According to a recent report, the Open Network for Digital Commerce (ONDC) now handles 3% of food delivery orders in India. This development highlights ONDC’s growing presence and impact within the country’s food delivery sector.ONDC Makes Inroads in India’s Food Delivery Market, Now Accounts for 3% of Orders
India’s food delivery market, once considered a settled duopoly between Zomato and Swiggy, is now witnessing the rise of a third player.
The Open Network for Digital Commerce (ONDC) has achieved a 3% market share in food delivery orders across India, according to an ET report. “Nationwide, ONDC now facilitates 60,000 orders per day in the food domain, capturing 3% of the total order volumes managed by Swiggy and Zomato individually, each receiving 2 million orders daily,” a source stated. ONDC is a government-backed platform that enables various e-commerce entities to operate without relying on a centralized platform like Zomato or Swiggy.
A recent analysis compared ONDC’s performance to major platforms in its operational domains, revealing that ONDC is particularly competitive in larger cities such as Bengaluru. “On July 7, 2024, ONDC set a new record with 38,000 daily orders in Bengaluru’s food sector, representing 17% of the daily order volumes of Swiggy and Zomato individually in the city, where each received 220,000 orders,” the source added.
ONDC’s progress is notable, having begun pilot operations in Bengaluru in late 2022. Initially, it allowed customers to purchase groceries and other goods through approved ONDC apps, but over the past year, it has expanded to include restaurants and food delivery. ONDC initially drew attention by offering better discounts than Zomato and Swiggy, sustaining some of that early momentum to capture a small percentage of food orders.
ONDC’s growth prospects look promising. Companies like Ola, which struggled to build their own food delivery businesses, are now leveraging the ONDC network and promoting food deliveries on their apps. Additionally, Flipkart is reportedly considering integrating with the ONDC network, and Paytm has been offering ONDC orders for over a year.
A significant push for ONDC could come from restaurants themselves, which currently pay high commissions to Swiggy and Zomato but could benefit from lower commissions on ONDC orders. Designed as an open platform, much like UPI for payments, ONDC allows restaurants to list themselves while other entities handle payments and deliveries. Despite the complexity of coordinating many moving parts for each order, ONDC’s current 3% market share and potential partnerships with major players like Flipkart position it as a serious challenger to the Zomato-Swiggy dominance in the coming years.