Summary: Zomato has laid off 600 customer support associates just a year after hiring them as it shifts towards AI-driven automation. The move comes amid slowing growth in its food delivery segment and rising losses at its quick-commerce arm, Blinkit. The layoffs impact employees from the Zomato Associate Accelerator Program (ZAAP), which was designed to transition customer support staff into other roles. Industry-wide, AI is replacing human support roles, with companies like Amazon and Swiggy adopting similar strategies. Zomato aims to cut costs, but the long-term impact on service quality remains to be seen.
In a significant restructuring move, food delivery giant Zomato has reportedly laid off around 600 customer support associates—just a year after hiring them. According to a report by Moneycontrol, the layoffs come as the company intensifies its focus on automation and artificial intelligence (AI) to streamline operations and cut costs.
Zomato Bets on AI as Food Delivery Growth Slows
The job cuts are largely attributed to Zomato’s increased reliance on AI-driven customer support tools, which have significantly reduced the need for human intervention. This transition comes at a time when the company’s core food delivery business is witnessing slower growth, while its quick-commerce arm, Blinkit, continues to struggle with mounting losses.
Zomato’s shift toward automation aligns with broader industry trends, where AI-powered chatbots and virtual assistants are replacing traditional customer support roles. The company aims to improve efficiency and cost-effectiveness while maintaining customer satisfaction.
Impact on Zomato Associate Accelerator Program (ZAAP)
The layoffs are particularly significant given that Zomato had hired approximately 1,500 employees under its Zomato Associate Accelerator Program (ZAAP) just a year ago. The initiative was designed to offer customer support associates an opportunity to transition into roles across sales, operations, program management, support, supply chain, and category teams within a year.
However, the latest job cuts suggest that Zomato’s workforce strategy has undergone a shift, potentially impacting the long-term career prospects of those hired under ZAAP. It remains unclear how many of the remaining employees will be absorbed into other roles within the company.
Quick Commerce Struggles and Financial Pressures
Zomato’s quick-commerce vertical, Blinkit, has been a key focus area for the company, but it continues to face financial challenges. The segment is capital-intensive, requiring significant investment in warehouse infrastructure, last-mile delivery logistics, and competitive pricing to sustain growth.
Reports indicate that Blinkit has been struggling to turn profitable, which may have contributed to Zomato’s decision to reduce its operational expenses through layoffs and automation.
Industry-Wide Shift Toward Automation
Zomato is not the only company embracing AI to streamline customer service. Many global tech and e-commerce firms, including Amazon and Swiggy, have been deploying AI chatbots and automated systems to handle customer inquiries efficiently. According to a report by Gartner, by 2026, AI-powered chatbots are expected to handle 75% of all customer service interactions, reducing dependency on human agents. (Source: Gartner)
What’s Next for Zomato?
While the layoffs may help Zomato optimize costs in the short term, the long-term impact on customer satisfaction and service quality remains to be seen. As the company navigates the challenges of slowing food delivery demand and quick-commerce expansion, its ability to balance automation with human intervention will be critical to maintaining customer trust and loyalty.
For now, Zomato’s focus appears to be on leveraging AI-driven efficiencies while restructuring its workforce to align with evolving business needs.
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Last Updated on Tuesday, April 1, 2025 4:09 pm by Aarti Kumari
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