Foodtech giant Zomato is set to revolutionize the going-out experience with the launch of its new app, ‘District.’ Designed to cater to a variety of leisure activities, District will enable users to discover and book restaurants, purchase tickets for movies, sports events, live performances, and more.
In a recent shareholder letter, Zomato CEO Deepinder Goyal highlighted the significant strides the company has made in its dining-out business. Operating at an impressive run-rate of over $500 million annualized gross order value (GOV), this segment is now profitable. Goyal emphasized the potential to expand further into the going-out market, offering additional services such as sports ticketing, live performances, shopping, and staycations. Some of these services have already been launched, with more in the pipeline.
“Creating a one-stop destination app for going-out could transform each of these use cases. We aim to achieve this with our new District app. If executed well, we envision going-out becoming a major B2C business for Zomato,” said Goyal.
In a strategic move to bolster its offerings, Zomato recently engaged in preliminary discussions with Paytm to potentially acquire the fintech company’s movie ticketing and events business. This acquisition would further strengthen District’s position in the market.
Zomato’s Chief Financial Officer, Akshant Goyal, shared insights into the company’s strategy during a post-earnings call. He revealed plans to leverage traffic from Zomato’s existing food delivery app to promote District, aiming to keep customer acquisition costs low. Drawing parallels to the development of Blinkit, a separate brand and app, he outlined a similar approach for District.
“We’re launching District as a distinct app and brand, similar to Blinkit. Our goal is to maintain low customer acquisition costs by utilizing the traffic from the Zomato app,” Akshant Goyal explained.
Zomato’s going-out business currently includes the dining-out and Zomato Live verticals. This segment contributed INR 95 crore to Zomato’s top line in the latest quarter, marking a remarkable 126% increase from INR 42 crore in Q1 FY24.
In addition to the growth in its going-out business, Zomato reported a consolidated net profit of INR 253 crore in Q1 FY25, a significant rise from INR 2 crore in the same quarter last year. Revenue from operations surged by 74%, reaching INR 4,206 crore in Q1 FY25, compared to INR 2,416 crore in the corresponding quarter of the previous year.
With the launch of District, Zomato aims to create an integrated platform that enhances the going-out experience for its users. By combining dining, entertainment, shopping, and more into a single app, Zomato is poised to become a leading player in the leisure and entertainment sector.
