Loft bets on growing appetite for premium food-delivery service

Loft, a Zee5 experience, which runs a host of cafes banking primarily on interactive and experiential model, offering diners everything from Xbox to Play Station to a Smoothie Cycle, is now looking to tap the home delivery channel to stay afloat.

According to Pramod Kumar, Head of Marketing and Operations, Loft, the demand for premium delivery service for food is expected to pick up in a big way once the lockdown is lifted.

Online food delivery, though still a nascent market in India, has been growing on the back of hectic work schedules and rise in disposable income of people, especially in the urban areas. As per estimates available in pre-lockdown times, the country’s online food delivery market was estimated to grow by a CAGR of 30 per cent and generate revenues of ₹1.3 lakh crore.

“All this while food delivery has been a price sensitive market and the ticket size has been low but post lockdown we feel that there will be demand for premium delivery service in the high-end category. That is one area we plan to focus on,” Kumar told BusinessLine.

Plans are afoot to get into cloud kitchen format and have multiple brands within a single outlet in order to cover fixed costs. The brand is also looking to renegotiate rentals wherever possible.

Cloud kitchen is a concept where the cooking takes place solely to fulfill the orders received from online portals such as Swiggy or Zomato, among others.

“We had tried something like that (cloud kitchen) in our outlet in Pune and it was showing positive numbers there. We will not tamper with our existing business model but we will try to create a sub brand and have different category and varied cuisines from within the same stores,” he said.

Loft had started an online brand before the lockdown called ‘Desi Canteen’ to deliver Indian food. More focus could be laid on that brand in the days to come.

Online food delivery accounted for nearly 25 per cent of the brand’s total sales pre-lockdown. Post-lockdown, initially it might be lower as the overall revenue is likely to witness a dip. However, with addition of products, there might be a better traction.

“It (online food delivery) is an offer driven market….it is all about how you get those people to know your brand,” he said and added that the money, which was earlier spent on bringing customers to the stores, would now be shifted to online avenues.

Loft, which currently has 8 outlets spread across Bengaluru, Jaipur, Pune and Hyderabad, had planned an “aggressive expansion” this year to add 15-20 outlets on a franchisee model. However, the plan has been put on hold in the wake of the current slowdown and uncertainty due to the Covid-19 pandemic.