What’s new on advertisers’ menu: Zomato, Swiggy, other quick commerce apps

Given the substantial number of users actively engaging with these platforms, they have become a significant and intriguing space for advertisers to connect with their audience, say experts

by Shantanu David
Published - January 30, 2024
6 minutes To Read
What’s new on advertisers’ menu: Zomato, Swiggy, other quick commerce apps

Zomato and Swiggy notice when you’ve opened their app to browse but have gone without actually buying anything. They then quickly send their siren song of the same discount or the offer you checked in such tempting terms that you are compelled to finally make the purchase. Even if you just literally window shop without completing a purchase, these businesses have figured out where you’re spending your time online; move over Netflix and chill, 'tis the season to Zomato and feast or Swiggy and shop.

Gopa Menon – Head of Digital, Mindshare, South Asia, says that what started as a rising trend, particularly accelerated by the pandemic, has now become a widespread practice. “People seamlessly navigate through these platforms, from clicking to reading reviews, adding items to their cart, swiping and making payments.”

Indeed, this popularity of food delivery, quick commerce, fast fashion and other sundry platforms is soaring, with consumers increasingly relying on them for their everyday needs. According to Menon and other experts, given the substantial number of users actively engaging with these platforms, they have become a significant and intriguing space for advertisers to connect with their audience.

Focus, with Numbers 

Data indicates that Zomato has over 50 million monthly active users, while Swiggy boasts of a user base of over 40 million. And these numbers are enough for any brand to reach its potential consumers. As brands are relocating their ad spends, these platforms have a greater potential to gain recognition.

Noting that the effectiveness may vary on various factors including consumer behaviour, ad format, product quality and more, Shubham Shrivastava, AVP, D2C Pro, powered by Team Pumpkin, still finds it fascinating to “witness the growing popularity of these platforms as an advertising space. These platforms provide access to a large user base for bands to engage and enhance the chance of brand recognition.”

Today people spend a significant amount of time browsing restaurants, choosing groceries, and tracking deliveries which is again a leverage for brands to use these spaces for ad content. These spaces are not just limited to a wider user base but offer targeted advertising, data-driven insights and better user experience.

Terming it as shopper media, Girish Ramachandran, Co-Founder and CEO of Shopalyst, says this strategy is sure to add value to brands, “particularly for their lower

funnel ad campaigns. While Amazon has built a robust media business with self-serve tools for advertisers, other e-commerce platforms are playing catch-up and are attracting media spending from FMCG brands.”

Menon believes that these platforms are undeniably gaining prominence for their exceptional capability to meticulously micro-segment and target consumers according to the preferences and desires of marketers. This approach stands out as one of the most effective and precise methods to connect with specific audiences.

“The razor-sharp focus on targeting not only enhances the efficiency of marketing efforts but also ensures promising and impactful results. As these platforms continue to evolve and present new opportunities for reaching out to consumers, their significance in the marketing landscape is set to grow,” he says.

Future Ready, Set & Go 

Sharad Lunia, Founder of releaseMyAd and Xpert, points out that with increasing privacy regulations by Apple and the upcoming cookie deprecation, brands will only find it harder to successfully identify and reach their target audience via the open web. “Especially as third-party cookie tracking, which drives the majority of programmatic buys, gets phased out, leaving a demand void for brands looking to efficiently spend their ad budgets outside the major social platforms of Meta and Google.”

India is unique in that only 2% (10M) of India’s Internet users account for less than 80% of online transactions by value (Ken report). “This tiny but affluent user base thus is attractive to all brands! Interestingly, the platforms have amassed these transacting users, which makes the prospect of targeting them via ads within these marketplaces highly attractive,” adds Lunia.

Indeed, digital marketing expert Advit Sahdev believes that the potential of these platforms is even more powerful than Google, which was the best platform when it came to targeting intent-based users. “Because the users over here have a very high intent and the conversion rates are going to be at least 5-10x better than that on Google and at least 20x more than Meta Ads. This also puts the entire Ads management on the publisher app (Zomato, Swiggy etc) and thus the advertising brand does not need experts or agencies. They just need a skilled resource to coordinate the campaigns.”

Shashank Rathore, Vice President, E-commerce, Interactive Avenues (the digital arm of IPG Mediabrands India) asserts that another significant factor is the consumer mindset on these platforms, with users often ready for transactions, enabling brands to quickly close the marketing loop.

“While this trend has been evident for the past few years, the real game-changer occurred with the introduction of biddable advertising platforms by these players. This development empowers brands with control over budget allocation, precise targeting, and profiling. Notably, these apps are progressing towards creating sophisticated advertising platforms akin to those of Google, Facebook, or Amazon,” he says.

Experts point out that while Google is synonymous with search, making it effective for capturing user intent, Facebook excels in targeting specific demographics and interests.

“However, advertising on such popular platforms provides a distinct edge by placing products directly in front of users ready to make purchase decisions. With a focus on product visibility and conversion, such advertising is a strategic choice for businesses seeking immediate and tangible results within the digital purchase landscape,” says Sahdev.

Looking Back, Planning Ahead 

Initially these platforms attracted the very brands as advertisers whose products they were listing as they were able to demonstrate sales lifts with promotions on their platforms (aka Performance) and increased awareness within identified prospective buyers.

Lunia suggests to think of advertising on these platforms as akin to brands paying modern retail for better shelf space and visibility. “They continue to be highly effective within their vertical. Now, with increasing popularity and scale, other ancillary brands (those not directly selling on the marketplaces) are also getting attracted as advertisers in the lure for targeting the influential “transacting” user demographic that they possess (think of HDFC bank cards ads in the Swiggy delivery tracker page),” he says.

Rathore notes that expenditure on these platforms has significantly increased in the past year, particularly in the food & beverage, grocery, and personal care sectors. “Although they may not immediately surpass the effectiveness of Amazon and Flipkart platforms, they are comparable.”

“Consequently, we can anticipate a surge in advertising spends on these platforms as marketers recognize the expanding potential to engage with their target audience in a highly tailored and effective manner,” says Menon, adding that the strategic and nuanced nature of these platforms positions them as indispensable tools for marketers seeking optimal engagement and resonance with their intended consumer base.