Shiprocket is a prominent Indian logistics and supply chain solutions company that facilitates seamless e-commerce shipping for businesses of all sizes. The company offers a platform that enables users to ship products through various courier companies. It also provides a dashboard that enables users to track and manage orders and offers an API for developers to integrate the company’s services into their own applications.
About Shiprocket
Shiprocket was founded in 2017 by Vishesh Khurana, Gautam Kapoor, Saahil Goel, and Akshay Ghulati. Since then, it has been a dependable partner in the e-commerce industry. The company’s business strategy centres on giving retailers a complete, technologically advanced platform to effectively handle their shipping requirements. Order fulfilment, shipping, and tracking solutions are just a few of the services that Shiprocket provides.
Simplifying the logistics process for online retailers is the foundation of Shiprocket’s business strategy. Because the platform interfaces with numerous courier providers, merchants may select the most dependable and affordable shipping solutions. From order processing to last-mile delivery, Shiprocket’s technology optimises the shipping process. The company serves a wide range of customers, from tiny companies to major e-commerce organisations.
How Shiprocket Makes Money?
Shiprocket combines various business concepts to generate revenue.
Generating Revenue Through Per-Shipment Charges: Businesses must pay a fee to Shiprocket for each shipment handled via their network. Logistics and shipping aggregators frequently use this kind of income, which enables them to make money according to the volume of transactions.
Generating Revenue Through Subscription Plans: Medium and big merchants can choose from membership levels offered by Shiprocket. These programmes offer advantages including priority assistance, access to numerous e-commerce channel connections, and reduced shipping costs.
Generating Revenue Through Value-Added Services: Shiprocket provides its clients with a number of value-added services, such as order management tools, shipment tracking, courier suggestions, and automatic shipping labels. While some of these services might be offered without charge, some might have an additional fee.
USP of Shiprocket
Shiprocket’s strong technological infrastructure is its unique selling point. The platform provides a wide range of services, such as automated workflows, real-time tracking, and order fulfilment. The business enables smooth integration with well-known e-commerce systems including Shopify, Magento, WooCommerce, and BigCommerce by using APIs.
Shiprocket offers sellers a smooth delivery experience by integrating with a number of online marketplaces and shopping carts.
Shiprocket uses data analytics to give sellers insightful information on their shipping performance and clientele.
Weaknesses
For the actual delivery of items, Shiprocket mostly depends on outside logistics providers (courier firms), which may result in possible service interruptions or problems with quality.
Shiprocket is under constant pressure to maintain low pricing in the very competitive e-commerce logistics business.
After a shipment is turned over to a courier partner, Shiprocket, as a platform, has little control over the delivery procedure.
Opportunities
Shiprocket can look into ways to extend its offerings into new regions, both domestically in India and beyond.
They can launch innovative services like same-day delivery, expedited shipment, or tailored logistics for particular sectors.
Synergistic opportunities may arise from partnerships with other e-commerce enablers, such as marketing platforms or payment gateways.
Threats
The current logistics environment may be upended by new technologies; therefore, Shiprocket will need to innovate and adapt to stay ahead.
Customer data security and privacy must be guaranteed, and any breaches might seriously harm Shiprocket’s brand.
Shiprocket’s growth may be impacted by a possible economic slowdown, particularly given the current conflict scenarios amongst various nations, which could have an effect on consumer purchasing and e-commerce activity.
Conclusion
In general, Shiprocket’s business strategy is predicated on offering SMBs in India economical and effective shipping options. Shiprocket has built a profitable business that supports its clients’ growth and success in the e-commerce industry by utilising its ties with logistics providers and creating an intuitive platform. The corporation should now investigate the possibilities of new markets, especially in Southeast Asia and other developing nations.
Shiprocket is an Indian logistics and supply chain platform that simplifies e-commerce shipping.
Who are the founders of Shiprocket?
Shiprocket was founded in 2017 by Vishesh Khurana, Gautam Kapoor, Saahil Goel, and Akshay Ghulati.
How does Shiprocket make money?
Shiprocket generates revenue through per-shipment charges, subscription plans for businesses, and value-added services like order management tools, tracking solutions, and API integrations.
Thinking about coffee? Yeah, me too! And when it’s about coffee, no one can beat Starbucks! The most delicious American coffeehouse and company. But what keeps this company incredibly successful?
So, to bring a better perspective to the business model of Starbucks, we have presented this article for you. Starbucks was based in Seattle, Washington, and started to nurture people with the pleasure of coffee at a time. And today, this coffeehouse is established in more than 38,000 places across the globe.
Starbucks is a choice for all! To find out what makes a company successful on a global scale, this piece will take a close look at its business ecosystem. Through this article, we will get to know all the essential strategies of Starbucks’ business model and how the company operates and makes money. We will discuss the strategies, plan, and revenue model. But most importantly, we will know what’s unique about the Starbucks business model that keeps it at the top. Let’s get started!
About Starbucks
The American-based multinational chain of coffeehouses, Starbucks, is headquartered in Seattle, Washington. Starbucks is responsible for the utmost coffee culture in the United States.
The coffeehouse was founded by Jerry Baldwin, Gordon Bowker, and Zev Siegl in 1971 (around 50 years ago). Starbucks was widely welcomed by Americans in their coffee culture. And now, Starbucks is well-established in around 38,038 places across the world, as of 2024. It serves over 83 countries worldwide. Its headquarters are in Seattle, USA.
Starbucks is well known for serving utterly delicious hot and cold drinks, whole-bean coffee, various instant flavoured coffee, including espresso, latte, and others. It also serves loose-leaf teas such as Evolution Fresh juices, Frappuccino, and many others. La Boulange pastries and other snacks as well. Moreover, Starbucks offers tons of different customer-based offers like free Wi-Fi and many others.
In 1971, on the cobblestone streets of Seattle’s iconic Pike Place Market, Starbucks was launched. In this same spot, Starbucks originally welcomed visitors with the promise of freshly roasted coffee beans, tea, and spices sourced from all corners of the globe. Its headquarters are in Seattle, USA, and the company was founded by Gerald Baldwin, Gordon Bowker, and Zev Siegl. There are currently over 38,038 outlets spread out over the globe.
Where Does Starbucks Operate?
As of 2025, Starbucks operates in around 80–83 countries with approximately 32,000+ stores worldwide.
Here’s a more detailed breakdown:
United States: Over 17,000 company-operated stores as of June 2025.
China: Around 7,700 company-owned stores, with a total push toward 9,000 by the end of 2025 .
Other key markets:
Japan: ~1,800 stores
South Korea: ~1,980 stores
Canada: ~1,483 stores
United Kingdom: ~1,354 stores
Indonesia: ~603 stores
Latin America & Caribbean: ~1,700 licensed stores.
Other regions (EMEA, Asia, etc.): Thousands more, with a focus on Europe, the Middle East, Africa, including a major footprint via local franchise partners like Alsea.
Key Products and Services of Starbucks
Starbucks mainly focuses on better interaction with its customers. Therefore, it offers its key services, such as communication, for a better connection with audiences. The bond between customers and the coffeehouse becomes very strong. And Starbucks always gets the best relationship throughout.
This also encourages a calm and relaxing environment inside Starbucks’ stores. They aim to touch the inner soul of their customers. And in such a manner, the consumers always come back for more coffee and snacks.
Target Audience of Starbucks
The world-famous chain of coffeehouses, Starbucks, targets its audience through demographic segmentation. It mainly targets people aged 25-44 years. This rounds up around half of the total business revenue.
The next large target group is young adults around the age of 18-24 years. Through these major groups, Starbucks earns a great source of revenue. And these together bring around 40% of Starbucks’ total sales.
A collection of concepts that define Starbucks and its place in the market forms the basis of the company’s business model. Providing first-rate goods and services, building strong communities, and giving customers something truly special are the fundamental elements of these concepts. Starbucks has succeeded in attracting and retaining customers by emphasising these features. It offers multiple beverages are available, including hot and cold drinks, VIA, coffee made from whole beans, tea made from entire leaves or loose leaves, lattes, fresh juices, Frappuccino drinks, and more.
Starbucks Business Model Canvas
The above image shows the business model canvas of Starbucks in detail.
Starbucks’ business model is well designed to make the business work, and also, how it can make more profit. Starbucks gathers its value through incredible customer interaction and experience.
It also sells a variety of foods such as cakes, yoghurt, salads, pastries, and more. By popularising darkly roasted coffee, Starbucks has set itself apart from other coffee firms. Starbucks’ usage of automated espresso equipment sets them apart from other coffee producers. Coffee producers and roasters are integral parts of Starbucks’ business plan.
When it comes to globalising a business, suppliers are essential allies. In order to guarantee a steady supply of high-quality coffee goods, it interacts with farmers, roasters, and shippers. In the case of items other than coffee, it collaborates with a number of regional, state, and local vendors. Starbucks’ business model relies on a distribution network that includes both company-operated and licensed locations to sell its products. In addition to these channels, it sells its products through warehouse clubs, specialty stores, grocery stores, and supermarkets. Starbucks business plan focuses on expanding company-owned and licensed stores, enhancing customer experience, and growing packaged product sales globally.
Starbucks gives people the pleasure of drinking coffee. It creates a calm and relaxing environment for its customers with great quality beverages in its coffeehouses. Starbucks has always been pretty creative in its business methods and strategies.
It offers instant, on-time delivery to its customers consistently. Now that we have the basic idea of the business model of Starbucks, let’s get our minds to what is unique about its business model and how it actually makes money.
What Is Unique About the Business Model of Starbucks?
Starbucks has opted for the most creative and unique marketing strategies. It has received immense success through its business model and strategies. But the thing that makes the business model utterly unique is the Classic Logo, which works best to engage more loyal customers throughout. The concept of the logo is to gather a huge audience base.
The other thing is how it presents its advertisements to its customers. With its store, modern cup design, digital content, and many others, it provides customers with a feeling of warmth and comfort. That’s why the audience connects more with Starbucks.
How Starbucks Makes Money | Starbucks Revenue Model
Starbucks’ company-operated outlets generate the bulk of the company’s income. Starbucks sells coffee, drinks, and snack items in its thousands of shops throughout the world, generating enormous revenue. Let’s find out the revenue streams through which Starbucks earns money.
Starbucks Revenue Streams | Starbucks Revenue Model
Part of Starbucks’ success in this sector comes from its ability to provide a pleasant and uniform experience for customers everywhere. From the welcoming decor to the warm smiles of the coffee shop employees and the scent of freshly brewed coffee, Starbucks has perfected the art of creating a welcoming and comfortable environment for its customers.
In addition, the company-operated Starbucks locations are great for more than just getting a cup of coffee on the go. People now gather there for a variety of reasons, including socialising, studying, and working. Book clubs, live music, and art exhibitions are just some of the events that these establishments frequently host. Starbucks has succeeded in attracting and retaining customers by encouraging a feeling of belonging among its patrons.
Earnings for Starbucks come from both company-operated and licensed locations. Partners who have secured a licence to sell Starbucks products run these sites. By using a licensing strategy, Starbucks is able to go into new areas and serve more customers without taking on the entire financial and operational risk of running its outlets. Using its well-known brand name, Starbucks has expanded into packaged coffee, tea, and other goods that may be found in grocery stores and on the internet. Starbucks guarantees extensive distribution and maximum availability of its packaged products through partnerships with shops and online platforms.
Number of Starbucks Stores Worldwide (2003-2024)
USP of Starbucks
Customers will have a more favorable impression of Starbucks since they know they will enjoy what they purchase. Starbucks hosts events where customers can win t-shirts, mugs, and gift cards to celebrate the opening of new outlets. To boost their “brand awareness and brand loyalty,” Starbucks depends significantly on word-of-mouth publicity.
Starbucks Competitors
Starbucks faces competition from many other big and small coffee brands around the world. Here are some of the major ones:
Dunkin’ Donuts – Famous for coffee and donuts, Dunkin’ started in 1950 and now has over 11,500 stores in 35+ countries.
Costa Coffee – A popular British coffee chain founded in 1970, now owned by Coca-Cola.
McCafé – McDonald’s coffee brand, launched in 1993, found in many McDonald’s locations worldwide.
Tim Hortons – A top Canadian brand known for coffee and donuts, with over 4,600 stores across 13 countries.
Peet’s Coffee – Started in 1966, Peet’s is known for its strong, freshly roasted coffee.
Lavazza – A famous Italian coffee brand, founded in 1895, with cafes mainly in Europe.
Café Coffee Day – India’s biggest coffee chain, started in 1996, with stores in parts of Africa, Europe, and Asia.
Local coffee shops – Starbucks also competes with thousands of small, independent cafés all over the world.
So while Starbucks is a global giant, it’s always competing with both well-known brands and cozy neighborhood coffee spots.
Starbucks SWOT Analysis
SWOT Analysis of Starbucks
Starbucks Strength
Worldwide, the term “Starbucks” draws up images of coffee shops and positive consumer experiences.
This company’s youthful clientele is a key factor in its dramatic rise to popularity and rapid expansion.
Every Starbucks is known for its great atmosphere and friendly service.
The name and symbol of Starbucks are easily remembered.
Starbucks Weakness
Many people think that Starbucks’ menu prices are too high when compared to other chains and local businesses.
In many emerging countries, including India, Starbucks is still on the rise.
There has been a shift among health-conscious consumers towards beverages with a focus on nutrition.
Starbucks Opportunities
To make coffee-based products more affordable for the target market, consider introducing more affordable alternatives.
Starbucks can explore newer markets by targeting smaller towns and cities.
Perhaps they might expand their product line to include more than just coffee. In many markets, such as the UK and India, tea is the beverage of choice.
Starbucks Threats
Competitors include already-established coffee shops and fast food joints that sell coffee with other foods.
Threats of substitute products and services include other beverage items, such as colas, teas, or liquids that are sold in retail stores.
Conclusion
Starbucks’ business model is quite known for its strategic deals and promotions. Their business model is utterly successful and always finds more customer engagement. It has a good impact through its licensed and company-operated stores. It works with simplicity and stands up to its ethics.
Today, Starbucks is a well-established company with a huge audience base. The business model of Starbucks shows that with utter determination and hard work, you can achieve everything within your reach.
FAQ
What is Starbucks business model?
Starbucks follows a premium café retail model, selling high-quality coffee, beverages, and food in a cozy, customer-focused environment. It earns revenue through company-owned stores, licensed stores, and branded products sold in retail channels.
Who is the founder of Starbucks?
Gordon Bowker, Jerry Baldwin, and Zev Siegl founded Starbucks in 1971.
Is Starbucks owned by Tata?
Tata Starbucks Private Limited is a joint venture company owned by Tata Consumer Products and Starbucks Corporation.
Who are the competitors of Starbucks?
