With the pandemic fuelling a paradigm shift in consumer behaviour aided by digital acceleration and customers preferring doorstep food delivery over dine-in services, cloud kitchens have emerged as viable business model in the F&B industry. Many restaurateurs are now looking to shift from a traditional dine-in facility to set up a delivery-only business to tide over the havoc wreaked by the Covid-19 pandemic. To aid the process and showcase the importance of incorporating cloud kitchens into the Indian restaurant industry, the National Restaurant Association of India’s (NRAI) Mumbai chapter recently held the Cloud Kitchen Convention where prominent stakeholders from the cloud kitchen space got together and shared their knowledge and cutting edge insights.
Last year, NRAI had launched the #OrderDirect campaign to offer a democratised digital channel with low commissions to reduce their reliance on the aggregator platforms.
IndianTelevision.com exclusively spoke to Swiggy AVP of sales Swapnil Bajpai on the foodtech brand’s association with the NRAI event. This sheds the spotlight on one of the major concerns of the industry on how to reduce the dependency on restaurants and cloud kitchens on aggregators such as Swiggy and Zomato, and the ongoing debate of whether they are a boon or bane for the F&B businesses.
The Cloud Kitchen industry is expected to become a two billion dollar industry in India by 2024 as per reports, paving the way for accelerating and revolutionising the concept of dine-in restaurants and cafes. It is this emerging ecosystem that the ‘voice of the Indian restaurant industry’ aims to tap into and grow through such conventions.
The Swiggy executive was one of the speakers on the event’s panel on ‘Cloud Kitchen marketing – How to stand out amongst the crowd?’
In this chat, Bajpai further talks about Swiggy’s roller-coaster ride through the pandemic and sustaining the growth going ahead.
Edited excerpts:
On Swiggy’s association with the NRAI cloud kitchen convention
We call our restaurant partners as partners, and we have a partnership with the restaurant association. And this partnership is for something meaningful, not just namesake. We genuinely believe that as aggregators we can learn a lot from the restaurant partners in conventions like these. And we will be able to share our experiences also through which they will also get to learn from us, hopefully. So I look at it as a platform for the mutual sharing of ideas and experiences.
On #OrderDirect campaign by NRAI
I come from a background of FMCG (Bajpai was previously with Procter and Gamble for close to ten years). And one of the things we learned was wherever a shopper shops we have to make a product around it. And it’s the same for the restaurant partners. When it comes to ordering direct, it’s one of the channels that they would want to operate in. So as aggregators we don’t have a point of view. In fact, if we are able to bring a solution to that, we would also want to do that. So, we don’t see it as competition- it’s just one of those ways to serve the consumer better.
On Swiggy’s plan to drive awareness about cloud-based kitchen
Awareness, in general, is created for a brand. Whether the brand is coming from a cloud kitchen or it is coming from a physical restaurant, as a consumer one does not care about it, till the time we know that the brand is preparing the food in a safe way and the quality of the food is good. So we will definitely employ all levers to showcase all brands and their offerings to the consumer – be it cloud or non-cloud in our ecosystem. We already have a bouquet of marketing tools that a new upcoming brand can choose from and we can showcase it on the app. We also go beyond that through our e-mailers and push notifications which we send out to promote and create awareness about the brand.
On challenges faced during Covid lockdowns
There have been two cycles of the pandemic that we have seen in wave one and wave two. In the first wave, the biggest concern that people had was whether this delivery would be safe for them or not. Which’s why we saw a massive decline in orders across the board. This coupled with lockdowns and closure of places, movement control etc. In the second wave, this issue was not there, because over time it was established that food delivery is safe. And we also ran many campaigns from Swiggy’s side – I’m sure Zomato also did that, and so did restaurant partners. So mental barriers were taken away from people that food delivery is not safe. Hence after the second wave, we have gradually seen business pick up again, but that first wave to second wave period was very tough when the numbers were pretty low, as compared to 2019 figures. Unquestionably, after the second wave, the platform saw a huge spike in orders.
On riding the recovery wave post-pandemic
I foresee a massive potential for food delivery because of the pandemic-fuelled digital acceleration led by increasing internet penetration and also, the frequency of eating out in the country. What delivery does is increase the frequency of ordering out. There are dine-in occasions that you cannot replace with delivery and likewise, there will be delivery occasions that you cannot replace with a dine-in. So each has its own space and they complement one another. Delivery actually increases the frequency of ‘eating out.’ And, now with places opening up, dining-in will also start picking up in its own way. Even pre-Covid when delivery was increasing, dining out was parallelly growing- it’s not as if when delivery picked up, dining actually reduced. So I definitely see food delivery sustaining and scaling up in the coming future.
