Swiggy's ad spends down by 75% to Rs 447.5 crore in FY21

Bundl Technologies, the parent company of food delivery app Swiggy, has cut down its advertising promotional expenses by 75% to Rs 447.5 crore for the fiscal ended 31st March 2021 as against Rs 1806 crore in the previous fiscal, according to financial data accessed by the business intelligence platform, Tofler.

The company's revenue dropped 23% to Rs 2145 crore from Rs 3548.5 crore in the previous fiscal. Its net loss declined 65% to Rs 1314 crore from Rs 3768.5 crore. Total expenses for the fiscal dropped 54% to Rs 3310 crore from Rs 7214.7 crore.

The company noted that it continues to contribute to the way people view food delivery in 500+ cities across the country. Swiggy said it leverages its technology, scale, the density of restaurants, delivery network, and learnings from over 1.25 billion delivered orders to continuously improve on-demand food delivery services and develop new offerings to our customers like Concierge services and essentials on-demand.

Its latest offering Swiggy Instamart (currently live in 19 Cities) allows customers to order essentials and groceries throughout the day in 15-45 mins with a spread of over 4000 SKUs without compromising on speed. As we continue to grow within existing cities and expand into newer cities, high availability along with fill-through rates, very low cancellations, and complaints remain at the core of our operations.

"During the year under review, the COVID-19 outbreak spread rapidly leading to the Government of India implementing various measures to contain the spread of the virus including Lockdowns, restrictions on travel, social distancing, and other emergency measures. This coupled with a general fear of contracting the virus led to a significant reduction in the demand for food delivery," the company said in its annual filing.

Despite the lockdown and other restrictions, Swiggy said it continued to carry on its business activities uninterruptedly. "As the leading on-demand delivery platform in the country, we were among the first to launch a ‘No-Contact’ delivery feature on the app to enable both customers and delivery partners to maintain a safe distance. To monitor the health of our restaurant and delivery partners, we put in place several measures soon after the lockdown came into effect."

The company also said that its business has shown strong recovery through the year and has grown by 1.2x from March 2020 level and 2.2x from June 2020 levels with a strong focus on Customer Acquisition and Retention; Supply Improvements (both Restaurants and Delivery Riders) and a high bar on Experience with focussed interventions on improving Selection, Price and Convenience, and Policies for our customers as well as partners.

"As our company continued to focus on business recovery and associated Unit Economics the contribution margins improved significantly with operational efficiency, and reduction in defects. The contribution margin per order improved by 150% YoY; leading to a reduction in PBT losses by 39ppt of revenues YoY," the company said.