The competitors of Starbucks include Costa Coffee, Tim Hortons, The Coffee Bean & Tea Leaf, Cafe Coffee Day and others.
How does Starbucks operate?
Starbucks operates through company-owned and licensed stores, selling coffee, food, and merchandise. It focuses on delivering a consistent, high-quality customer experience worldwide, both in-store and through packaged products sold in retail and online.
How many Starbucks are there in the world?
There are 40199 Starbucks, as of 2024 in the world.
How does Starbucks make money?
ChatGPT said:
Starbucks makes money by selling coffee, drinks, and food in its stores, earning from both company-owned and licensed outlets, and through packaged products sold in supermarkets and online.
Zomato is an Indian restaurant search, discovery, and online food delivery service. The food tech unicorn was founded by Deepinder Goyal and Pankaj Chaddah in 2008. Zomato is well known throughout the country and has also managed to venture into many international markets over the years. It currently operates in 10,000 cities in 24 countries, including the USA, India, Australia, Brazil, New Zealand, Singapore, the United States and in the Middle East Qatar.
Today, Zomato focuses on online food ordering, restaurant reservations, loyalty programs, consultant services, and a lot more. Zomato is also a food search engine that works the same as Google’s search engine but explores a wide range of food and restaurants. The company has grown from a home project to one of the world’s largest food aggregators. Zomato not only connects people to food in every context but also works closely with restaurants to enable a sustainable ecosystem.
With its unique and sustainable business and revenue model, as well as a well-defined organizational structure of Zomato, the company has managed to remain a top player in the market. Zomato has become successful because of factors such as affordability, easy accessibility, and assortment, which have built trust among people from the years of service. Zomato continues to work on finding innovative ways to serve its customers.
Zomato – History
Founders of Zomato – Deepinder Goyal and Pankaj Chaddah
Zomato, which was earlier known as Foodiebay, was established in July 2008 by two IIT graduates, Deepinder Goyal and Pankaj Chaddah. The idea first struck Deepinder when his colleagues consistently had a demand for paper menu leaflets from different restaurants to order food. That is when he thought of converting the restaurants’ paper menus to a digital app, which is far more accessible and easier to use.
In a matter of 9 months, the company grew to become the largest restaurant directory in Delhi and later expanded to other cities due to its success. By 2012, Zomato had started expanding internationally to countries like the UK, South Africa, Qatar, Sri Lanka, South Africa, New Zealand, Brazil, etc. During this course, the company had to change its name since its last four letters of ‘Foodiebay’ coincided with ‘eBay’; the company name was changed to Zomato in 2010 to avoid any legal issues.
In 2015, the company forayed into the food delivery business and went on to launch Gold in India, which was a subscription product under which subscribers would get access to complimentary food and drinks. Zomato also launched Hyperpure, which directly works with Farmers to improve the quality of food produce and supply fresh produce to restaurants. The company now views its business as a combination of three key large pillars: Delivery, Dining Out, and Sustainability.
How Zomato Works: A Simple Guide for Customers & Restaurants
How Zomato Works
Search Restaurants: Open the Zomato app or website, enter your location, and explore restaurants by cuisine, name, or deals nearby.
Check Details: Click on a restaurant to see its menu, prices, photos, reviews, hours, and delivery information, all in one place.
Place Your Order: Pick your favorite dishes, customize them to your liking, and add them to your cart.
Make Payment: Pay easily via card, net banking, wallet, or even cash on delivery (if available).
Track Delivery: Once the order’s confirmed, the restaurant prepares your food, and a Zomato delivery partner brings it right to your door. You can track the delivery in real-time.
Leave a Review: After your meal, rate the restaurant and share your feedback to help others.
Zomato also helps users discover new places and gives restaurant owners tools to manage their listings, menus, and reviews.
Zomato – Business Model
Zomato Business Model Canvas
During the initial phase of the company, Zomato used to scan the menu of the restaurants and keep it on the site, and the menu was received by people. It still follows the same formula but has also added other services to its operation. The business model of Zomato is quite different from that of other food delivery such as Swiggy and Foodpanda. The key partners of Zomato are Uber and London & Partners, which could launch Zomato in the UK within the expected timeline. The business plan of Zomato focuses on expanding its food delivery network, enhancing customer experience, and generating revenue through restaurant partnerships, advertisements, and subscription services.
While the company’s key resource is its large database of restaurants across 10,000 cities in 24 different countries, the business model is based on providing local restaurant search services, collecting data on food menu contacts, and providing relevant information to their customers. The main channels for Zomato are mobile applications and its website. The target audience of the company is the users who try to find local restaurants of various cuisines and restaurants who want their name to reach a large number of people. The Zomato working model is built around connecting customers with restaurants through online food ordering, delivery services, and real-time tracking.
Zomato also caters to customers who prefer home delivery; it helps out database and market research of companies. At the same time, the online service is built with a mandatory rating mechanism. Zomato’s business model has revolutionized the food industry by incorporating various restaurants and making it convenient for people to find restaurants, provide feedback, and food business industries by incorporating various listings and availability according to their choice of cuisine.
Zomato – Expansion & Impact
Zomato employs over 5,000 individuals, spanning diverse roles and compensation levels.
The monthly user base is 80 million users.
Zomato continually expands its platform, adding a new restaurant every 30 seconds.
Presence established in 24 countries.
Available in multiple languages, including Turkish, Portuguese, Indonesian, English, Hindi, and some regional Indian languages.
Zomato – Revenue Model | How Zomato Earns Money
Zomato Financial Snapshot
Zomato Yearly Financials
Particulars
FY24
FY23
Total Revenue
12,961 crore
7,760.9 Cr
Revenue from operations
INR 12,114 crore
INR 7,079.4 crore
Other income
INR 847 crore
INR 681.5 crore
Profit/(Loss) before tax
INR 291 crore
(INR 1,014.6 crore)
Tax expense
(INR 60 crore)
(INR 43.6 crore)
Current tax
INR 1 crore
INR 0.4 crore
Deferred tax
(INR 61 crore)
(INR 44 crore)
Profit/(Loss) for the year
Profit of INR 351 crore
Loss of INR 917 crore
Zomato, in itself, does not offer the products to customers, but the revenue model of Zomato is massive. Zomato is not just a food business; it is also in the advertising business. Zomato turnover has seen significant growth over the years, reflecting the company’s expanding presence in the online food delivery market. Zomato’s business has two parts: one is the delivery business, and two is the advertising business. Today, Zomato has multiple revenue streams besides online ordering, which most consumers would be familiar with. Zomato’s profit for the year 2024 was INR 351 crore.
Zomato Expense Breakdown
Zomato Expense Breakdown
FY24
FY23
Total Expenses
INR 12,670 crore
INR 8,775.3 crore
Purchase of stock-in-trade
INR 2,887 crore
INR 1,438.2 crore
Changes in inventories
(INR 5 crore)
(INR 43 crore)
Employee benefit expense
INR 1,659 crore
INR 1,465 crore
Finance costs
INR 72 crore
INR 48.7 crore
Amortization & Depreciation
INR 526 crore
INR 436.9 crore
Other expenses
INR 7,531 crore
INR 5,429.5 crore
Zomato saw growth in FY24, with its operating revenue increasing by 70.8%, reaching INR 12,114 crore compared to INR 7,079.4 crore in FY23. The company also turned profitable, posting a profit of INR 351 crore in FY24, compared to a loss of INR 917 crore in FY23. However, total expenses increased by 44.4% to INR 12,670 crore in FY24, up from INR 8,775.3 crore in FY23.
Restaurant Listings and Advertising
Zomato first started as a restaurant search and rating service. This brought in the advertising revenues from restaurants who joined the platform. They further extended this feature to food delivery and restaurant reservations; for this, Zomato charges commissions from restaurants that want to be placed on the feed. Advertising is Zomato’s major source of revenue. The restaurants can promote their banner on the site in order to get better visibility and appeal to a large section of the audience via Zomato.
Food Delivery
Zomato Revenue Model – Food Delivery
Through the food delivery business, Zomato charges a commission to the restaurants based on orders. The company earns through restaurants that pay a commission for each delivery, which is then split among the delivery partners and the company. Zomato imposes a commission ranging from 20% to 25% on each order made at a specific restaurant, with potential variations in commission rates from 5% to 7% in certain regions. However, online food delivery only contributes a low percentage of income compared to other revenue streams because of the huge competition and the need to provide deep discounts.
Subscription Programs
The next major source of revenue for Zomato is a subscription fee. Restaurants pay a certain fee monthly; in return, Zomato offers them the analytical tools. Zomato has a huge number of databases that know what a customer wants to eat, where he/she wants to eat, and what the consumers are searching for, and itis given to restaurants, which helps them know about all this information through the cookies. It has a tool called Zomato Order which is given to restaurants, which tells them about consumers’ interests. The restaurants then use this tool to flash their discount offers on food.
Live Events
Zomato Revenue Model – Zomaland
Zomato has forayed into the events space by partnering with restaurants and creating limited events. By which they made a sale through the price of the tickets. Zomato recently introduced Zomaland and entered the live event market in 2019. Zomato charges users an entry fee to attend Zomaland, where, besides food, they can witness live musical performances and other acts. Zomato also organized an entertainment carnival in 2018 in Delhi, Pune and Bengaluru, where more than 100 thousand people showed up.
White Label Access
The next source of revenue is app development. Zomato launched a service called Zomato Whitelabel, under which they give offers to restaurants to develop customized food delivery apps. It also works with cloud kitchens and restaurants for consultancy services. Zomato works with selected restaurant operators to help in identifying locations for expansions at a minimal fixed cost but with increased options for the user. It provides the requisite licenses and operational enablement for such restaurant partners.
Zomato studies how people use its app and how restaurants perform. It shares this information with restaurants and others in the food business. This helps restaurants improve their menu, prices, and promotions. Zomato also uses the data to make its app better. It earns money by charging a fee for sharing this data.
Zomato Kitchens
Zomato also provides kitchen infrastructure services to select restaurant operators; it works with entrepreneurs to set up and operate Zomato kitchens under various other labels. This helps entrepreneurs fund restaurants in the right location with an investment of INR 35 lakhs. It also claims to offer returns in the range of INR 2 lakh to INR 4 lakh per month to investors and has so far completed more than 180 affiliated kitchens.
Zomato Gold
Zomato Revenue Model – Zomato Gold
Zomato Gold is a premium subscription service offered by Zomato, providing members with exclusive dining benefits. Subscribers enjoy complimentary dishes or drinks at partner restaurants, making dining out a more rewarding experience. The service aims to enhance the dining lifestyle by offering special privileges and discounts at a wide range of top-rated eateries. Zomato Gold caters to food enthusiasts seeking unique culinary experiences while enjoying cost-effective perks. It has become a popular choice for those who appreciate both quality dining and savings.
The total revenue generated by Zomato in FY 22 was INR 4192 crore whereas its turnover in FY 2023 was INR 7079 crore.
The business model of Zomato offers a variety of value to its customers, while Zomato’s revenue model focus has been on creating something new and extra that the customers cannot get anywhere else. Zomato is a one-stop shop for dinners and offers a way for restaurants to differentiate themselves. Restaurants have an option to create differentiation by keeping the listing updated, responding to criticism positively, and also by being accountable for their action.
Zomato’s business plan believes in creating value for its customers to sustain its business operations. The company endeavors to bridge the gap between customers and restaurants by providing efficient technology applications, which, as outlined in the business plan, has played a crucial role in reducing delivery times and enhancing overall service quality. Zomato business plan focuses on food delivery, restaurant listings, and data insights to create a profitable and scalable model in the food tech industry.
FAQs
What is Zomato?
Zomato is an online platform that offers food delivery and helps users discover restaurants with various dining options available.
What is Zomato Business Model?
Business model of Zomato is a commission-based model, charging restaurants a percentage fee for orders through its platform. Revenue is generated via subscription services, including Zomato Gold, which grants exclusive dining benefits.
How Zomato works?
Zomato connects users with restaurants by allowing them to browse menus, read reviews, and order food for delivery or pickup. It also offers table reservations and subscription services like Zomato Pro for discounts. Restaurants can list their services and manage orders through the platform.
What is the revenue of Zomato?
Zomato’s revenue is ₹12,961 crore (2024).
How to contact Zomato for business?
You can contact Zomato through email to start a business with them.
What is Zomato for business apps?
The Zomato for Business app is for business owners. It is an interface with powerful features to get the most out of your Zomato listing.
Zomato operates in how many countries?
Zomato operates in 10,000 cities in 24 countries, including the USA, India, Australia, Brazil, New Zealand, Singapore, the United States, and in the Middle East Qatar.
What is Zomato revenue model?
Zomato’s revenue model is based on several key sources. It earns a commission from restaurants for each food delivery order placed through its platform. Additionally, Zomato generates income from advertising by allowing restaurants to pay for premium listings and visibility. The subscription service Zomato Pro brings in revenue from users who access discounts and exclusive deals. Zomato also makes money through Hyperpure, which supplies quality ingredients to restaurants. These revenue streams help Zomato sustain and grow its business.
What are Zomato products and services?
Products and services offered by zomato include food delivery, restaurant discovery, and table reservations. It allows users to explore local dining options, read reviews, and place orders online. Zomato Pro offers members discounts at partner restaurants, while Hyperpure supplies fresh ingredients to restaurants. These services help Zomato connect customers with restaurants and enhance the dining experience.
In an arena where the digital economy is blossoming, messaging apps have evolved beyond simple communication tools to become platforms for commerce and content sharing. Among them, Telegram, founded by Pavel Durov, has distinguished itself through a unique combination of speed, security, and privacy.
Telegram is amazingly free and open-source software that offers tons of facilities, such as cloud-based instant messaging, end-to-end encryption, and many others. Telegram offers its users dozens of interesting features. They can create their sticker sets as well as create bots. The users can create or join different channels that provide tons of fascinating content for users to subscribe to.
Telegram does not believe in selling ads for promotion because the personal data shared with advertisers could go against its ethos. That’s why all the funding for Telegram comes directly from Pavel Durov. In case of increasing the revenue number, Telegram would begin users’ donations funding or the freemium model.
In June 2022, Telegram switched to freemium when it introduced paid subscriptions. Additional features, such as double the number of channels they could follow, faster download speed, and premium stickers, were provided to the paying users. Reducing fees and taxes, the in-app revenue of the platform exceeded $1 million in October 2022. The largest share came from iOS users.
Telegram Monthly Active Users
Telegram is a company that operates in fair secrecy and prioritizes its affirmation of freedom from any pressure that could come from the market or any other nationally assigned restrictions. Telegram has gained immense popularity among its customers in many countries across the globe.
