular in Bangalore, Hyderabad and Chennai. This may be largely due to a significant population of non locals here.

First questions first!  Are Indians searching for food online? A detailed search at google insights shows that we actually are. India showed relevancy to searches such as “Order online food” (48/100), “Online restaurant” (45/100) and “online pizza order” (33/100). Considering the size of India these numbers are not bad at all.

online-food-ordering

A quick search on the net reveals some 20 websites that are offering these services. Namely Cityguide.in, Eveningflaovors.com, hungryzone.com, bookmykhana.com, 2home.in, webdhaba.com, cityfoods.in, dinewhereever.com, mhungry.in, onlinefeast.com, unclejis.com, onlinekaha.com, hyderabadmenu.com, menulog.in, orderplz.com, bringmefood.in.

A further traffic search in Alexa shows that only few are worth mentioning, as traffic for most of them is nonexistent. Now I will cover some noticeable websites in this business.

Eveningflaovors.com This is a Bangalore based website where we can book a table online. The website has a pretty impressive design and supports web 2.0 features. What is really fascinating is the depth of their database. Through this website you can book a table in some 450 restaurants in Bangalore. Their revenue model right now seems to be the advertising revenue from restaurants itself.

hungryzone.com is a multicity based website which seems to be working very hard. Hungryzone goes a step ahead of eveningflavours by providing complete menu of the restaurants and the facility to place your orders online. Their revenue model is slightly different as they would be charging the restaurants on an order to order basis. The website is also elegantly designed and supports many web 2.0 features.

logos-online-food

bookmykhana.com is a NCR based website which again seems to have invested quite a lot in its website. They also have the facility of online payment. Though the Websites is professionally designed it is not impressive or intuitive. The order selection procedure and checkout is itself very tedious. Their database is also week at present.

2home.in A very noticeable entry in the online food ordering business has its root in Ahmadabad. Not because this has been started by three IIM grads but because the website makes a lot of sense. The locality search and the time bar (drag to select the time of delivery) on the home page makes it very intuitive.  Simple and easy to use the website is a true web 2.0. I should also mention very cleverly designed logo.

All said and done I am still not convinced with the potential of this business.  There are many questions that these entrepreneurs need to answer. Is it not easier to call just dial and get the contact details of the restaurant?  How many Indian’s search for a restaurant online before going out? Will this revenue model provide a sustainable growth? And Is it scalable enough?

19 Responses to “Online Food Ordering – Does This Really Work In India?”

  1. July 27, 2009 at 9:41 pm #

    I see great potential for food portals, as they provide a common platform through which food can be ordered. They provide review of restaurants, menus etc. which is very informative. Most of the restauarants do not have even a web presence and hence they can use the food portals effectively to generate more business.

    Hungryzone and bookmykhana are way ahead of others and their business model certainly makes them winners in this space.

  2. July 29, 2009 at 4:39 am #

    I think its a great concept but the infrastructure in india is not yet ready for it… Quality of service will be an issue & the determining factor… as for me, i may use visit them to check out restaurants but will rarely order something online… i prefer to go out and eat OR directly order food from a restaurant I know (&trust)

  3. July 29, 2009 at 12:40 pm #

    fantastic concept. But i feel they will grow only if, they can collaborate with many food chains and many cities.
    Well researched and written by the writer.
    -
    Sharad

  4. July 29, 2009 at 1:58 pm #

    I see an interesting model opening up for the online food portals. As most of the restaurants do not have a strong marketing, sales and IT functions, the online portals can fill this gap by partnering with the restaurants to provide outsourced services, just like the big guys are doing in software business.

  5. July 29, 2009 at 5:19 pm #

    I totally agree with you Manjunatha. This certainly is a new sector that IT companies can look into. Popular restaurants which are not able to fulfill the demand because of seating limitations etc can certainly follow this route to increase sales.

  6. man
    July 29, 2009 at 6:49 pm #

    its really a great idea….but the success will depend upon the infrastructure of india….

  7. July 29, 2009 at 7:10 pm #

    The article is really well-researched and written. Despite co-founding one of the sites mentioned (2home.in) and spending quite some time trying to find the other similar websites in India, a couple of names mentioned were actually new to me!

