Zomato says restaurant prez offers the same discounts he campaigns against

Heavy discounting has caused heartburn among the restaurant partners of the food tech companies

Amid an escalating face-off between restaurants and aggregators, online food ordering platform Zomato on Thursday took a dig at restaurant association head Rahul Singh saying he was offering discounts at his own The Beer Cafe chain of outlets, proving that he was not against such policies.

Singh, who heads 1the National Restaurant Association of India (NRAI), hit back, saying "brokers cannot enjoy the same right as owners!"

In a series of tweets, Zomato founder Deepinder Goyal said: "I welcome the NRAI president, Rahul Singh embracing the Gold standard at his own restaurants. Welcome to Gold, Rahul! @NRAI_India".

Singh is the chief protagonist behind the #logout campaign against aggregators providing "deep discounts" on their platforms and hurting the restaurant industry. The Beer Cafe's app was also offering a 'Gold' scheme.

"This proves that Rahul Singh, is not really against deep discounts, as these discounts are being offered on his own brand, on his own app," Goyal tweeted, attaching a statement. "This logout campaign as it seems now is driven by Rahul Singh, along with the participation of a few large restaurant owners, to use the NRAI platform to sabotage aggregators and benefit themselves."

Claiming that aggregator platforms were being "painted as bullies", Goyal said Zomato will stand by the changes made to its own 'Gold' programme as they are in the supreme interest of its restaurant partners and members.

When contacted, Singh, in his capacity as Beer Cafe founder and CEO, said the company understands the importance of loyalty "as it has to be earned, not purchased".

"It's for our top 500 'BeerOcrats', a privilege. Our loyalty program has been up since 2014 and has 3.5 lakh downloads when Zomato was a director app. As a brand owner, we have the right to provide privileges to our loyalists. Brokers cannot enjoy the same right as owners!" he asserted.

Zomato, which initially claimed that the logout campaign was driven by vested interests, had on Wednesday made sweeping changes to its Gold programme.

Over 2,000 restaurants in several major cities have reportedly delisted themselves from the dine-in programmes of services across aggregator platforms over "unsustainable" deep discounting offered by the aggregators. Zomato has lost 65 restaurants, which is 1 per cent of its restaurant partner base of Gold.

"On a democratised platform like Zomato, large restaurant owners have to compete with independent restaurants on a hyperlocal basis, and are not able to leverage their large presence to pull more distribution/profits," Goyal said. "An aggregator's most important job is to level the playing field for everyone. This is about aggregators vs restaurants; this is about the small restaurant owner vs the large restaurant owner - and we are being painted as bullies."

He said Zomato stands by the changes it is making to Gold, saying they were in "supreme interest" of restaurant partners and valued members. "It helps everyone win," he said.

Refusing to budge on its stand on discounting schemes, NRAI had on Wednesday stated that the restructuring of the Zomato Gold scheme would not resolve the key issue of deep discounts and that its members will continue to stay logged out.

Restaurants in Delhi, Mumbai, Bengaluru, Kolkata, Goa, Pune, Gurgaon and Vadodra have exited platforms including Zomato, EazyDiner, Nearbuy, MagicPin and Gourmet Passport under a #Logout campaign, claiming that "unsustainable" deep discounting offered by the aggregators and table reservation services was hurting their business models.