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The encyclopedia · Advertising & PR · Marketing decision · 2019

Zomato's CEO taunted the restaurant association leading a revolt against Zomato Gold

Close to 2,000 Indian restaurants quit Zomato Gold in a #LogOut campaign over deep discounts. Its CEO responded by naming and taunting its leader.

Zomato · 2019-08

What happened

Zomato Gold was a subscription that gave Indian diners deep discounts — often a free or buy-one-get-one dish — at partner restaurants. By August 2019, close to 2,000 restaurants in Delhi NCR, Bengaluru, Mumbai and Kolkata had had enough. Led by the National Restaurant Association of India, they began delisting themselves from Zomato Gold and similar discount apps under a campaign they called #LogOut, saying the 'unsustainable' discounts were training customers to chase deals and wrecking their margins.

Zomato's founder, Deepinder Goyal, responded with an eight-point thread on Twitter. Part of it was conciliatory: he admitted that 'we have made mistakes,' called the revolt 'a wake up call,' and acknowledged that bargain hunters had joined Gold and were 'hurting some segments of the restaurant industry very badly.' He asked restaurant owners to stop the campaign and promised to modify Gold into a 'win win.'

But Goyal also went on the attack. He accused the association's president, Rahul Singh, of 'driving the #logout campaign along with some big restaurant owners and using NRAI to sabotage aggregators and derive benefits for their own businesses,' pointing out that Singh's own restaurants offered Gold discounts. 'Welcome to Gold, Rahul!' he taunted, and declared that 'Zomato is logging out of the logout campaign.' Naming and mocking the man leading the revolt did not split it; it confirmed the partners' belief that Zomato saw them as adversaries, not customers.

Why it happened

  • The response mixed an apology with a personal attack, so the conciliatory words were read as cover for the taunts rather than the other way round.
  • Naming and mocking the association's president turned a commercial dispute into a public grudge match, giving the revolt more attention and more recruits.
  • Goyal framed the problem as a few owners gaming the system, while the partners' complaint was about Zomato's own discounting model — so the answer did not address the grievance.
What it cost~2,000 restaurants delisted; public war with NRAIembarrassing

The lesson

You cannot ask partners for a truce and taunt their leader in the same breath. Paired with a personal attack, an apology reads as bad faith — and the attack is what partners remember.

Aftermath

Zomato said it would modify Gold into a 'win win' for restaurants and consumers, and noted it had changed the programme's rules the previous year after similar concerns. The #LogOut campaign nonetheless spread from Gurugram into a nationwide movement across India's biggest cities. For platform businesses, the case became a warning that the partners who supply your product are also a public you can lose — and that publicly mocking the person organising against you is the fastest way to prove their point.

Sources

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