    As the author says, the possibility of getting restaurant phone numbers from justdial significantly limits the value provided for online table booking. On the phone customers know immediately if a table is available, whereas online they have to wait for a confirmation call which is a drawback. The only advantages for websites are customer reviews if it is available, and the ability to search within the menu while suggesting restaurants. Neither reason is very compelling.

    However, for home deliveries and takeaways, customers need to see the menu, and for this websites are far more convenient than voice. Searching within menus could also be important as customers may have their mind made up about what they want to eat, rather than where they want it from. In our opinion, a search feature which can answer questions like “Which restaurants can deliver club sandwiches to my location at 3 p.m.” definitely provides customer value.

    The question regarding whether there is a market for it in India is still an open one. We feel that the market can be created, because data from our short three months of operations show that while customer acquisition is difficult, retention is not – those who order online once almost always order regularly after that. Our conclusion is that before they place their first online order, people might have misconceptions about the reliability of ordering online. (In reality, the order reaches the restaurant immediately so there is no delay compared to ordering on the phone, and you don’t waste time or make mistakes doing “Delhi ka D nahi, Bombay ka B” on the phone). The people who do order once realize that it works and is much more convenient. The challenge for companies like ours is getting people aware of the service and convincing them to try it out once.

  8. July 29, 2009 at 7:50 pm #

    I agree with you all that there is a gap that these sites can fill. & for that matter this gap does not just exist in restaurant business but in most of the retail businesses – think of the grocery shop, of the local book store, sweets shop, – just take a tour of the local market and you will find hundereds of businesses which have weak sales & marketing functions.

    My point is :
    1. India may not be the right market for this business due to lack of infrastructure & QoS.
    2. getting customers is not a problem – You will get customers in a 1bn+ market. The issue is in how to ensure service. As a customer can I be guaranteed that if I order food, it is
    – hot when delviered
    – the same what I ordered
    – delivered within time
    – prepared with good quality material

    3. Can polular restaurants who are already running at full capapcity provide delivery service during peak times ?? I don’t think so. It would be the other way round – restaurants who are good but are not able to attract customers will benefit from the online service

    btw porush, you forgot about http://www.kitnebaje.com, http://www.mhungry.in, http://www.menulog.in – all backed by big investors or VC funds… what I see is competition getting tougher in this online space.

    I’ve been researching this space for a while and would like to know customer visiting trends, the profits & how much restaurants willing to share a pie of sales for increased sales

  9. July 29, 2009 at 10:34 pm #

    @ Ashish thanks for the valuable information regarding the important players that i have missed.

    I also agree with your first two points.We cannot be sure about the service quality that these firms would be able to deliver besides the IT infrastructure bottleneck that India has.

    I beg to differ a bit on the third point. Generally the kitchen capacity of a restaurant is more or less equal to its seating capacity. Through online orders they can have more sales without the need to increase their seating capacity which generally is expensive.Hence by increasing their kitchen size or capacity they would be able to generate higher revenues.
    New restaurants or sick restaurants would can also benefit from online sales if promotions are done correctly.