The question of how Telegram earns money is particularly intriguing, given its steadfast approach to user privacy and ad-free experience. This insight adds a compelling layer to the app’s business model, setting it apart from competitors and making it a fascinating subject for analysis. This article is all about the intricacies of Telegram’s fiscal strategies, offering insights into how Telegram works and how it earns money without compromising its core principles. Furthermore, we shall also look at the challenges and risks associated with this approach, providing a comprehensive overview that sheds light on the financial underpinnings of one of the most innovative messaging platforms today.
The very popular open-source messaging application, Telegram, provides various facilities to its customers, including file sharing, VoIP, end-to-end encryption on video calls, and many others. Telegram was founded in August 2013 by Nikolai Durov and Pavel Durov. The company is headquartered in London, United Kingdom, and Dubai, UAE, and is operational. Telegram is the highest preferred messaging application in Uzbekistan and Iran. Today, Telegram has over 700 million active users.
In 2023, Telegram reached around 1 billion downloads, ranked by worldwide downloads, and is the 7th most popular non-gaming app in Google Play. Telegram is an open-source application, but its server is closed-source. More than 15 billion messages are sent through Telegram every day.
Here’s a more detailed look at Telegram’s growth:
March 2014: 35 million users
April 2020: 400 million users
April 2022: 500 million users
July 2023: 800 million users
March 2025: 1 billion users
Telegram has experienced remarkable growth, expanding its user base from 35 million in March 2014 to 800 million by July 2023—a surge of over 2185%. Notably, the platform doubled its users from 400 million to 800 million between April 2020 and April 2022 alone.
Telegram provides its server, which is distributed to five data centers located in various regions to minimize the company’s data load. The operational centers are established in Dubai, United Arab Emirates. Meanwhile, the legal center was established in London, United Kingdom.
Telegram’s business model stands out in the competitive scene of messaging apps by focusing on user-centric features and robust privacy measures. This approach not only differentiates it from other platforms but also highlights its unique selling propositions (USPs) that make it a powerful tool for users worldwide.
Telegram Business Model | How Telegram Makes Money
Telegram’s business model is entirely based on users’ convenience and features. The company was founded in 2013, but it hasn’t generated much revenue. Back in 2018, Telegram revealed its intentions to create its blockchain network called Telegram Open Network (TON), as well as a cryptocurrency token called Gram. The goal of this project was to transform the way people communicate online by providing a secure and decentralized platform for various applications, including payments. Through an Initial Coin Offering, Telegram raised more than $1.7 billion. But later, in 2019, the SEC stopped this plan and announced it was unlawful (The SEC alleged that Telegram’s Gram tokens were unregistered securities and that the company had violated securities laws).
After this, the co-founder Durov kept the company up with the money he earned from selling the VK stake he owned.
But lately, Telegram has experienced immense growth because of this, the company has monetized the service. In 2020, Telegram’s CEO, Durov announced on his public Telegram channel that they would be monetizing Telegram’s services.
Telegram would not charge any cost to the users, nor would it show any ads in private or group chats. That’s why Telegram is looking forward to other methods to gain enough revenue.
Telegram Boosts Business Model with Premium AI Bot Automation
Telegram’s latest update strengthens its business model by expanding automation features for Premium Telegram Business accounts. Businesses can now integrate third-party bots—including AI-powered ones—to handle messaging, profile updates, transactions, and story posting. These bots can be granted granular permissions, such as managing messages or editing posts, enhancing workflow automation for business users. This focus on advanced automation and premium business tools highlights Telegram’s strategy to monetize its vast user base through paid subscriptions and value-added services tailored for enterprises and professional users.
User-centric Focus – The X Factor
Telegram has been pretty vocal about its emphasis on user convenience and a feature-rich experience. Unlike many other messaging apps, Telegram was not designed with profit generation as its primary goal. Instead, the platform focuses on providing a seamless and enhanced messaging experience. This is evident from its introduction of innovative features such as chat folders, message scheduling, and the ability to edit sent messages, which significantly enhance user convenience. The platform’s dedication to maintaining an ad-free environment in private chats underscores its commitment to user experience over revenue generation. BTW, there’s a Telegram X as well for people who love flexibility. Phew!
Privacy Is Precious, Indeed
Telegram’s approach to privacy is revolutionary and forms a core part of its business model. The platform offers end-to-end encryption for private conversations, ensuring that only the communicating users can access the messages. Telegram’s stringent data protection policies are highlighted by its record of disclosing zero bytes of user data to third parties, including governments. This commitment is further supported by features like two-factor authentication, self-destructing messages, and customizable privacy settings that allow users to control who sees their profile information and messaging status.
Feature Set, Spoil Them With Options
Telegram’s array of unique features significantly contributes to its standing as a preferred messaging app. The platform supports a multitude of user-friendly features, such as the ability to send silent messages, which do not disturb the receiver, and the option to delete messages for all participants long after they have been sent. Additionally, Telegram offers advanced security features like passcode and biometric locks for individual chats, enhancing personal security. The app’s ability to handle large groups and broadcast channels effectively, coupled with minimalistic, privacy-conscious sponsored messages, provides a balanced approach to user engagement and platform monetization.
Telegram, thus, not only ensures a high level of user satisfaction but also aligns with the growing global demand for digital privacy and secure communication. This strategic focus on user benefits over direct profitability sets Telegram apart in the digital communication space, making its business approach a powerful example of innovation and user-first orientation in technology.
What Is Unique About the Business Model of Telegram
Telegram runs on a very smooth business model, and the most unique thing about it is that Telegram wasn’t made to make a profit. The messaging application Telegram was founded to make messaging handy for users with many fascinating features. It has a whole bunch of features that make it unique from the other applications. These features are:
Telegram offers the option of editing the text after sending it. You can also delete them from both sides at your convenience.
You can access your messages anytime from any device through the availability of a cross-platform.
Options for replying, hashtags, and mentioning to make your chatting more fruitful.
A feature to mute any group so that you don’t get unnecessary notifications.
A feature to pin any message, which will be displayed at the top of the chat screen.
Share any file with a maximum size of 2GB ormore.
How Does Telegram Make Money | Telegram Revenue Model
Telegram Revenue (In-App Purchases)4GB
Telegram does not make any profit from its application and services. In 2020, there was zero revenue made. The founders believe in providing fast and secure messaging. Telegram does not believe in selling ads for promotion because the personal data shared with advertisers could go against its ethos. Telegram. In June 2022, Telegram launched Telegram Premium, a subscription model that offers extended limits, faster download speed, and larger file uploads.
Although the company does have backup plans in case of urgent money, Telegram would look for non-essential paid options to generate money. Telegram prioritizes its customers the most and provides them with the best features for free. Telegram usually makes money from its founders, which is a significant source of income. Telegram also started offering a variety of in-app purchases, such as premium stickers and emoji packs. These purchases generate revenue for Telegram through the App Store and Google Play Store.
Current Revenue Streams
Telegram has innovatively expanded its revenue streams, adapting to the evolving digital verticals while maintaining its user-centric philosophy.
Telegram Revenue Streams
Here’s a closer look at the primary sources through which Telegram generates revenue:
In-app Purchases
Telegram introduced “Telegram Stars,” an in-app payment system that allows users to buy digital goods and services within the platform’s mini-apps, such as games and productivity tools. This system not only enhances the user experience by integrating a seamless transaction process but also adheres to the digital product sale guidelines of major app stores. Users can purchase Stars directly in the app and use them for a variety of digital products, enhancing engagement within the Telegram ecosystem. Additionally, these Stars can be converted to TON, the native token of The Open Network, through the Fragment exchange, highlighting Telegram’s innovative approach to in-app purchases.
Premium Subscriptions
Telegram Premium, launched as a voluntary subscription service, offers users additional exclusive features while supporting the app’s development. Features like doubled limits, 4GB file uploads, and advanced chat management are just a few of the benefits that enhance user interaction and platform utility. This subscription model is part of Telegram’s sustainable monetization strategy, driven by user contributions rather than traditional advertising, allowing the platform to remain independent and prioritize user privacy and satisfaction.
Sponsored Messages
The Telegram Ad Platform facilitates the creation of sponsored messages displayed in large public channels with over 1000 subscribers. These messages are designed to increase audience loyalty and boost brand engagement without disrupting the user experience. Sponsored messages on Telegram are unique as they do not contain external links; instead, they direct users to the brand’s channel, fostering a more immersive interaction. This method of advertising emphasizes content quality and relevance, aiming to build long-term trust and loyalty among users.
Through these diversified revenue streams, Telegram continues to thrive as a powerful messaging platform, balancing profitability with its commitment to user privacy and satisfaction. The strategic implementation of these monetization methods underscores Telegram’s unique business approach, setting it apart from other messaging apps in the market.
Here’s a detailed overview of Telegram’s global downloads on the App Store and Google Play since 2017:
Telegram App Downloads
Key Features of Telegram
Telegram offers tons of features to make messaging convenient for users. Some of the features are-
Lock Chat – where you can lock any of your chats with a password.
Self-destructing Media – where you can put a timer on any of your media, and it will be destroyed after that specific time.
Two-step verification – where you can protect your account from being hacked with two steps of verification.
Delete sender’s messages – where you can delete any message or chat from both sides (receiver and sender).
Telegram Premium – It is a paid version of Telegram that includes exclusive additional features. Telegram Premium features with a higher upload size, fast download speed, Premium Stickers, Advanced Chat Management, and more.
Telegram offers dozens of features and user preferences. The Telegram app is specially designed for people above the age of 16 years, with no parental controls overhead. This messaging application targets the youth with many end-to-end encrypted features.
Comparison with Other Messaging Platforms
Revenue Models of Other Apps
When comparing Telegram to other messaging platforms like WhatsApp, the revenue models reveal distinct approaches. WhatsApp, owned by Meta, primarily utilizes the WhatsApp Business API to support businesses in automating communication and managing customer interactions effectively. This includes features like approved message templates and conversational chatbots, which enhance the customer experience by personalizing interactions based on the user’s profile. Additionally, WhatsApp introduced a payment feature in India, allowing direct bank transfers within the app, ensuring secure transactions without storing sensitive financial data.
In contrast, Telegram focuses on user contributions and minimal advertising through its unique features, such as Telegram Premium and sponsored messages. Telegram Premium offers enhanced capabilities for a subscription fee, while sponsored messages in large public channels provide a non-intrusive advertising option, aligning with Telegram’s user privacy commitment.
User Privacy and Data Handling
Privacy and security are paramount in today’s digital communication industry. Telegram and WhatsApp both offer end-to-end encryption, but their implementation differs significantly. WhatsApp encrypts all communications by default, ensuring that only the communicating users can access the content. However, its backups stored on cloud services are not encrypted, which could pose a security risk.
Telegram, on the other hand, provides optional end-to-end encryption through its “Secret Chats” feature, which is not enabled by default. Regular chats use client-server encryption and are stored on Telegram’s servers, accessible across multiple devices. This flexibility is appealing to those who prioritize convenience but raises concerns for users seeking stringent privacy measures. Telegram’s commitment to user privacy is further emphasized by features like self-destructing messages and customizable privacy settings, which are not as prevalent on WhatsApp.
Market Positioning
The market positioning of Telegram and WhatsApp reflects their differing priorities and user base appeal. WhatsApp’s widespread adoption and default encryption make it a preferred choice for everyday users seeking reliable and straightforward communication. Its integration into the broader Meta ecosystem also provides seamless connectivity with other services, appealing to a vast global audience.
Conversely, Telegram appeals to users who value privacy, flexibility, and extensive features. Its ability to handle large groups and channels, coupled with robust file-sharing capabilities (supporting files up to 2GB), positions it as a versatile platform suitable for both personal and professional use. Telegram’s design and open API also attract tech-savvy users and developers looking for a customizable and secure messaging environment.
Both platforms have carved niches that cater to specific user needs, whether it’s enhancing user privacy or integrating business functionalities. The choice between Telegram and WhatsApp often depends on the user’s priorities, such as default security features versus flexible privacy controls and rich feature sets.
Most Popular Global Mobile Messenger Apps as of February 2025, based on Number of Monthly Active Users
As of February 2025, WhatsApp leads the global messaging space with 2 billion monthly active users, reflecting its deep penetration in international markets, especially outside the U.S. In comparison, WeChat reported over 1.38 billion users, and Facebook Messenger had around 947 million users globally. The rise of instant messaging services—allowing real-time text communication over the internet—has been fueled by the widespread adoption of smartphones and mobile apps. These platforms have evolved far beyond simple text, now offering group chats, multimedia sharing (images, videos, audio), and interactive features like stickers and emoticons, making them versatile tools for both personal and professional communication.
Telegram’s steadfast focus on privacy and security, while a significant unique selling proposition, also brings forth substantial regulatory challenges. The platform’s commitment to user privacy and its encrypted communication services limit its ability to regulate content effectively. This has led to controversies, especially when governments demand oversight over illegal activities. The absence of a clear procedure for moderating public channels based on government requests can lead to speculation and uncertainty about Telegram’s operations, potentially affecting its reputation and user trust.
Competition
In the competitive circles of messaging apps, Telegram faces formidable opponents like WhatsApp, Viber, and Slack, each with its own set of advanced features and user base. While Telegram prioritizes privacy and speed, its competitors often integrate more comprehensive business tools and broader ecosystem connections, which might attract a segment of users looking for more than just secure messaging. Balancing innovation in privacy with competitive features that appeal to a broader audience remains a critical challenge for Telegram.
Sustainability Concerns
Despite its popularity, Telegram’s business model, which prioritizes user convenience over profit generation, raises sustainability concerns. The platform’s reluctance to monetize through traditional methods like advertising or data selling, while admirable, means it must rely on alternative revenue streams such as optional paid features and in-app purchases. This approach may not sustain the financial needs required for scaling operations and developing new technologies. Furthermore, its historical lack of revenue generation as of 2020 puts additional pressure on the platform to find viable long-term financial strategies without compromising its core values.
Conclusion
By weaving together innovative in-app purchases, a premium subscription model, and non-intrusive sponsored messages, Telegram has carved out a unique niche. It has demonstrated that a business model can thrive on principles that prioritize user benefits over sheer profit, highlighting its unique selling proposition (USP) as a haven for secure and private communication. This strategic focus has not only distinguished Telegram among its peers but has also set a benchmark for integrating user-centric values with sustainable monetization strategies in the tech industry. Looking ahead, Telegram’s approach hints at broader implications for messaging platforms and digital businesses at large. Its ability to generate revenue while steadfastly maintaining its core commitments presents a powerful case study on the potential harmonization between user privacy and business growth. Telegram’s model, underscored by a veteran understanding of business intricacies and a deep commitment to research-backed solutions, sets a compelling precedent for future innovation in technology, privacy, and user engagement.
