E-commerce giant Amazon has forayed into the online food delivery market in India by launching Amazon Food, giving a tough competition to market leaders Swiggy and Zomato, at a time when the companies are battling losses in steering through the pandemic.
Amazon launched its food delivery service called Amazon Food today in selected areas of Bangalore. The company , which has invested more than $6.5 billion in India,had originally planned to launch the service in India last year, which was then moved to March but amid the nationwide lockdown order, it got delayed further.
As per reports, prior to the launch, Amazon’s employees began pilot experiments by testing the food delivery service with select restaurant partners in Bangalore.
“We also recognize that local businesses need all the help they can get. We are launching Amazon Food in select Bangalore pin codes allowing customers to order from handpicked local restaurants and cloud kitchens that pass our high hygiene certification bar. We are adhering to the highest standards of safety to ensure our customers remain safe while having a delightful experience,” the spokesperson said.
Amazon’s foray into the food delivery market will give a tough competition to Swiggy, and Zomato, another contender that acquired Uber’s Eats business in India in January this year, and Google-backed Dunzo, which operates in Bangalore and relies on food delivery as one of the biggest parts of its business.
Having raised more than $2 billion together,Swiggy and Zomato, are in murky waters as they are losing more than $15 million each month to acquire new customers and sustain the existing ones.
In the past one month, Swiggy has let go of more than 1,100 employees and Zomato has also cut down about 520 roles at the company with people restricting bookings amidst the coronavirus outbreak.
From nearly 3 million orders at the start of the year, both the companies have witnessed a massive drop to fewer than 1 million orders on their respective platforms.
Amazon has launched Amazon’s Prime Now and Amazon Fresh platforms in India to sell perishables and grocery items in recent years and expanded its warehouses in several parts of the country along the way.
With E-commerce giant like Amazon coming into the space, a tough competition is expected by the homegrown delivery leaders in maintaining their hold over the online food delivery business.