  10. August 5, 2009 at 10:40 pm #

    Hi Porush,
    Nice article! Kudos!. To answer your question “Will it work?”, eventually it will work. Theres been a sudden boom in the restaurant industry, everyday you see new and small restaurants offering exotic and exciting cuisines. But can they afford to advertise themselves in a huge way. The answer is most of them cant.
    On the other hand, like you have stated in your article people especially from the IT and BPO sector rely on the internet to find new places to dine out. Because people are now more willing to try out new stuff . People are searching online for restaurant information and their menu.
    The internet is a great medium for small restaurants to market themselves and taking orders online is another medium through which they can reach new customers. It’s a win-win situation for the restaurant people. Cos they lose nothing.
    To summarize, such websites give them a web presence, also they don’t have to spend anytime or money to develop such a system that enables them to take orders online., it’s a great advertisement platform for them, it’s a wonderful interaction tool where they can view their frequent customers. It will help understand their customers only better. Mind you a customer most often than not goes to a restaurant where he/she is comfortable and well treated. These sites can be used as a tracking and interaction tool as well. These are the reasons why restaurants should use them and from my experience most of them understand that. IT also depends on what kind of people the restaurants are considering as their target customers. Are they looking to attract young people, families, middle class, upper class?
    Talking from the end user’s perspective, why the user should reserve a table online? Why not do it over phone? Good question. This is where such sites should demonstrate their “usefulness”. Stuff like exclusive coupons and deals for the site users will help to increase the usefulness factor, wont it? Also enabling the user to enjoy a highly customized dining experience is the greatest asset here. The overall experience should be much better. This can be achieved in different ways.
    Im not saying users will come across such sites and use it right away. Because first of all theres no trust. He wont be sure whether it will work. It’s a “change barrier”. And its universal. It can be broken only by time. Word of mouth is probably the best and cheapest way for such sites to advertise themselves, because it not only helps them to spread the word but also spread the trust thing, you know. Because I would be far more willing to trust a system my friend recommends rather trust a site whos ad I came across in some random web portal that itself sucks big time.
    This model WILL work. Whoever takes the right approach will win the race.

    And by the way, im Keyan, I own one. You can find it here http://feelingpeckish.in . Its for Chennai users only.

  11. August 8, 2009 at 3:53 pm #

    Hi Keyan,

    Thanks for your inputs. If you provide good enough services surely the traction and popularity would grow. Critical factor would be to have a solid revenue model which is sustainable (in the sense revenue is more than expenditure). All the best with your website.I would like to see one website in the green to decide upon the feasibility of this model.

  12. YP Singh
    August 13, 2009 at 5:55 pm #

    Nice to see so people discussing it. I am a end customer and i always use to think about this concept. I am based in delhi and i always use to think that some one should do this. As a user why i should order online

    1. I really do not need to speak to person in restaurant as they normally are not equipped to deal with customers except the pizza outlets.

    2. i do not get any discount.

    3. anwer to question – “how long will it take” is always 15 mints.

    4. I understand that digital order has long term benefits for me as customer.

    5. No paper menu and fight with anyone.

    i tried ordering from many site but most of them listed here are not completly functional. Based on your article i tried bookmykhana.com today and to be very frank i was not expecting any thing great as my past experiences were bad with few other like aptd and few more which are thankfully not in you list. thanks to your effort and website listed are really good. I tried bookmykhana.com and i got completly bowled by them. I never expected this much of personal attention to feed me. it was just good. Their website is very detailed and may be that the reason you said it is not intitutive but i found it good from end user perspective and ordering steps were not confusing and above all it was all working and i was able to pay there only so no more cash need. In fact i paid using my reward points which i earned on my imint card. These were useless for me but atleast now i can buy food from them.
    Good job done by bookmykhana.com, at last there is something completly professional and personal for me to use and which is working !!
    Thanks for your article which gives me direction to use it.

    Cheers!!

  13. Raj
    October 21, 2009 at 3:05 pm #

    other site i could see is http://www.ramnee.com which is strong in data with up to date menus and i feel it is a perfect information on food and restaurants in Hyderabad.

  14. October 25, 2009 at 11:11 am #

    Hi All,

    I read all your comments but it seems that nobody in this zone has experience in this field as I am having. I am making a very strong but authentic statement that Online Ordering cannot exist in India.
    All the companies working on this concept in some or the other way will be using phone to make close the semantic gap between customer and restaurant.

    Some reasons why online ordering will not work:
    1. We in India not only order for burgers & Pizza (Ingredients composition doesnot chnage with people requirement), we order for sweet methi matar malai or tadka dal thodi mirchi kam :). If you analyse the menu of a restaurant there are number of items which are seasonal.

    To over come all these every time you cannot update menu and its ready difficult to fill this gap between restaurant and customer.

    2. Food gettin delivered. Delivery team of restaurant or online platform cannot be as superb as Domino’s. Trackin order is difficult.
    Customer also create lot of problems in case food is not delivered in time.

    3. Low input to output ratio.

    4. Making people use online ordering system.

    5. Revenue model is questionable.

    I have analysed every single player in this field.
    Hugryzone is best in the business. Another one is tastykhana. Others will really have to work a lot harder.