Telegram is a privacy-focused secure messaging application that has grown immensely in the last few years. There’s a lot to talk about when it comes to Telegram. For now, we have the best knowledge regarding its business model.
FAQs
What is the Telegram App?
Telegram is a cloud-based, cross-platform instant messaging service that offers fast, secure messaging, groups, channels, bots, and secret chats.
How much is Telegram’s revenue?
Telegram does not make any profit from its application and services. As of 2020, there is zero revenue made. However, they have started their in-app purchases worldwide and generated 6.1 million U.S. dollars in February 2024.
Who is the founder of Telegram?
Pavel Durov and Nikolai Durov founded Telegram in 2013. Pavel Durov is also Telegram’s CEO.
Who is Pavel Durav?
Pavel Durav is the co-founder and CEO of Telegram.
Is Telegram an Indian app?
No, Telegram was created by a Germany-based tech organization – Durov Software Industry.
Which is the best alternative to Telegram?
Signal messaging app is the best alternative to Telegram.
Who are the top competitors of Telegram?
Telegram’s top competitors include:
Viber
Signal
WhatsApp
Slack
Intis Telecom
How Telegram earn money?
Telegram makes money through various methods such as affiliate marketing and referral programs. Channel or group administrators can share affiliate links or referral codes, earning commissions for every purchase or sign-up made through these referrals.
What is Telegram business model?
Telegram’s business model includes earning from in-app purchases, advertising, promotions, and forming partnerships and collaborations. This model supports the provision of free services to users while also funding its operational needs and promoting growth.
How can businesses utilize Telegram?
Businesses can use Telegram by integrating bots that automate message processing and responses. These bots facilitate the integration of existing tools and workflows, or the implementation of AI assistants to manage communications within the platform.
Can you legitimately earn money using Telegram?
Yes, earning money on Telegram is legitimate. Channel owners can profit through sponsored posts and advertisements. The income from these sources varies depending on the number of subscribers and their engagement levels in the channel.
Is Telegram profitable?
No, Telegram is not yet profitable but is generating revenue through Premium subscriptions, in-app purchases, and sponsored messages.
How to make money on Telegram?
You can make money on Telegram by creating channels or groups to sell products, offer paid content, or promote services. Many creators also earn through sponsored posts, affiliate marketing, or by building mini-apps that use Telegram’s in-app currency, Telegram Stars.
If you are an adventurer, a good pair of sneakers is a must for you in your life. The best part is that it can be worn with any kind of clothes that you decide to deck up with. You can never go wrong with sneakers as they are comfortable and stylish enough to lift your style quotient. Sneakers can be worn with almost anything; they are extremely versatile, and the comfort that they provide is unmatched.
When we talk about sneakers, sports shoes, apparel, or sportswear, two prominent brand names ring almost together. They are none other than Nike and Adidas. These two renowned multinational corporations from two different continents – the USA and Europe- have been hot favorites in the category of sneakers and sportswear forever. Almost everyone has an idea or has at least heard of these two brands. Furthermore, growing in the same niche, Nike and Adidas have always been obvious competitors/rivals in their space. Both of them focus on sportswear, and the shoes are what they specialize in. However, over the years, both the US and German sports labels have maintained two recognizable brands around the world. Yes, financially, Nike is known to be much larger than Adidas, but the latter’s performance has been better over recent years.
Both companies have a long history of producing high-quality athletic gear, footwear, and accessories, and have gained a loyal following of customers who appreciate their commitment to innovation, performance, and style. But when it comes to choosing between these two powerhouses, which one comes out on top?
In this blog, we will explore the differences between Adidas and Nike, taking into account factors such as history and growth, technology, business model, plans, and more. Whether you’re a seasoned athlete or just looking for stylish casual wear, this comparison will help you determine which brand (Nike or Adidas) is the better fit for you.
Adidas vs Nike
Comparison Between Nike and Adidas:
Category
Nike
Adidas
Founders
Phil Knight (track athlete) and Bill Bowerman (track coach) in 1964
Adolf Dassler and Rudolf Dassler in 1924 (split in 1949; Adidas by Adolf)
Origin Name
Originally “Blue Ribbon Sports”; renamed to Nike in 1971 (named after the Greek goddess of victory)
Originally “Dassler Brothers Shoe Factory”; renamed to Adidas in 1949
Trademark Tagline
“Just Do It” (introduced in 1988)
“Impossible is Nothing” (launched in 2004)
Brand Image
Youthful, innovative, performance-driven, with a strong celebrity-athlete focus
Classic, sustainability-oriented, comfort and heritage-driven
Product Quality
Known for cutting-edge technology, performance features, and durability
Known for comfort, style, classic appeal, and performance for athletes
Founded in 1964 as Blue Ribbon Sports, officially changed to Nike in 1971.
Founded in 1949 in Germany, became a global brand in the 1970s and 1980s.
Growth
Rapid growth in the 1970s and 1980s with the introduction of innovative technologies such as Air cushioning and the “Just Do It” advertising campaign.
Strong growth in the 1970s and 1980s with the introduction of classic designs and innovative technologies.
Market Expansion
Strong presence in North America and Europe, as well as growing markets in Asia, Africa, and South America.
Strong presence in Europe and North America, as well as growing markets in Asia and South America.
Adidas History and Growth
Adidas is the largest sportswear manufacturer in Europe and the second-largest in the world after Nike. Formerly known as “The Dassler Brothers Shoe Factory”, the company was founded by Adolf Dassler and Rudolf Dassler in 1924. The founders, being sports enthusiasts, began to make sport-oriented shoes that could improve the performance of athletes in any sport.
Later in 1949, the two brothers broke their relationship, which led to the creation of Adidas by Adolf Dassler and Puma by Rudolf, making them the biggest business rivals at that time. Adidas was named after the initials of Adolf Dassler’s while the logo of three stripes was taken on as a shoe design on the company’s shoes for better comfort.
In the 1970s and 1980s, the company continued to grow with the introduction of innovative technologies and a strong commitment to sustainability. In the 1990s and 2000s, Adidas expanded into international markets and made several acquisitions to further strengthen its position in the sportswear industry.
In 2017, Adidas made an annual revenue of 21 billion euros and had a brand value of 16 billion U.S. dollars in 2024. In the same year, Adidas employed 5,888 people worldwide and generated 50% of its sales in the footwear category. Adidas is much smaller than Nike in terms of what its customers are looking for and trying to find a bigger audience in North America. With their motto “Impossible is nothing,” Adidas’ net revenue as of 2024 is €23.7 billion.
💡
Adidas was started by two brothers – Adolf (“Adi”) Dassler and Rudolf Dassler began the company together before splitting; Rudolf went on to create Puma.
Nike History and Growth
Nike is an American multinational company that is the world’s largest athletic shoe and apparel manufacturer and supplier. Originally known as “Blue Ribbon Sports,” it was founded by Bill Bowerman and Phil Knight, who was a track athlete in 1964 before becoming Nike in 1971. The name was taken from Nike, the Greek goddess of victory. The company was first established as a distributor for the Japanese shoemaker Onitsuka Tiger. Bowerman then made his first shoe for Otis Davis, who later went on to win two Olympic gold medals in 1960.
Blue Ribbons Sports sold 1300 pairs of Japanese running shoes with a gross of $8000. Its first advertisement gave its tag name as “There is no finish line,” which was changed to “Just do it” in 1988. As per the statistical records of 2024, Nike’s revenue is $51.362 billion and leads the world as the number one brand in the sports business.
Nike experienced rapid growth in the 1970s and 1980s with the introduction of innovative technologies such as Air cushioning, as well as the “Just Do It” advertising campaign. In the 1990s and 2000s, the company continued to grow through international expansion and acquisitions of other brands.
When it comes to Nike, it is the most valuable sports brand in the world, especially in North America. Unlike Adidas, Nike’s first target audience is the people of North America, and they also have strong marketing and sponsorship agreements to back it. Making it the reason behind Nike getting 30.57 billion euros in revenue in 2017. In 2006, however, Nike was still the leader with 13.44 billion euros while Adidas made 10.08 billion euros. In 2015, Nike also won the bet against Adidas and became the next exclusive provider of uniforms to the NBA. Nike’s total global revenues were reported to be $51.36 billion as of 2024.
ZoomX is a cushioning foam developed by Nike that is used to provide lightweight, responsive, and durable cushioning in running shoes.
Boost technology is a cushioning system used in Adidas sneakers to provide energy return and comfort.
Material
ZoomX is a foam material made of a proprietary blend of foam materials.
Boost is made of thermoplastic polyurethane (TPU) pellets that are fused to form a foam.
Nike Technology
Nike uses lighter materials to make its shoes lightweight, and they are made of polyester, rubber, and cotton. With that, it uses ZoomX technology, so that consumers can experience good speed while running. Nike shoes have holes in their toe cap, which makes them breathable and hygienic for feet as well. Nike shoes provide amazing designs. Nike does make more business than Adidas, but the customer reviews have deteriorated, and there has been no innovation that has been as big as Yeezy’,s which is under Adidas.
Adidas Vs Nike – Comparison between Adidas Ultra Boost and Nike Air VaporMax
Adidas Technology
Adidas always believes in putting quality over quantity and gives more importance to customer satisfaction. Adidas talks to many athletes about their preferences and comfort to implement them into their design. This was the reason for them to innovate Boost technology, which is an innovative cushion technology that includes a TPU (Thermoplastic Polyurethane) that compresses under pressure.
Adidas shoes weighed a little more than Nike shoes. The shoes consist of a full-length midsole and make it feel like a cushion-type material is present while wearing them. It focuses more on comfort and gives out more energy on every single stride. It also provides run-toe padding for its shoe models for comfort. This instantly bounces back to its original form, and in shock prevention, which helps the athlete in a more consistent run. Some of the famous shoes made by Adidas are the Y-3 collection, Ultra Boost, Gazelle, Supernova, etc.
Nike operates on a wholesale model, where it sells its products to retailers, who then sell them to consumers. Nike also sells directly to consumers through its own retail stores and e-commerce platform.
Adidas operates on a mix of wholesale and direct-to-consumer models, where it sells its products through retailers, its retail stores, and its eCommerce platform.
Nike Business Model
Nike is a leading sports apparel manufacturer that has ruled the industry for some decades now. The main focus of Nike has been an aggressive approach toward building strong and promising networks and partnerships with celebrity athletes. To quote an example, the exclusive contract that the company bagged with Michael Jordanwhen the latter signed it in 1984. This grew to be one of the most iconic partnerships in the sportswear industry and has benefited both of them. On one hand, Michael Jordan witnessed tremendous growth in his net worth, and on the other hand, it gave Nike a lead and a total monopoly in the basketball sneaker business. Besides, it also helped increase the overall demand for common stock ownership.
The American sportswear brand has already shifted from traditional media advertising and is hugely focused on social media advertisements and campaigns. Nike concentrates on the athletes who display a high ROI based on their social media profiles. Furthermore, the company chooses the teams that are the most talked about and displays the most engagement based on the core fans on their social media accounts.
Nike has largely focused on digitalization ever since it saw all the growth opportunities it could enjoy there. It has revamped its marketing and products to embrace the age’s demands. For example, it rolled out the FuelBand, a $150 electronic bracelet, designed to measure a person’s movements throughout the day, whether he/she is engaged in sports, swimming, jogging, or walking. This is a clear nod towards developing a digital force that Nike is aiming for now. One other thing that the company is eyeing is to reduce production costs and make its products environmentally friendly. Flyknit Racer is an exemplary product from Nike in this line.
Nike and Adidas Business Model Comparison
Adidas Business Model
Adidas’s business is inclined towards creating innovative products that are crafted to suit the needs and increasing demands of the consumers. Adidas doesn’t believe in forming partnerships and invests less in its product endorsements. Instead, the company is more focused on creating value by building products that are high in performance and are created with an eye on the specific needs of commoners and athletes. Furthermore, it also concentrates on its production rate, the available infrastructures, and the latest technologies that it can adapt, which Adidas constantly re-evaluates and expands. Moreover, the brand also puts efforts intoreducing the complexity on a group level by streamlining the global product range. Consolidating the base of the warehouse and harmonizing above-market service are some other things that Adidas is often involved in.
Adidas aims to deliver the best-branded shopping experiences at all consumer touchpoints. The company has also brought in innovative speed models in the supply chain, which help it respond quickly to consumer needs. These are some of the Adidas strategies that have motivated investors from all around the world to purchase Adidas common stock. Besides, the company has also shown promising growth here for many years now.
Is Nike more successful than Adidas
Marketing/Branding Strategies of Nike and Adidas
Category
Nike
Adidas
Marketing Focus
Nike has a strong focus on sports and fitness and targets athletes and fitness enthusiasts through its marketing campaigns.
Adidas has a similar focus on sports and fitness and targets athletes and fitness enthusiasts. However, it also targets fashion-conscious consumers through collaborations with fashion brands and designers.
Advertising
Nike’s advertising campaigns often feature high-energy, motivational content that focuses on the connection between sports and personal empowerment.
Adidas also uses high-energy, motivational content in its advertising campaigns, but it also highlights the fashion-forward aspect of its products through collaborations with fashion brands and designers.
Marketing/Branding Strategies of Nike
On diving into the marketing strategies of Nike, the first thing that will pop up in your mind is the dominant hold of the market that Nike exercises. The brand believes in maintaining a strong brand image, where it is prominently remembered as a sportswear brand. Nike is capable of pulling it off with the help of numerous smart marketing strategies that the brand implements. Here’s a quick look at all the key marketing strategies of the brand:
Positioning of Products: Throughout history, Nike has positioned its products with utmost care. For example, it sells “athletic shoes” for the sportsperson, which helps it capture the niche market easily. Going by the market segmentation of Nike, the company targets athletes, sportspersons, and others who are eager to lead a sporty or healthy lifestyle.
Creative Ability of Storytelling: Nike has heavily relied on its storytelling abilities. The brand, as it was founded by athletes, also has an authentic background or a credible story that backs it up. Yes, Nike founder Bill Bowerman is the person who first implemented this incredible idea of telling real stories. Back then, he was a track and field coach during Nike’s initial days when Bill wrote stories for his products that helped the company connect with its audiences.
A Focus on Social Media Marketing: As soon as Nike discovered that most of its audience was there on social media platforms, the brand decided to target various social media platforms. This helped Nike witness rapid growth in social media platforms and revenues. Here are some key highlights of the social media strategies: It focuses on user-generated content, Nike works out collaborations with celebrities, the company often engages with the users on social media, Nike attracts influencers and allows them to promote the brand.
