Zomato Looking To Relaunch ‘Xtreme’ With A Tweaked Strategy

Months after suspending its logistics business ‘Xtreme’ due to poor demand, foodtech major Zomato is now reportedly planning to modify the offering and relaunch it in the market.

As per ET, the focus of Zomato’s Xtreme is being recalibrated.

“The service is being tweaked to focus on the core food delivery strength of the company…there are several restaurants that deliver directly. This may still be an experiment that the company may or may not scale,” the report quoted sources as saying.

Responding to Inc42’s queries, Zomato spokesperson said, “These claims are baseless and not true.” 

Xtreme, quick parcel delivery service for merchants with an independent application, was initially launched in October 2023, as a move for the foodtech startup to foray into the logistics space.

However, the company had to pull its shutters on the logistics wing, hurt by slim demand, earlier in July. The Xtreme app was then removed from Google Play Store. For existing users, it displays the message that the area is not serviceable. 

“There are several restaurants across cities who want to maintain their own channels for ordering but want the quality of last-mile delivery that Zomato offers…in the earlier experiment, too, the scale never became so big that it would affect the company’s food delivery services for its restaurant partners but if it ends up achieving a certain scale, it will take a call accordingly,” the report cited one of the sources.

Furthermore, the unicorn tried relaunching its intercity delivery business Legends in July, which was also suspended, only a month after its entry into the market. The move to shut Legends was aligned with Zomato’s strategy to experiment with new offerings, particularly for the food delivery vertical, and shut those which are not getting enough traction.

The company has been engaging in multiple experiments, throughout this year, to study the reach of its business line expansion in areas such as logistics, entertainment, last-mile deliveries, large order fleet and more.

In late August, the company acquired Paytm’s events and movies ticketing subsidiaries Wasteland Entertainment Private Limited and Orbgen Technologies Private Limited, for INR 2,048 Cr in an all-cash deal. 

Updated at 03:30 PM

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