Curio

The latest speculation about Zomato being in talks with Grofers, for a possible acquisition, through an all-stock deal, strengthens the belief inferred in the previous article “ Delivery War: Winner-Takes-Al l” about the fierce upcoming competition in the grocery delivery segment. Currently, Grofers valuation is around $650 Million as per ET news report , and if everything fares well, as speculated, then it will be the second big buyout by Zomato following UberEats India operations’ acquisition. If we try to evaluate the current scenario from a synergy standpoint, then from the surface level itself, both the businesses look synergistic in nature. Still, a deep dive analysis will help us to understand and visualize the picture clearly about: the level of synergy, the two businesses resonates with each other and will throw some light on the possible approaches the two might be considering for the post-acquisition integration. Looking at Zomato’s history, they have somewhat become pro...

Today where many firms are facing challenges to run their operations and to keep up the growth rate in these unprecedented times, start-ups like Swiggy and Zomato have found a new growth opportunity to utilize their existing fleet of the food-delivery specialists to deliver groceries. In the view of the current scenario, looking at Swiggy’s and Zomato’s move to expand into grocery delivery services in Tier 1 and Tier 2 cities, undoubtedly, provide relief to everyone as the old patrons of the grocery delivery service, Big Basket , and Grofers of the world are unable to satisfy the demand. However, analyzing the move of two food delivery giants from Al Ries’ and Jack Trout’s immutable marketing laws’ perspective, indicates that they might fall into the trap of “Law of Line Extension,” which suggests that when a brand goes for line extension, then it witnesses a sudden spike in its sales, which tapers off with time negatively impacting the original offering of the brand. Hence, goin...