Makes for Easy and Hassle-free Purchasing via its Website: Nike has decided to build an easy and effective website that categorizes all the products neatly in an easy-to-use interface. The website of Nike brings out the bold and fearless attitude of Nike users, which Nike boasts of. Nike also has smart product recommendations on its website, which makes it easy for purchasers to make their own decisions.
Loyalty Program: Nike has a loyal group of over 100 million members who have been recorded to have spent 3X more time on their website than the guest buyers. Nike used this data to stress their loyalty programs and has magnified their loyalty programs.
Adidas has rapidly progressed in the past few years by utilizing smart marketing strategies. The brand has notably grown at a rate of 17.6%, thereby adding nearly $5.8 bn since 2015, when compared to Nike’s addition of $4.3 billion at an average rate of 6.8%. Here’s a list of all that Adidas leverages, which helps keep the brand ahead of its peers:
Digital Marketing Strategy and Technical Advancements: Adidas’ straightforward digital marketing strategy and its laudable implementation are the power behind its success. A fast-growing eCommerce channel, digital production processes, and the quick adoption of technological advancements help the company gain a considerable amount of revenue, along with helping it engage with its consumers.
The pace of Production: Adidas boasts of its speed of production, which is completely digitalized and empowered with the latest technology of 3d printing and robotics at Speedfactory in Ansbach.
Relationship with the Customers: Adidas’ customer relationship is unparalleled. The company is there on the leading social media channels and keeps a constant engagement alive with its customers.
Commendable Collaborations and Partnerships: Adidas calls in creativity. The company opens its doors and lets out an open call for all the sportsmen and other consumers from all around the world who have a creative bent to collaborate with the brand. The “Calling All Creators” campaign is one illustrious example of such initiatives of the brand. Furthermore, Adidas also collaborates with renowned football players, singers, and athletes to inspire its consumers and target customers.
Strategic Cities of Operation: The cities that Adidas has decided to run its operations in include London, Los Angeles, New York, Paris, Shanghai, and Tokyo, which have been strategically important for its growth.
Adidas Ad
Revenue of Nike and Adidas
Category
Nike
Adidas
Revenue (2024)
$51.36 Billion
$25.53 Billion
Revenue Growth
0.28% YoY
11% YoY
Major Markets
North America, Europe, and Asia Pacific
Europe, North America, and Asia Pacific
Brand Value Comparison of Nike and Adidas Worldwide From 2020 to 2023
Nike Revenue
Nike has bagged in revenues close to $51.36 billion in FY23- 24. Nike has recruited and has over 79,000 employees working for them as of 2024. It is clear that Nike is the biggest sportswear brand and is a market leader to whom most of the other brands operating in the segment look up. Nike has recruited and has over 79,000 employees working for them as of 2024. It is clear that Nike is quite big and is a really strong competitor of brands that deal with sportswear.
💡
Fun Fact – Nike’s headquarters has a running track inside it – True to its roots, Nike’s Oregon campus includes top sports facilities.
Adidas Revenue
Adidas’ revenues have been reported at $25.53 billion in FY23- 24. Adidas has an employee strength of over 62,000, which was last reported in 2024. Adidas is one of the largest players operating in the sportswear segment, giving strong competition to Nike.
Nike operates a mix of in-house and outsourced production, with a majority of its products being manufactured by contract factories in Asia.
Adidas also operates a mix of in-house and outsourced production, with a majority of its products being manufactured by contract factories in Asia.
Suppliers
Nike sources raw materials and components from a network of suppliers worldwide.
Adidas also sources raw materials and components from a network of suppliers worldwide.
Nike Production and Suppliers
Although Nike is an American company, just like its competitor, the shoes are not made in its own country. It has over 523 factories spread in over 41 countries, and shoes and made mostly in China and Vietnam. Chinese manufacturers supply 23% of all Nike production, while Vietnam contributes 16% of Nike’s total production, which mostly consists of creating apparel and footwear.
Adidas Production and Suppliers
All the shoes from the brand Adidas are specially made in China, India, Atlanta, Indonesia, Thailand, Vietnam, Turkey, Germany, and Atlanta States. Adidas has over 500 factories in over 55 countries. The majority of shoes are made in countries situated in Asia, like Vietnam, Indonesia, and China. Vietnam produces 44% of all Adidas footwear, followed by Indonesia at 25% and China at 19%.
Cool Factor of Nike and Adidas
Category
Nike
Adidas
Collaborations with Musicians
Nike has collaborated with musicians, including Kendrick Lamar and Drake, on exclusive product collections and marketing campaigns.
Adidas has also collaborated with musicians, including Kanye West and Pharrell Williams, on exclusive product collections and marketing campaigns.
Collaborations with Celebrities
Nike has collaborated with high-profile celebrities, including LeBron James and Serena Williams
Adidas has also collaborated with high-profile celebrities, including James Harden and Kylie Jenner
The cool factor here refers to the collaboration with music and celebrities or other influencers. Adidas seems to be winning in this category as its athleisure collaborations with Kanye West and Beyoncé as compared to Nike’s more sports-focused approach with sponsoring some of the biggest names in the sports category like Serena Williams, Roger Federer, Tiger Woods, Kobe Bryant, and Lebron James, have created some noise.
With athleisure becoming a new trend, Adidas is trying to win the market by this approach. Kanye West is the best example of this because, with the help of Adidas, he has now built a billion-dollar Fashion Empire through his sneaker brand Yeezy.
Michael Jordan with Nike Jordan Sneakers
Nike’s main collaboration till now has been with the basketball veteran Michael Jordan, whose Air Jordan line of trainers holds the top spot for celebrity sneaker brand, generating more than $3 billion in sales every year. But the first Jordans were launched in 1985, which is why it has lost their cool factor. The Celebrities that support Adidas are David Beckham, Pharrell, and Novak Djokovic, while Nike’s supporters are Drake, Roger Federer, Cristiano Ronaldo, etc.
Nike vs Adidas: Sports Sponsorship
Feature
Nike
Adidas
Sports Sponsorships
Nike has a strong presence in the world of sports through sponsorships of high-profile events and teams, including the NFL, NBA, and FIFA World Cup.
Adidas also has a strong presence in the world of sports through sponsorships of high-profile events and teams, including the UEFA Champions League, MLS, and the Olympics.
Athlete Endorsements
Nike has a long history of partnering with high-profile athletes and sports teams to promote its products.
Adidas also has partnerships with high-profile athletes and sports teams to promote its products.
Sports sponsorship has been the main activity of both companies and has a history of being a part of numerous famous sports events. Nike is known to be the main provider of apparel, footwear, and uniforms of the NBA league most of the time.
In 2018, however, Adidas sponsored way more than Nike in the Football World Cup. Where 12 teams wore the brand Adidas, 10 teams signed up for Nike. Adidas boasts the current World Cup holders, Germany, along with Argentina, Spain, Belgium, Colombia, Egypt, Iran, Japan, Mexico, Morocco, Russia, and Sweden.
Both companies have always competed on who will get to sponsor more teams, especially in events like the FIFA World Cup, the Olympics, and NBA basketball games.
Nike has announced plans to become more environmentally sustainable and expand its digital presence, including the use of augmented reality and personalization technology.
Adidas has announced plans to increase its focus on sustainability and to invest in technology and innovation to enhance the consumer experience.
As with previous years, Nike is pivoting on its digital and DTC segments. The company is currently hoping to make 50% of its operations digital by 2025. On the other hand, climate neutrality is one of the primary things that Adidas is currently aiming at. The brand is presently looking to achieve climate neutrality in its operations by 2025 and bring in climate neutrality on a global scale by 2050.
Nike Vs Adidas: The Real Battle
To be specific, there is this timeless battle going on between the best sneaker brands in the world. The battle started in 1976 when Nike hired John Brown and Partners as their advertising agency. Nike emerged with aggressive marketing and took 60% of the athletic shoe market in its grasp. When 1988 Nike started the ‘Just do it‘ campaign, it became one of the best ad slogans of the 20th century.
In recent times, more specifically in 2014, Adidas partnered with Ye, formerly known as Kanye West, who claimed that his Yeezy Boost shoes are way better than Jordan Sneakers. This thing escalated the rivalry as people started leaning towards Yeezy’s.
Adidas Yeezy
The sponsorship battle between the two is another issue. With Nike sponsoring some of the biggest names in the sports category, like Serena Williams, Roger Federer, Tiger Woods, Kobe Bryant, and Lebron James, it has created some noise.
On the other hand, Adidas also showed that it is not less than anyone by sponsoring some of the biggest names from the sports and music industry. David Beckham, Novak Djokovic, Lionel Messi, Beyoncé and Ye. Reports claimed that Nike pays more to their sponsors than Adidas, though.
The fight between the two sneaker giants didn’t stop even during COVID-19 when Nike started creating face masks while Adidas created face shields.
Which Is Better Adidas or Nike?
Nike and Adidas are the two heavyweights when it comes to footwear and sports accessories. Regardless of where we come from, most of us are attracted to these brands when it comes to sports accessories, including footwear and more.
Nike certainly has an edge over its archrival Adidas. The former has owned 38.23% of the market share when it comes to sportswear. The advertisements and powerful celebrity endorsements including that of Michael Jordan, help Nike steer past its German counterpart, Adidas, in terms of market share, revenues, and profits. The latter, though owning a lot less of the market share than Nike, is well-revered among the world of its users for its quality and longevity. Founded in 1949, the German brand is one of the oldest operating players in the sportswear industry. However, it is the split between the brothers, Rudolf and Adolf Dassler, of the Dassler Brothers Shoe Factory that resulted in the making of two different brands – Adidas and Puma. This not only divided the brothers and their business for the rest of their lives but also divided the revenues they collected. However, it is also this split of the brothers that gave the world two of the leading brands in the footwear and sportswear industry for the users.
In short, it is subjective to choose between Adidas vs Nike as it depends on personal preference, which brand is better between Nike and Adidas. Both companies have a strong reputation and offer high-quality products. Ultimately, it is up to the individual to determine which brand aligns with their style, comfort, and performance needs.
Adidas has always managed to keep its audience in consideration to design its products undoubtedly, but Nike has always had an upper hand in innovation and design when it comes to the sports market.
What are the differences between Nike and Adidas?
Both Nike and Adidas are major players in the sportswear industry, but they have some distinct differences in terms of design, technology, and brand image. Nike has a reputation for being innovative and heavily focused on performance and technology, while Adidas is known for its classic and iconic designs and a strong focus on sustainability.
Adidas or Nike, which brand offers better quality products?
It is subjective as both Adidas and Nike offer high-quality products. It ultimately depends on personal preference, individual needs, and product type.
Who makes more money Nike or Adidas?
Nike typically generates higher revenue than Adidas. In 2024, Nike’s revenue is approximately US $51.36 billion, while Adidas’s revenue is approximately US $25.53 billion.
What is the Nike brand value?
In 2023, the Nike brand’s worth was $71.6 billion.
Is Nike an American company?
Yes, Nike is an American multinational conglomerate that was founded in Eugene, Oregon, US, on January 25, 1964.
What does Adidas stand for?
The name “Adidas” stands for the abbreviation of the name of Adolf Dassler, the founder of Adidas.
What is the Nike market share?
Speaking of Nike’s market share, the US sports apparel and shoe manufacturing company presently dominates the sportswear with approximately around 38.23% of the market share.
Which brand is more popular, Nike or Adidas?
Nike is typically considered more popular than Adidas. Nike has established itself as a global brand and household name, with a strong presence in sportswear and a reputation for quality products. However, Adidas has also gained significant popularity and recognition, particularly in recent years, and has a loyal customer base. The popularity of these brands can also vary regionally and culturally.
Nike or Adidas which is better?
Choosing between Nike and Adidas depends on what you’re looking for. Nike is known for its innovation, cutting-edge performance gear, and powerful athlete endorsements, making it a favorite among serious athletes and trendsetters. Adidas, on the other hand, stands out for its comfort, sustainability efforts, and timeless style, appealing to both athletes and everyday users. If you prioritize high-tech performance and bold branding, Nike might be better; if you value comfort, eco-friendliness, and classic design, Adidas could be your top pick.
A quote is a good way to start an article about art. If you are reading this, chances are you are aware of art. Any sort of art, for that matter. You read this article, a poem, a story, or you watch a film, listen to a song, or embrace a painting. All these are forms of this one term “Art”. That term has been constantly celebrated from time immemorial. Be it a hundred years ago or a hundred years from now, it will be relatable ad infinitum.
The current times, the pandemic, and life afterward haven’t affected this culture. Our escape from the dust of daily life still hides in some form of art. Music and films are our top favorites of art. If you are a movie buff, then the first-day first show feel would be super important to you. This is where cinema halls and movie theatres come in to quench your thirst. They are temples for cinephiles.
Have you ever thought about how these work? How is a movie released nationally? What do the numbers and charts say? This is an article about the business model of movie theaters. Read on to find out how movie theatres earn and how cinemas are run. How the current unprecedented times are changing our movie experience.
“Art enables us to find ourselves and lose ourselves at the same time.” ― Thomas Merton, No Man Is an Island
The journey of a movie starts with a story in the director’s mind. Which is edited multiple times to get just about the perfect fit. Drafts and drafts and more drafts. Actors and actresses are auditioned for character roles, and a big crew is assembled to kick off the production.
Once the movie is produced, it is time for its distribution. The first distribution channel for any film has always been ‘Cinema Halls’. It is a century-old way of distributing what the actors and producers have produced.
The model is also quite unchanged, visitors pay a fee for entering the hall. The hall has seats, lots of seats, and the movie is shown through a projector on the front screen. The screen is big enough to be seen from around the theatre.
This has been the business model of a cinema hall for a very long time. However, it is added with some tweaks, like refreshments and snacks. More or less, this model is unchanged.
The audience sits on padded seats. In most theatres, the seats are aligned on a floor that is sloped, to enhance visibility for viewers. The highest part of that slope is at the back of the theatre. Movie theatres often sell snacks like popcorn, carbonated drinks, etcetera. In some areas, movie theatres with allowances and licenses can also sell alcoholic drinks.
Movie Theaters Global Market Report 2025
The movie theatre market has been growing steadily over the years. In 2024, it was valued at $79.62 billion and is expected to reach $83.16 billion in 2025, growing at a 4.4% annual rate. The movie theatre market is set to grow strongly in the coming years, reaching $102.46 billion by 2029. This marks a steady compound annual growth rate (CAGR) of 5.4%. This rise is thanks to several key factors from the past, like the golden age of Hollywood, the unique social and cultural experience of watching movies in theatres, big blockbuster hits, increasing urban populations, and changes in how films are distributed to theatres.
The distribution has always been primarily in cinema halls, but it is on certain terms and conditions. The production and completion of a movie are just one part of the whole big picture.