    For restaurant information foodiebay is the best.But I cannot really understand how they are surviving ?. I cannot see any revenue resource.

    I am not an IIM or IITian. Done BE from a very nornal college but have a very good insight on this topic.

  15. Cherian
    November 2, 2009 at 4:50 am #

    You have to work hard in order to be success in this field. It wont be easy task though, may take several years to achieve the results. For example, Sulekha.com is a successful bussiness now but do you know when they started? 1998.

    1) Publicity is important. How many people know about the website? What is the reliability? How long you have been in bussiness?
    2) Good service is important. Even thought you get 1 or 2 orders per day, you have to do good job in order to build the good relationship with customers. Word of mouth matters in India.
    3) How about the freshness of the data? You have to keep menus update to date. Then only customers will believe in your website. Customer rely on your website for their restaurant info needs.
    4) Website look and feel. Website should be technical good, there should not be errors. Should be bit professional. Should not be cluttered. Customers come to site to order food, just keep it clean and clear for them to do what they need. Just because you have space, should not populate with all possible colors, afterall its not a pure informational site, its also a business oriented.
    5) How many restaurants listed on your website? In the city, lets say there are 1000 restaurants and do you have 100 restaurants on your website?. How can you expect good bussiness just having 100 restaurants leaving 900. Customer comes to your site expecting some info about the restaurant but if its not there, he might not come to your site. First impression is best impression.
    6) Internet users are the potential customers. What is your strategy to approach them? How many campaigns you gone through? google adwords/adsense, internet articles, press releases, banner ads on websites, tv ads, etc., Have you approached software companies HR and explained the services?
    7) You have to build strong relationship with restaurants in order to get the order delivered to customer. How many people in restaurant(I mean employees) know your website. For example, customer places an order and calls the restaurant about the order, some employee picks up the phone, what is the guarantee he knows about the site, about the order that is placed, etc.,
    8) next point is About the payment. Can customer pay by credit card? debit card? paypal? for example, customer is in USA ordering food for their parents in India, how do you make them pay? If credit card, what about currency conversion fee?
    9) you need to have 20+ lakhs to start and be a success in this business
    10) No busssines will be instant hit rightaway. It will take considerable time depends on various factors I explained above. Can you sustain until then?

    I can list down another 10-20 points easily……But this business will not be instant hit, it will take its own sweet time. Are you ready?

  16. khushwant
    January 16, 2010 at 10:30 pm #

    It was really nice to read the feedback and suggestion of the people regarding this market.

    But the point which is still untouched is the revenue model ?

    any one who can share their feedback on the same ?

  17. February 10, 2010 at 6:57 pm #

    Its hard to generate revenue in initial stage thru portal. Even we are facing problem to generate revenue. But we can certainly get exclusive discounts from restaurants and sell discounts in market.This can create popularity. One can also collaborate with Justdial and ask them to transfer all restaurant related call to you. You can easily charge 10/person thru table booking from restaurant. Major Revenue in later stages will be generated only thru restaurants by promoting offers, new restaurants. This online menu has really got a lot of potential as it will create new medium of advertising for restaurant which will be cheaper and effect at the same time very local.

    We are implementing same at our organization.

    I am looking forward for partners in Mumbai, Bangalore and une.

    Thanks & Regards
    Sukrat Ray
    Founder
    KhaaoPiyo.com

  18. August 4, 2010 at 6:30 pm #

    Amazing concept.. Already very popular in the US. Infact international companies are setting up shop in India to do business in the internet/mobile ecommerce space (esp food & grocery ordering). However as rightly said infrastructure is lacking in India. Many restaurants dont have a PC and still work with a Pencil and paper.

    When talking of online food ordering, how do you send the order request to a restaurant who is not connected to internet and nor wants to incur cost by installing a computer and employing an individual to manage that. If one finds a technology to solve this, i dont think growth, revenue, success is not a matter to think about.

    All the best to all of you..

    INDIA NEEDS MORE ENTREPRENEURS FOR ITS OWN GROWTH

  19. October 12, 2013 at 3:03 pm #

    Nice article and thanks for it. While searching online, I have come across an online food portal named JusFood.com. It is primarily based in Chennai and as a start up their services is really good.

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