Order Received: Is Zomato shutting down?
is it, really?
Rumors are swirling - Is Zomato shutting down?
The short answer: no.
But the long answer? It’s complicated.
The company has announced a major shift, renaming its holding entity to Eternal while keeping the Zomato and Blinkit brands intact.
However, this move may have far-reaching consequences that could backfire spectacularly.
Let’s break it down together…
A name change that could spell trouble
📌 The Brand Identity Dilemma
Zomato is one of India’s most recognizable tech brands.
Changing the name of the holding company to Eternal creates unnecessary confusion.
Why fix what isn’t broken? Consumers associate Zomato with reliability in food delivery, and shifting to vague, abstract identity risks diluting that trust.
Take Google’s parent company, Alphabet, as an example - it never really caught on. People still refer to the entire ecosystem as Google. 📌 The Investor’s Perspective
Stock markets thrive on clarity.
Investors don’t like uncertainty, and a drastic name change often signals internal upheaval rather than confidence.
Just hours after the announcement, Zomato’s stock dipped - a small but telling reaction.
If history is any indication, companies that attempt radical brand overhauls without clear value addition often face turbulence.
Facebook’s transformation to Meta, for instance, hasn’t exactly won over the markets.📌 The Risk of Overstretching
CEO Deepinder Goyal envisions Eternal as more than just a food delivery business.
With Blinkit, Hyperpure, and other ventures under its wing, Zomato is trying to evolve into a multi-faceted tech powerhouse.
But can it truly manage all these businesses without losing focus?
We’ve seen conglomerates struggle with diversification.
Many tech giants like Yahoo and WeWork failed because they tried to be everything at once. If Zomato shifts too much attention away from its core business, it may end up spreading itself too thin.
📌 Consumer Trust and Perception
What happens when a familiar brand undergoes a drastic change?
It creates doubt.
Consumers might start questioning the company’s stability -
Is Zomato being acquired?
Is it struggling financially?
Could this be a prelude to downsizing?
Without clear communication, even minor changes can spiral into major PR nightmares.
The name Eternal might carry a powerful message internally, but externally, it risks sounding pretentious and disconnected from the company’s original mission.
📌 The Execution Challenge
Rebranding at this scale isn’t just about changing a name - it involves reworking legal documents, updating digital assets, educating stakeholders, and ensuring seamless adoption.
If not executed flawlessly, the transition could lead to operational confusion, delays, and technical glitches.
A prime example is JioMart’s messy rebranding attempt, which left customers frustrated due to inconsistent messaging. Zomato must ensure it doesn’t fall into the same trap.
So, if Zomato can’t communicate its vision effectively, it risks alienating investors, confusing customers, and stretching itself too thin.
So, that’s it for today. If you enjoyed this edition, subscribe to hear from us every day!
See ya 👋