After the production, the movie is distributed via various channels. Cinema is the first tunnel, but thereafter too the movie travels the market. They are turned into DVDs, some go on to follow a streaming service way. But before the train moves to the next station, some decisions are made. These are known as the terms and conditions of the licensing of these films.
In India, theaters buy movies from distributors, who acquire the distribution rights from producers:
Role
Responsibilities
Producer
Sells the theatrical rights to a distributor for a specific territory
Distributor
Acquires the rights from the producer and hires theaters to screen the film
Theater
Pays the distributor a rental fee for the right to show the film
Theaters give 50–55% of ticket sales to movie distributors. They earn from showing new movies and selling snacks. A hit movie means more earnings. India’s film industry has 14 regions, each with its distributor. Most movies are sold to distributors with a minimum guarantee. Theaters can be single-screen or part of multiplex chains.
Terms regarding revenue sharing and movie release timings are also decided in advance. Before we get further, we need to know some technical terms that will help us get a clearer view of what the process looks like, so here goes!
Distribution of Box Office Revenue Worldwide in 2023, by region
Producer
A producer is a person who invests in producing a film. He is the investment guy who takes the risk of failure and the gains of success of a film. They invest in films under the name of a production house. For example, Karan Johar invests via a production house named “Dharma Productions”.
Distributor
The distributor is the person who distributes the film through the medium of theatres. The distributor buys the “distribution rights” directly from the producer. In most cases, he buys the rights in the very beginning, sometimes after viewing the final cut. Distributors can be of many types. They can vary in numbers, also.
If we are talking about a big-budget movie, then there can be a domestic distributor who is responsible for distributing in the home country of the film production. Others can be overseas distributors who are responsible for distribution in the rest of the world. There are typically some forms of how a distributor deals with the producer. Here we discuss the types of distributors:
Minimum Guarantee for Royalty
A minimum guarantee is the sum that is paid to the producer by the distributor of a film. It is here to be noted that the price is irrespective of how the film performs, whether it is a flop or a hit, which does not affect the minimum guarantee royalty. Usually, producers who have a stronghold in the industry ask for a high sum due to their brand name, which pulls in crowds into theatres.
After relieving the margin of the distributor, Anything more revenue earned than this minimum price is shared with the producer. So we see that the distributor cannot become the owner of the movie; he is licensing the movie.
Outright sale/purchase
As the name suggests, this is a contract of sale. The distributor buys the whole movie produced and all its rights. So lawfully, the distributor is the owner of the project. He is free to choose whatever medium he wants to use for the distribution. All the profits or losses earned or incurred are solely owned by him.
The commission is the typical model that many producers follow. They sort of hire a distributor to spread the movie. The distributor, instead of his services, asks for a fee or commission. In this case, he does not share profits or losses, he is just entitled to the negotiated commission. Risk is still left with the producer. However, the film performs, the distributor is entitled to his fee anyway.
The Exhibitor
He is the owner of a theatre that has the right to show the movie by the distributor. Both parties, the distributor and the exhibitor, are bound through a contract. That contract acts as a basis for sharing the revenue that is earned within the first, second, or third week of the release.
Here are the basic, typical sharing agreement terms and conditions. Take note that this is just to be taken as an example. Agreements can be changed and made with further discussions and debates between the distributor and exhibitor.
Duration
Profit Percentage Sharing
First Week After The Releasing of Film
65%:35% (Means 65% of Profit Share For Distributor and 35% of profit share is for Exhibitor)
Third Week
55%:45% (Means 55% of Profit Share for Distributor and 45% of profit share is for Exhibitor)
After Fourth Week
50%:50% (Means there after the profit sharing right is equal for both the Film producer and Distributor)
How Movie Theatres Make Money
We just learned how the movies of our beloved stars travel to the nearest theatre screen. This is a huge step; once distributed, the movie is ready for its trial. It is ready for criticism and reviews of any sort.
How Movie Theatres Make Money
With this onset, cinema halls are ready to be flooded with people. People like you and me who love the movie-watching experience. This turns the cash-making wheel. Here we are going to look at some of the most commonly seen revenue-generating sources for a cinema business:
Tickets
The revenue source of a movie theatre is mainly through ticket sales. A person who wishes to watch a movie in a theatre has to first buy a ticket to enter the premises. The premises where the movie is to be projected.
As discussed earlier, it is common ground for every ticket carrying a person with seats and a movie projector. However, it is to be noted here that a cinema hall is allowed to have different sections of seats according to its floor plan.
For example, some theatres also operate on a slightly changed pricing mechanism. They can give out some special seats for people who are willing to pay more. Those with premium seats would enjoy more comfort and more accessibility while watching the movie. All these are made in adjustments to improve the overall movie-going experience for the people.
Eatery and Snacks
A theatre has also added snacks to its revenue streams. It now also provides people with snacks for some extra bucks. The eatery can be assessed before the movie starts, in the middle of the movie (during the intermission break), or whenever the customer wants. However, this source of revenue is as per the customer’s needs, and even then, it has also become a strong money medium. The reason is the price differences of the articles that you buy while enjoying a movie.
Yes, the snacks that you buy at the eatery at a movie theatre are significantly higher than the maximum retail price that you may find in a regular market. I am sure you must have noticed that by yourself, the prices are exorbitant.
Once you are in a theatre, you unconsciously play by their rules. These are also known as MRP manipulations that not only theatres do, but they are also accompanied by companies. Companies produce the same products with an inflated or premium price for selected channels like our beloved theatres, cinema halls, eateries, etcetera.
Business Model of Movie Theatres
Advertising Revenue
If you think that you will not witness a single second of an advertisement after paying the ticket price, you are probably wrong. Advertisements are always there in between the gaps of movies.
Advertisements run on the reel before the movie starts, and they also immediately cover the screen when intermission comes. So this medium of advertisement, however small, also adds up to the cash for operating a theatre.
Until February 2020, before Corona, movies were first released in theatres and played exclusively for at least 75 days before home release. Home release means streaming online, video-on-demand, DVDs, etcetera.
Then came the lockdown era, which changed the whole scene. Every movie theatre was shut, and the cinema business saw a tremendous downfall. Movies began flowing in a different medium, never expected before. That was the inception of day and date releases, in which a movie was available to watch the same day it hit the theatres. So, it was available for renting or streaming on the day of its release. This was a huge shift in cinema. This also led to a shift in the profits of the cinema and the box office.
As this trend continued, the viability of these options began to diminish. The profits were distributed to OTTs and it changed the behavior of moviegoers. This raises the question of what the next strategy is for spreading movies.
Before the pandemic, studios primarily hoped for box office revenues. Almost more than half of the total cash is earned through theatrical releases. Not only this. Theatrical releases also help in setting up a benchmark for the further spread of the movie or anything filmy.
That benchmark, after the initial release, is used to sync negotiations of subsequent windows. Windows like that of ‘Licensing fees’ for television releases. The higher the benchmark is set by the initial release, the better the prospects of licensing fees for the artwork.
Behavioural Change of Moviegoers
COVID-19 encouraged two new behaviors – The first behavior was to watch movies in the comfort of our home. The reason for the decline in ticket sales is that home entertainment options have risen.
Be it streaming services and television, video games, or even your smartphone, we have a lot of entertainment options within a distance of a mere 5 meters. This means people are becoming less and less likely to move to nearby theatres.
Secondly, studios now care about their distribution. They are making their streaming services to capture more market share for the film. Hence, the pandemic caused studios to rethink their movie release and revenue model behaviours. Which was not to mention at least a century-old method earlier.
The Expected Future of Film Distribution
Now, you might think that streaming is the future. Whatever is happening in this industry makes it more flexible for the viewers. This is quite an obvious thought, but this industry is not that simple, and this pandemic shift in behavior is turning the revenues down. How do you ask?
Studios cannot monetize all their produced content through streaming. Especially when they have to rely on third-party streaming services for their releases. Despite their expanding market, profits are mostly churned out. Even for the studios that own distribution channels, streaming is not an economical way to follow for release.
The future of movie theaters will likely include new technology like virtual reality, 3D, and 4D for more immersive experiences. Filmmakers might try new ways to tell stories. Some theaters now offer extras like fancy food and drinks to bring in more people. They might also make money by hosting events or renting out spaces.
Warner Bros. announced that after the release of ‘Wonder Woman 1984’, every film release will debut on HBO Max. That can be accessed with a subscription fee. This policy was later changed and made fit for 2022. When the situation became a little normalized, HBO said that it would be released first in theatres, and after 45 days it would be available to further audiences. Thus, studios are approaching the situation dynamically.
On the other hand, Reliance Entertainment and T Series are hoping for the comeback of big screens in our society. They reportedly invest about INR 1,000 crores ($135 million) in big-screen releases.
Disney, one of the most famous studios in the world, is doing something completely different. Disney is seeing this hurdle as an opportunity to burst out and grow its wings. It is trying to fight Netflix in world markets. It has its own distribution channel, “Disney+”. This shows that the studio is trying to capture markets, and it is long on the streaming game. So much so that short-term revenue doesn’t fit their perspective for now.
How this balancing act between theatrical releases and streaming online will go, is to be seen. Only time will tell how studios manage to find a fit in these twisted markets. We discussed how the cinema hall business earns money. We also saw how a film is distributed in a geographical area.
There is a lot of money that can be earned in this industry, which is often abbreviated as one of the most profitable domains. The entertainment sector has also been boosted by the ongoing global pandemic.
In such a big country as India, with a population of more than a billion. Movies are the go-to entertainment, but with the rise of streaming services, it is witnessing a twist. Will a movie be celebrated even when it doesn’t hit the theatres? As studios think again about their movie distributing strategy, the more intense question is – Would you pay for a popcorn tub at the overpriced theatre, if you could stream the movie from the comfort of your home?
FAQs
How do movie theaters make money?
Movie theaters receive a portion of each ticket sold. They also make money from Food, drink, and merchandising sales, Advertising revenue, and Public funding.
How theater owners make money?
Theatre owners make money from ticket sales, high-priced snacks, and showing ads before and during movies.
How does the movie theater business work?
The movie theaters give a portion of each ticket they sell to the production company of each movie.
How do movie producers make money on Netflix?
Netflix pays licensing fees to the production company of the movie to stream movies.
How much theater owner earn in India?
A cinema hall owner in India can earn up to Rs 5 lakh per month with an initial investment of around Rs 7.5 lakh.
What is movie theater profit margin in India?
The profit margin for a cinema hall in India can be around 20–30% after deducting the costs of film rights and operations.
Is theatre business profitable in India?
The theater business in India can be profitable but depends on location, movie releases, and competition. However, challenges include high operating costs, piracy, and online streaming platforms. Profits are higher for theaters showing popular films or offering unique experiences like luxury seating or food services.
How theatre owners buy movies?
Theatre owners buy movies by paying a fee or sharing ticket revenue with film distributors.
PhonePe is the online payment platform that creates, hosts and manages your online transaction and also, provides various services through the Internet. Today, there are plenty of companies that provide you with the facility of online transactions. PhonePe is included among such companies. National Payments Corporation of India has evolved its technology and provided UPI to make the transactions absolutely convenient.
Well, our minds always come across the question of how these apps (including PhonePe) earn money? Or why do they spend so much money to gather customers? These questions are obvious. To understand this, you need to get your foot stable on the Broker. PhonePe and other similar applications work as a broker app. They work through the possession by leveraging the customers and traders.
In the era of capitalism of data, Online Payments transaction industries are the leading wave. They tend to evaluate their worth extremely high in the data-driven market. Therefore, in this article, we provided you with a basic guide on how PhonePe earns money? Stay tuned!
PhonePe is an successful application that has 11 different Indian languages. It provides plenty of features such as mobile recharge, receiving and sending money, DTH, utility payments, tax savings funds, data cards, and more. As of March 2025, PhonePe has crossed 600 million registered users on its platform.
The Reserve Bank of India has licensed PhonePe for the service of money transactions and payment system with an authorized name.
PhonePe launched a special insurance plan for travellers who attended the Maha Kumbh Mela in Prayagraj, Uttar Pradesh, held from January 13 to February 26, 2025.
The plan, developed in collaboration with ICICI Lombard General Insurance, was offered in two variants: INR 59 for train or bus travellers and INR 99 for domestic flight passengers.
Besides the transactions of money from one bank to another, PhonePe has many more tremendous features such as it provides the facility of purchasing grocery, insurance, food and many more.
PhonePe facilitates the supply of the products that are sold on this app. PhonePe is a multiple purpose application. It also provides the service of mobile recharge, electricity bills and other household bill payments.
PhonePe charges the commission on the payments made by the customers from any online or offline merchants. However, the UPI transactions are based on IMPS that’s why it doesn’t charge any additional money from the banks.
PhonePe POS machine
Recently, PhonePe has launched its POS machine that is available in almost every shop that allows PhonePe payment. The POS machine makes the payment extremely convenient and handy. PhonePe POS machine is powered by Bluetooth technology and is worlds lowest cost POS device in the world.
Here are the sources through which PhonePe makes money:
Mobile Recharge
As you know, PhonePe provides the facility of online recharge of your mobile very conveniently. It earns from the commission that is made from the operator you recharged on.
Bill Payment
When a bill payment is made through PhonePe on any company, PhonePe gets the commission from the respective company.
Apps
There is a separate column for different apps like OYO Rooms, Dominos, Myntra, Grofers and many more, on the PhonePe app. So, when you do any payment on these mentioned apps, PhonePe gets the commission respectively.
Gift Vouchers
You get plenty of gift Vouchers of different apps like Oxygen wallet, Airtel Money, Freecharge and more on PhonePe. It earns the commission on every sold gift voucher.
Digital Gold
PhonePe also allows you to buy gold, so when you do, it charges a little extra from you than the actual pricing.
Mutual Fund
Recently, PhonePe added the mutual fund’s investment features to its app. So, when you invest in any mutual funds, PhonePe charges a distinct amount of commission on the respective company.
PhonePe’s revenue has seen significant growth over the years, but expenses have also increased, resulting in continued losses. Below is a detailed breakdown.
Particulars
FY24
FY23
FY22
FY21
FY20
Revenue
INR 5,725 crore
INR 3,085 crore
INR 1,692.8 crore
INR 725.3 crore
INR 427.2 crore
Expenses
INR 7,756 crore
INR 5,907 crore
INR 3,705.7 crore
INR 2,456.9 crore
INR 2,202.9 crore
Profit/(Loss)
INR -1,996 crore
INR -2,795 crore
INR -2,013.8 crore
INR -1,728.8 crore
INR -1,771.7 crore
PhonePe Financials
In 2024, PhonePe’s operating revenue grew by 74% to INR 5,064 crore, up from INR 2,914 crore in 2023. However, total expenses also increased by 31% from INR 5,907 crore in 2023 to INR 7,756 crore in 2024. Despite this, PhonePe reduced its losses by 29%, with a loss of INR 1,996 crore in 2024 compared to INR 2,795 crore in 2023.
