Restaurants also want greater access to the data Swiggy and Zomato have on their customers. For restaurants, this data could allow them to tailor their offerings based on diner preferences. The NRAI says the contracts between restaurants and aggregators allow data sharing, but that Swiggy and Zomato stopped doing so, citing customer safety and privacy issues.
According to an ex-Swiggy executive, who left the company in July 2019, not sharing data has less to do with security and more to do with business. “It’s not an issue to share with restaurants, there are a few security issues, but that’s solvable. It’s mainly not wanting to share data. They don’t want to become middlemen and become redundant,” the former executive said.
The NRAI wants this sort of transparency extended to the functioning of aggregators’ search algorithms. It wants more clarity on the metric used to rank restaurants. Whether ranks are based on order value, heavy discounts, or something else. Restaurants claim search results don’t always match the input and mostly show heavily-discounted brands or the aggregator’s own private brands more prominently.
Then, there’s exclusivity. The NRAI claims that contract terms give Swiggy and Zomato unconditional licensing rights to use a partner restaurant’s branding for their own promotion. The NRAI also doesn’t want aggregators to ask restaurants for exclusivity in exchange for lower commissions. Instead, it wants a standardised commission structure.
The final bone of contention is the private label and cloud kitchen play. The NRAI says aggregators owning their own private label brands or cloud kitchens is anti-competitive. Their concerns are easy to understand given that platforms own troves of customer data, from food and price preferences to timings and locations of orders, all of which goes towards fine-tuning a private label or cloud kitchen.’
These demands aren’t new. The NRAI has had meetings with Zomato and Swiggy even before the #Logout campaign. With Zomato, the talks were centred on their membership schemes like Gold. With Swiggy, the talks revolved around the delivery business instead. Zomato and Swiggy did not respond to detailed questions sent by The Ken.
The intensity of these meetings, however, has been dialled up significantly since the #Logout campaign kicked off. The NRAI met Zomato and Swiggy separately on six occasions to hash out their differences. Zomato, which was the target of the campaign’s initial ire, actively pursued these discussions initially. But as the intensity of the campaign died down, so did its enthusiasm to negotiate. The NRAI and Zomato are scheduled to meet again on 25 February, according to Thomas Fenn, an NRAI managing committee member.
“With Zomato, we had some immediate conversations and meetings post the logout, and one or two specifically for the logout campaign. The two meetings where we discussed Gold were called by Zomato since it was time-sensitive. But otherwise, it’s like saying, ‘We met two weeks ago, let’s see if we can meet again’,” said Fenn, who runs a restaurant in the National Capital Region.
“There is a willingness to have discussions, but not the willingness to change things,” he added. To turn talk into action, restaurants are trying to get regulators onside.
The FHRAI, which banded together with NRAI in October, has already knocked on the door of the Competition Commission of India (CCI), the country’s top anti-competitive regulatory body. This was to address issues between aggregators and suppliers in the broader e-commerce space. Having already drawn attention to the practices of online travel agents like MakeMyTrip and OYO, the door is now open for FHRAI to take similar action against restaurant aggregators.
The restaurant industry’s fight also got a fillip in early January, with the re-entry of the Department for Promotion of Industry and Internal Trade (DPIIT) for the first time since the #Logout campaign. DPIIT, which functions under the ministry of commerce and industry, met with NRAI and food aggregators in early January to discuss contentious issues such as cloud kitchens and exclusive tie-ups.
Prior to the stir by restaurateurs, DPIIT had called for meetings with the NRAI and food tech regulators thrice in 2019—in January, February, and July. These meetings focused on the six key issues that NRAI has rallied around. At each meeting, the government body allowed either side to make their case, offer examples, and rebut the other’s contentions.