New Delhi: In a bold move to navigate the challenges of a slowing food delivery market, Zomato has laid off up to 600 customer support employees, just a year after they were hired. This decision marks a significant pivot towards cost-cutting and AI-driven automation, as the company seeks to bolster its operational efficiency. The layoffs, predominantly affecting employees in Gurugram and Hyderabad, follow Zomato’s introduction of ‘Nugget,’ an AI tool designed to handle a substantial portion of customer support interactions.
The layoffs are closely tied to Zomato’s broader strategy to automate customer support using AI, a move aimed at reducing operational expenses as the company grapples with a downturn in its core food delivery business and mounting losses in its quick commerce subsidiary, Blinkit. Zomato had previously hired nearly 1,500 employees through its Associate Accelerator Program (ZAAP) for customer support roles, but many were let go without prior notice, receiving only a month’s salary as compensation.
Zomato’s push for automation is evident in its reliance on AI to manage customer interactions, a strategy that could significantly reduce the need for human customer support staff. Despite these layoffs, Zomato’s stock witnessed a slight increase during a recent trading session. The layoffs have not only affected the job security of remaining employees but also sparked debates about the role of automation in workforce management.
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