PhonePe does not have its own payment bank and also, it doesn’t charge any money when you regress any of your money back to your account. In fact, it provides you with different offers and cashback of the money you paid through any transactions.
Therefore, PhonePe works by promoting several brands on its app with different offers and vouchers. It earns the major fraction from the bill payments and recharges.
Moreover, PhonePe earns from Yes Bank by providing the analytic database and targeting its products to the users. Flipkart also utilises the service of monitoring purchasing and catching better advertisers, deals and notification through PhonePe to the customers. It collects and saves an ample amount of money from Flipkart from preventing channeling other payments apps.
Conclusion
PhonePe facilitates the services and payments along with the online transactions for several products available on the PhonePe application or website or any other external merchant stores (online or offline).
PhonePe is not an established bank or online payment bank. It is an application with a service not based on any banking services but itself. PhonePe works through a monopoly to earn its money and provides a safe and secure online transaction.
It is very prominent and widely famous across India with its great offers and services. PhonePe earns money in an absolute conventional manner and provides the best features and offers for payment.
FAQs
What is PhonePe and how does it work?
PhonePe is a mobile payment app that lets users send money, pay bills, recharge, and shop using the UPI system. It works by linking your bank account to the app, allowing secure and instant transactions directly from your phone.
Who is CEO of PhonePe?
Sameer Nigam is the CEO of PhonePe.
Does Flipkart owns PhonePe?
Yes, Flipkart acquired PhonePe in 2016.
Does PhonePe charge for money transfer?
PhonePe does not charge for money transfers.
Who has founded PhonePe?
Sameer Nigam is the founder of PhonePe company. He has founded PhonePe in 2015.
Who are the top competitors of PhonePe?
PhonePe’s top competitors include:
Mobikwik
Paytm
Google Pay
BharatPe
Juspay
Razorpay
What is the difference between PhonePe and PhonePe business?
PhonePe is for individual users to send money, pay bills, and recharge, whereas PhonePe Business is for merchants to accept payments, track sales, and manage transactions.
What is the business model of PhonePe?
PhonePe operates on a service-based business model. It earns revenue by charging merchants transaction fees, offering value-added services like recharges and bill payments, and selling financial products such as insurance, mutual funds, and digital gold. The company also provides POS devices to merchants and uses user data to cross-sell personalized financial products. While UPI transactions are free, PhonePe’s income comes mainly from these additional services.
Are you aware of any lucrative eCommerce platforms from the last ten years? Technically, no. As they were either bought, as Walmart did with Flipkart, or they were categorized as Infibeam. However, none of them succeeded on their own. In the last decade, over 20 online stores have attempted their fortune in India, but none had succeeded until Nykaa, a retail label that sells cosmetics, wellness, and fashion items, entered the fray. This firm has developed so much that it extended from an internet label to an omnichannel approach in 2015, which has enabled Nykaa to become a market leader.
Nykaa is an Indian eCommerce firm that offers cosmetics, wellness, and fashion items through its portals, apps, and over 100 physical locations in India. Falguni Nayar, a senior managing director at Kotak Mahindra Capital Firm, started it in 2012 as a billion-dollar firm. It offers items made in India and those made elsewhere in the world.
The firm transitioned from a web-based to an omnichannel business in 2015 and started selling things other than beauty products. It introduced Nykaa Pro in 2020, and Nykaa Fashion Limited began operating in Delhi in December 2020, with the goal of making its fashion company omnichannel. It also began selling over 2,000 labels and 200,000 items through its multiple networks. Several women who desire to begin their own eCommerce firms can draw ideas from this company.
Nykaa’s triumph is encouraging to us since few people over 50 have the confidence to resign and create a business from the ground up, yet Falguni Nayar did just that and founded Nykaa. She grew up in Mumbai and earned a finance degree from IIM Ahmedabad. She accepted a strategy consulting role after her MBA and served in a fine position at Kotak Mahindra Bank. However, in 2012, she launched the “Nykaa” label.
She once visited a Sephora store in another country and was astounded by the diversity of beauty merchandise under one dome. There were also complimentary samples, makeovers, and a bunch of discourse about beauty going on around the store. It was a woman’s fantasy come true.
This level of beauty diversification, expertise, and impartial advice was not offered to Indian women. For them, purchasing makeup meant a trip to the local pharmacy or a cosmetics boutique with untrained employees. High-end products were usually accessible in malls and high-street retail stores, giving customers few options. Falguni spotted a chance. At the stroke of 50, she left her senior management post at Kotak Mahindra and started Nykaa.com. The rest, as they say, is history.
Nykaa’s in-house brands consist of:
Nykaa Subsidiary
Description
Nykaa Cosmetics & Naturals
In-house personal brand offering makeup, body care, and skincare products
Nykaa Fashion
Provides apparel, bags, accessories, and more
Nykaa Man
Offers men’s skincare, haircare, and grooming products
Nykaa Pro
Grants beauty and makeup professionals access to multiple brands
Nykaa Network
An interactive beauty forum for users to engage and share beauty tips, tricks, and recommendations
Nykaa Business Model
Nykaa Business Model
Let’s explore Nykaa business model and the key factors that have contributed to its success.
Its inventory-driven business model for the BPC (Beauty and Personal Care) category is one of its key benefits. While it faces the risk of expiration and incurs inventory costs, it enables the firm to provide identification for all its items and ensures availability and prompt delivery. Its solution enables fungible stock across traditional and digital channels, making stock management easier.
Online BPC buyers are concerned about the increasing availability of counterfeit goods. As a result, a guarantee of legitimacy provides buyers with peace of mind.
Omni-Channel Strategy
Nykaa has a strong omnichannel marketing strategy that includes various touchpoints to engage with customers. This includes email marketing, social media marketing, influencer marketing, and offline events. By leveraging these various touchpoints, Nykaa has been able to reach a wider audience and create a strong brand presence.
It also has a geographic footprint in over 45 cities. It aims to expand its physical storefronts.
The function of retail stores is twofold:
They give customers the opportunity to try out things before making a decision.
They build a more resilient distribution network that will allow for potential hyperlocal delivery.
Shops also provide face-to-face encounters with experts and, in the case of some multinational premium brands, play a key role in personal branding.
Affiliate Program and Content-First Strategy
Nykaa is capable of promoting broad brand and influencer-led learning through innovative and engaging content across video and textual forms, thanks to a team of over 3000 influencers and 12.6 million fans across prominent social media sites. The Nykaa army generates and shoots the bulk of Nykaa’s material in-house.
Furthermore, the Nykaa Affiliate programme uses influencers on a wide scale, allowing external creators to create material on their part across multiple digital channels. The support of well-known influencers adds to the platform’s credibility.
Focus on Beauty and Wellness
The business model of Nykaa is focused exclusively on the beauty and wellness industry. By narrowing its focus to a specific niche, it has been able to establish itself as a specialist in this area. This has helped Nykaa create a unique brand identity and gain the trust of its customers.
Exclusive Product Range
Nykaa has a range of exclusive products that are not available on any other e-commerce platform. This has helped Nykaa create a unique selling proposition and differentiate itself from its competitors. The exclusive product range includes its own in-house brand, Nykaa Cosmetics, as well as other exclusive beauty and wellness products.
Tech-Enabled Operations
Nykaa has a strong focus on technology, which has helped it to optimize its operations and enhance the customer experience. Nykaa has invested in various technologies, including artificial intelligence and machine learning, to personalize the customer experience and offer customized recommendations.
What Is Unique About Nykaa | USP Of Nykaa
Nykaa’s BPC offering is extensive, with about 200K stock-keeping units (SKU) spread across a range of nearly 2500 worldwide, local, premium, and niche brands. It also sells things under its own label.
The consumer experience starts with a one-of-a-kind approach to product research that includes handpicked pieces and keyword or aesthetic look searches. Buyers may then search for merchandise using ratings, testimonials, how-to videos, and influential material, and interact with product specialists. This enables an immersive element, with the quality of the suggestions constantly increasing based on each client’s unique retail habits.
Tech Supremacy
It’s constantly improving its digital platform, not just to meet today’s difficulties but also to ensure future flexibility. The company’s data crew can use large volumes of data to offer dynamic, hyper-personalized customer experiences throughout their platform trips.
A Step Into the Glamour
Nykaa Fashion, a selected and supervised Taobao, started in 2018. It houses 1350 labels and over 1.8 million SKUs with fashion items across 4 customer segments: women, men, juniors, and home merchandising, which covers clothing, accessories, jewelry, and housewares. It selects designer labels and evaluates them for design and content. It has a customer base of less than 2% in the online fashion business, which is projected to be valued at INR 439 billion.
How did Nykaa BEAT Amazon & Flipkart in e-Commerce War?
How Does Nykaa Make Money | Nykaa Revenue Model
Nykaa holds items bought directly from manufacturers in its warehouses, where they are supplied whenever there are online or offline purchases. Buying straight from the manufacturers results in larger profit margins and increased market rivalry. It serves as an overarching brand for its health and cosmetics goods, which are sold through its stores and online. It also guarantees delivery within 1-4 days of the order being placed.
Nykaa’s revenue model encompasses a diverse range of strategies, including product sales, B2B sales, advertising and promotions, influencer marketing, and premium product offerings. By capitalizing on these revenue streams, Nykaa has cemented its position as a key player in the Indian eCommerce industry.
According to unaudited financial statements from the Bombay Stock Exchange (BSE), Nykaa’s revenue increased to INR 1,874.74 crore in Q2 FY25, compared to INR 1,507 crore in Q2 FY24. Its revenue from operations grew by 24.4% in the quarter ending September. Its profit also jumped by 66.3%, reaching double digits.
Nykaa has become a prominent player in India’s e-commerce industry with its unique business model that focuses on providing high-quality beauty and wellness products, excellent customer service, and innovative marketing strategies. The company’s strong online and offline presence, personalized customer experience, and diverse product range have enabled it to differentiate itself from its competitors and establish itself as a leader in the Indian beauty and wellness market.
Moreover, Nykaa’s success is not just limited to its business model, but also in its commitment to customer satisfaction, employee engagement, and corporate social responsibility. The company’s initiatives to empower women entrepreneurs and promote gender equality in the workplace have been widely recognized and lauded.
FAQs
What is Nykaa?
Nykaa is an Indian beauty and wellness e-commerce platform offering cosmetics, skincare, and personal care products online and in stores.
What is the revenue model of Nykaa?
Nykaa is an eCommerce company that sells its products and products of its partnered brands through its online and offline stores.
What does Nykaa do?
Nykaa, headquartered in Mumbai, is a prominent Indian eCommerce company specializing in beauty, wellness, and fashion products. It distributes its diverse range of offerings through its website, mobile app, and an extensive network of over 100 physical stores across the country.
What type of business model is Nykaa?
Business model of Nykaa is an inventory-based model. The company purchases the products directly from the manufacturer and stores them in its warehouse.
What is unique about Nykaa’s business model?
Nykaa’s business model is unique in that it focuses on providing high-quality beauty and wellness products, excellent customer service, and innovative marketing strategies. The company has also diversified its product range and services through strategic acquisitions, allowing it to offer a more comprehensive beauty and fashion experience to its customers.
Who is the CEO of Nykaa?
Falguni Nayar is the current CEO of Nykaa.
Does Nykaa manufacture its own products?
Yes, Nykaa makes its own beauty products under in-house brands but uses third-party manufacturers.
How has Nykaa differentiated itself from its competitors?
Nykaa has differentiated itself from its competitors through its focus on providing high-quality products, excellent customer service, and innovative marketing strategies.
Who are Nykaa competitors?
Nykaa’s competitors include Purplle, Sephora India, Myntra, Amazon, Flipkart, Tata CLiQ, Tira (Reliance Retail), SUGAR Cosmetics, Mamaearth, and Plum.
What is USP of Nykaa?
Nykaa’s USP is its focus on beauty and wellness, exclusive product range, strong influencer network, and tech-driven personalized shopping experience.
Is Nykaa a marketplace?
Yes, Nykaa is a marketplace for beauty and personal care category.
Google Pay is a digital wallet platform and online payment system developed by Google to power in-app and tap-to-pay purchases on mobile devices. Google Pay enables its users to make payments with their Android devices phones, tablets, watches, etc.
In addition, the service also supports passes such as coupons, boarding passes student ID cards, event tickets, movie tickets, public transportation tickets, store cards, and loyalty cards.
It can be used for online payments, in-app purchases, contactless in-store payments, and even for sending peer-to-peer money. So whether someone is browsing for a new pair of sneakers online or buying your morning coffee, Google Pay can do all the heavy lifting for them.
In this article, we’ll take a closer look at the Google Pay business model, how it makes money and how it has become one of the most successful digital payment solutions in the world.
Safe, simple and fast payments l Google Pay hai, tick hai
Easy and Convenient Payments: Google Pay makes it easy and convenient to make payments using your mobile device. You can make payments using your phone, tablet, or smartwatch, without the need for cash or physical credit cards.
Integration with Google Services: Google Pay is integrated with various Google services, such as Google Chrome, Google Assistant, and Google Maps, which makes it easier to make payments while using these services.
Secure Transactions: Google Pay uses multiple layers of security to protect your payment information, including encryption, tokenization, and biometric authentication (such as fingerprint or facial recognition).
Multiple Payment Options: Google Pay supports multiple payment options, including credit cards, debit cards, and bank accounts. You can also add loyalty cards and gift cards to your account for easy access.
Rewards and Cashbacks: Google Pay often offers various rewards and cashback programs for using the service, such as earning rewards for making purchases or referring friends.
Bill Payments: Google Pay allows you to pay various bills, including utility bills, credit card bills, and more, all within the app.
Google Pay has been consistently rising in India, The Alphabet and Google CEO- Sundar Pichaisaid that the company has taken cues from the successful experience in the country and would soon put out a revamped digital payments product globally.
Compared to the other mobile wallets Google Pay is successful in India because of its business model which includes the following factors:
Partnership-Focused Innovation
Localization for Success
Ecosystem Integration
Small Business Support
Job Seeker Support
Digital Payment Awareness
Rural Outreach
Entity-Based UX
In-App Engagement
Cashback Offers
Google Pay focuses on partnerships, localization, and ecosystem approach as it forged deep partnerships with the central bank and government to innovate and build collectively and make products interactive and open to working jointly within the ecosystem.
The company deepened its support for small businesses through a new app called Google Pay for Business which was a free and easy way for small merchants and storefronts to enable digital payments without the hassle of a time-consuming verification process.
Google Pay also supports job seekers by introducing a spot on Google Pay to help people find entry-level positions that aren’t always easily discoverable online.
