Zomato Risks Social Media Outrage With Major Zomato Gold Changes

SUMMARY

Updated Zomato Gold rules will come into effect from September 15, 2019

The update looks to be part of the agreement with NRAI after weeks of negotiations

Zomato has already taken down Infinity Dining after restaurant protests

Zomato has yet again found itself in the middle of social media outrage, this time of its own making. The company in a silent update in terms and conditions has changed the rules for its premium membership and controversial product, Zomato Gold.

The updated rules specified in Zomato’s terms and conditions mention that from Sunday, September 15, 2019, Zomato Gold offers can be redeemed only once in a day by a Zomato Gold subscriber. Further, only one offer can be redeemed between two Zomato Gold members on a table. Zomato has also limited Gold members to a maximum of two (2) redemptions per table, no matter how many diners are present and regardless of how many of them have Gold membership. Here’s the new eligibility matrix, as seen on Zomato’s website.

In other changes, subscribers can only avail Zomato Gold once a day from September 15, which makes Gold far less attractive for diners.

It is to be noted that Zomato Gold is an exclusive dining-out membership programme with a monthly or yearly subscription plan. Members can avail complimentary meals and drinks at select restaurants across cities. Zomato claims to have well over 400K Gold subscribers and more than 3700 partner restaurants.

But Zomato Gold has been a source of major trouble for Zomato. It got the company in hot water recently when over 300 restaurants delisted themselves from the app as a part of the #LogOut campaign. Within a few days, the number went up to 2500-3000 restaurants. These protests were then backed by NRAI, a restaurateurs body with over 5 Lakh members. The restaurants listed on the food aggregator had called out Zomato for eating into their margins through Gold and Infinity Dining feature, which provided heavy discounts.

The association had highlighted issues such as “unreasonably high commissions, payment terms and arbitrarily applied additional charges” that restaurants have been charged to be a part of Zomato Gold.

The updated terms for Zomato Gold look to be part of the agreement with NRAI, even as Zomato is in meeting with NRAI and restaurateurs today. This morning reports surfaced that Zomato has taken down Infinity Dining service from its app. Zomato removed the feature temporarily to incorporate customer feedback and other suggestions.

However, the change in the terms and conditions hasn’t gone down well with users. On Twitter, a few subscribers expressed their anger and several others sought refunds on their subscription. In response, Zomato tried to explain, “We apologize for any inconvenience caused. We had to make some changes to the fair usage policy of Zomato Gold to make the program beneficial for our members and restaurant partners. We still believe that Gold remains an attractive value proposition for our users.”

The response and how the company manages the angry voices from users will be crucial in the short to medium term. Especially as Zomato is still recuperating from recent controversies over food deliveries, layoffs and angry restaurants.

A recent YouGov survey noted that Zomato’s Buzz which measures whether one has heard something positive or negative about the brand in the past two weeks, declined steadily due to the mounting controversies and saw a fall of 6.8 points, i.e. from 42.7 in the beginning of July to 35.9 in August end.