It collaborated with the Government to come up with Digital Payment Abhiyan to increase awareness about cashless payment and online financial security in the country.
The company also launched the Vodafone Idea Phone Line to help people in rural areas where the internet connection is weak to get information about everything.
Its entity-based UX users search for who they paid earlier rather than the transaction date and time. Under the entity-based model, users see individual chat leads of every individual or merchant, they transact with, whenever they have to check a payment record.
Google Pay introduced the spot platform in India which is a way for the business to create an experience and engage their customers within the Google Pay app. Popular services like UrbanClap (now Urban Company), Goibibo, MakeMyTrip, RedBus, Eat.Fit,and Oven Story were the first to board in its early access program.
Scratch cards are another attraction as Google Pay provides lucrative cashback and offers on varying transactions. These cashbacks are directly credited to a linked bank account. The app also provides multiple payment options so users can transact through their mobile numbers and Virtual Payment addresses.
Biggest Contactless Payment Brands at POS in India as of March 2024
How Does Google Pay Make Money | Google Pay Revenue Model
Google Pay has several global revenue-making opportunities. The revenue might be both from transaction fees from banks or merchants which is $4.1 billion and also from ads and product offers within Google Pay which is $0.4 billion.
Google Payment India Private Limited reported its revenues for the financial year 2020-21 as ₹14.8 crore. The company further reported a net profit of ₹1.4 crore during the same fiscal.
Google Pay was first launched in August 2017. Google first named this app “Tej” and later changed the name to “Google Pay“.
Google Pay does not charge its users for accessing Google Wallet. Receiving and sending money on Google Pay is free. Previously, the company had an agenda of adding a 2.9% fee to funds via debit card. However, now the plan is dropped and it’s all free as mentioned above.
The app has over 67 million monthly active users and enabled more than 2.5 billion transactions and now has an annual run rate of over US$110 billion in transaction value. This app user can now pay at more than 200,000 stores in more than 3,500 cities and towns, and more than 2,700 online merchants.
Google Pay earns money through the following sources:
Mobile Recharges: The basic revenue model of Google Pay is mobile recharges. Whenever a user recharges on any SIM operators from this app, then they get a commission from that operator on every recharge.
Bill Payments: Google Pay allows you to pay for any kind of bill from this app such as electricity, DTH recharge, water, insurance, loan repayment, postpaid bills, and so on. Whenever you pay any company bill, it takes a commission from that company.
UPI Transaction: So this app does not earn from UPI transactions, it just analyzes your transaction data, which it uses to make its new product. The main reason most people use Google Pay is for UPI payments. The app also provides more services such as mobile recharge, and bill payment. So when people have to use either or both of these services, they use this app and this app earns from both the services.
Ad Revenue: Google Pay uses its large user base and transaction data to offer targeted ads, generating revenue through in-app promotions and merchant-sponsored offers. Ads are personalized based on user behavior and spending patterns, appearing within the app or across Google platforms. Merchants also pay to feature special offers, driving traffic to their sites or apps.
Partnerships: Google Pay earns revenue through partnerships, ads, transaction fees, and in-app purchases. It teams up with banks, e-commerce platforms, and payment providers, often sharing revenue from transactions like virtual card payments.
Google Pay Net Worth
The company’s net worth stood at ₹12.8 crore for FY21 compared to ₹10 crore at the same time the previous year.
Growth of Google Pay in India
Google mobile payment system Google Pay has emerged as the king of UPI payments in India, with an annualized transaction value worth $110 billion. Google Pay has 150 million users worldwide, with 67 million users in India. Millennials are 30% of active users of Google Pay.
According to a report by GlobalData, the value of mobile wallet payments in India experienced a compound annual growth rate (CAGR) of 72.1% from 2019 to 2023, reaching INR 202.8 trillion ($2.5 trillion) in 2023. Mobile wallet payments in India are projected to exceed INR 531.8 trillion by 2028.
In India, Google Pay holds a 35% market share in UPI payments. The app resembles a chat app that is easy to use and is available in local languages.
The platform is used by customers to buy train tickets, pay bills, and even purchase lunchtime meals from street vendors. In India, local stores have begun to accept Google Pay payments via a phone application. Meanwhile, the Google Pay platform’s update includes features like tokenized cards for more secure payments, food security, Google Pay for business, e-KYC, and simpler onboarding and donations.
In India, Google Pay is facing stiff competition from other fintech startups including wallets such as Paytm, PhonePe, Amazon Pay, Airtel Payments Bank, etc. The upcoming contender in the race is the Whatsapp Pay service by Facebook.
Funding Received by Google Pay
Founders of Google Pay in India raised $13.2 million in January 2020 in a Seed funding round for its neobank, Fi led by Sequoia India and Ribbit Capital. Also participating in the funding rounds were David Velez, Kunal Shah, and VC fund Hillhouse Capital.
In October 2020 the investment app, ETMONEY, had partnered with Google to offer Google Pay users a route to invest in mutual fund schemes and the National Pension System (NPS).
This collaboration will allow Google Pay users to identify the right mutual fund schemes and invest in them within minutes using their Google account and Unified Payments Interface (UPI) ID.
Google Pay users will not have to create a user ID to access this facility. It will be the same if one wants to invest in NPS as well. Sujith Narayanan and Sumit Gwalani, both co-founders of Google Pay India formerly called Google Tez said that the seed funding brings the Neobank startup Fi to a valuation of roughly $50 million.
FAQs
What is GPay?
Google Pay is a fast and simple way to pay using credit or debit cards saved to your Google account. It works for online purchases, in-app transactions, and in-store payments with your Android device.
What is the revenue of Google Pay in India?
Google Pay revenue in India was INR 1467 crore in 2021.
How many people use Google Pay worldwide?
Google Pay has 150 million users worldwide.
How does Google Pay make money in India?
Google Pay makes money through commissions it gets for transactions from companies or operators. For every transaction that you make using Google Pay, it gets a commission from the company.
Who are the competitors of Google Pay in India?
The top competitors of Google Pay in India are:
PhonePe
Paytm
PayPal
Amazon Pay
Whatsapp Pay
Is Google Pay profitable?
Google Pay is likely profitable for Google, though its standalone earnings are not publicly disclosed.
What is GPay business model?
Google Pay business model earns revenue through transaction fees, targeted ads, partnerships with banks and merchants, and in-app promotions.
In recent years, Amazon has become a household name, whether it’s because of its unlimited options for selection, custom-made services, cheaper prices, customer services, or good quality search tool that helps in finding items of one’s choice. Amazon is a US-basedmultinational e-commerce company that focuses on e-commerce, digital streaming, artificial intelligence, and cloud computing. Amazon is now the world’s largest online retailer and has also been referred to as the world’s most valuable brand.
Amazon was founded by Jeff Bezos in 1994 and is headquartered in Seattle, Washington. The company started out as an online marketplace for books but went on to expand its market to selling electronics, music CDs and DVDs, tools, toys, software, video games, apparel, furniture, baby products, sporting goods, beauty products, clothing, and jewellery, among others.
Amazon is considered to be one of the big five companies in the US information technology industry, along with companies like Google, Facebook, Microsoft, and Apple. Amazon went on to surpass Walmart as the most valuable retailer in the US by market capitalization in 2015. Amazon Prime, had surpassed more than 200 million subscribers worldwide as of 2024.
Amazon has a well-known diversified business model. According to the annual report as of 2024, the company recorded net sales of over $638.0 billion and a net profit of over $59.248 billion. Amazon’s business model is an Ecommerce model, but over the years, it has made acquisitions and created a portfolio of business models and revenue streams. However, the biggest proportion of sales, which is fifty percent, came from their online marketplace.
The rest comes from the physical stores, Amazon AWS, subscription services to their apps, third-party seller services, and lastly, advertising revenues. Amazon Prime, which is a subscription-based service, plays an important role in the business model, as it gets the company more loyal customers who are willing to spend more for their services. Amazon also has a cloud infrastructure called AWS, which yields high margins. Besides that, Amazon also has an advertising business, which is worth billions of dollars.
The Amazon Business Model Canvas
Amazon measures its success based on lower prices, reliable tech infrastructure, free cash flow generation, and customer experience obsession. The company’s service sales have been growing at a fast pace, helping the company to expand globally. Amazon had attracted over 3.25 billion visits in June 2024 worldwide, while people spend more than six minutes on the site looking at a minimum of nine pages in order to find what they are searching for.
Amazon runs a platform business model as the core with many other business units within the core model. Some units, such as Prime and the advertising business, are heavily linked to e-commerce platforms. For example, Prime helps reward Amazon customers, thus growing its platform business. Other units, such as AWS, helped improve Amazon’s technical infrastructure. Amazon sells a variety of its own products on the platform but also allows third-party sellers to sell to customers.
Here are some key milestones of Amazon:
1995 – Amazon launched as an online bookstore.
1997 – Became a publicly traded company.
2005 – Launched Amazon Prime, offering fast delivery and other benefits.
2006 – Introduced Amazon Web Services (AWS), now a leading cloud platform.
2012 – Acquired Kiva Systems to automate warehouse operations.
2015 – Celebrated 20 years with the first Prime Day sale.
2018 – Reached $1 trillion in market valuation.
2020 – Saw massive growth during the COVID-19 pandemic.
2021 – Founder Jeff Bezos stepped down as CEO; Andy Jassy took over.
What Does Amazon Sell?
Currently, the platform offers products and services such as Amazon Prime Video, Amazon Music, Appstore for Android, Echo and Alexa, Fire tablets and TVs, Kindle e-readers and books, merchant products and seller products. Amazon’s target audience is customers who buy products and subscribe to its services. So vendors sell their products on the platform, and developers are focusing on using AWS technology for infrastructure, digital products, and services.
Revenue and services of Amazon
Key Elements of Model
Consumers – Amazon has great customer service and makes sure that they serve their consumers through their online websites. The company focuses on selection, convenience, and price. The Amazon website is designed in such a way that customers can browse through dozens of product categories and access them conveniently on various gadgets. The company strives to offer its customers the lowest prices through everyday product pricing and shipping offers.
Sellers –Amazon gives sellers the opportunity to grow their business, sell their products on websites, and fulfill orders through us. Amazon earns fixed fees, a percentage of sales, per-unit activity fees, interest, or some combination thereof for the seller’s programs.
Developers and Enterprises – Amazon serves developers and enterprises of all sizes, which includes startups, academic institutions, and government agencies through their AWS segment, which promises to offer a broad set of global computing, storage, database, and other services.
Content creators – Amazon also helps authors and independent publishers with Kindle Direct Publishing, an online service that allows independent authors and publishers to choose a 70% royalty option and make their books available in the Kindle Store. They also offer programs that will allow musicians, filmmakers, app developers, and authors to publish and sell their content.
Amazon Advertising – Amazon Advertising provides sponsored ads and video options, making it a highly effective marketing channel, as users on the platform already have strong purchase intent.
With a market capitalization of $1.92 trillion as of April 2025, Amazon is currently one of the most valuable retailer in the world. Amazon’s online stores bring in high margins, while other parts of the Amazon business model, such as Amazon Advertising Services, Amazon Prime and Amazon AWS, run with much higher margins.
Thus, Amazon’s online stores are the foundation for other businesses that make the overall company more profitable in the long run. An important day for online sales is Prime Day, which has turned into a major shopping event comparable to Black Friday and Cyber Monday.
In 2024 Amazon Prime day generated over $14.20 billion which is a record high. The third-party seller is the company’s second-largest unit in terms of net sales. A key factor in the company’s success is its diversification into other areas.
How Amazon Makes Money
The revenue model of Amazon is primarily based on the commissions and fees it receives for matching borrowers and sellers. Amazon provides a marketplace that provides a standardized experience for both buyers and sellers. Amazon also derives a large portion of its revenue from affiliate programs in order to receive a large commission on their sales. The company also sells advertising space on its website so that vendors can increase their sales by advertising on the site. Amazon also makes a lot of money from the Kindle marketplace.
Online stores – Includes product sales and digital media content where we record gross revenue. Amazon leverages our retail infrastructure to offer a wide selection of consumable and durable goods that include media products available in both physical and digital formats, such as books, videos, games, music, and software. Digital product subscriptions that provide unlimited viewing or usage rights are included in the Subscription Services.
Physical stores – This includes product sales where our customers physically select items in a store. Online stores include sales to customers who order goods online for delivery or pick up from our physical stores.
Third-party seller services – The Company receives a substantial portion of its revenue from third-party sellers, from commissions and any related fulfilment and shipping fees and other third-party seller services.
Subscriptions – Amazon Prime membership comes with an annual and monthly fee. Amazon also offers subscription services for audiobooks, digital video services, digital music, eBooks, and other non-AWS services. Amazon’s standard Prime membership rate is $139 a year, which would translate into more than $25.21 billion in revenue, though the company offers discounted memberships for students and others.
AWS – AWS includes global sales of computing, storage, database and other services.
Other services – These include sales of advertising and marketing services.
The value proposition provided by Amazon is actually quite simple: they offer the most convenient and widest range of products and services for the lowest prices. The prices of its products and services are so low that they have managed to displace Walmart, making the company the leader in the price category. While the goods and services are at the lowest prices, the quality of the products is not compromised in any way.
Amazon takes advantage of technology to get the lowest prices possible so that it doesn’t have to stock any kind of inventory. While other stores are burdened with spending money on stocking inventory, Amazon can cut out the competition on this one. It is a mix of a retail company and a technology company. Unlike retail companies, Amazon rarely hires stock clerks and floor managers and keeps employees with high technical skills.
Conclusion
Amazon is the face of the current market – global, digital, and ever-growing. It is a rapidly productive brand, adapting quickly to new demands in a fast, effective, and original way. For this reason, for now, even though it faces competition individually on all fronts, its corporate umbrella remains unique and, hence, should stay ahead in the coming years.
FAQ
When and by whom Amazon was founded?
Amazon was founded by Jeff Bezos in 1994.
How many business models does Amazon have?
Amazon has five main business models, an eCommerce, a Cloud Platform with AWS, runs subscriptions with Prime, third-party sellers and it also produces hardware products such as voice assistant, Alexa, the ebook reader Kindle, and more.
What business model does Amazon use?
Amazon uses a hybrid model: it sells products, lets others sell on its site, offers subscriptions like Prime, runs cloud services (AWS), earns from ads, and provides logistics and devices like Alexa.
Is Amazon a B2B or B2C?
Amazon is both a B2B and B2C company.
What is Amazon business model in India?
In India, Amazon follows a marketplace model, connecting buyers and sellers, offers Prime subscriptions, earns from ads, and provides logistics through Amazon Transportation and Fulfillment services.
Lakshya Singh
