Vietnam’s online food delivery market was relatively quiet two years ago when Foody’s Now.vn dominated the space.

In a move that shook up the industry, Grab officially announced the launch of GrabFood in Ho Chi Minh City in June 2018 to pursue the ambition of creating so-called super-apps.

Since then, competition has intensified in the online food delivery market.

Grab has rapidly expanded food delivery services to Hanoi, the central city of Danang, and 15 other cities and provinces after only seven months of launching.

GrabFood has become a heavyweight player in the market with the fastest growth rate. It is clear that Grab’s advantage in ride-hailing with a fleet of thousands of driver partners has created a springboard for GrabFood’s aggressive expansion.

In addition to fast expansion, GrabFood has quickly proved its strength in delivery time with an average of only 20 minutes per order thanks to its massive number of delivery partner, which enables GrabFood to dominate the minds of users and become a "phenomenon" in the food delivery market.

GrabFood recently marked its first-year anniversary in the Vietnamese market with impressive figures, growing 250-fold in the number of daily orders against the beginning of the third quarter of 2018.

According to the latest survey by market research firm Kantar in April 2019, 81 per cent of respondents voted GrabFood as their most frequently-used service for food delivery.

Vietnam is proving to be a lucrative market since witnissing the presence and successes of GrabFood. Vietnamese subsidiary Go-Viet, of Indonesia’s Go-Jek, jumped on the bandwagon by launching Go-Food last November.

To lure customers, Go-Food ­proffers countless promotions and free delivery for consumer, along with the strong investment on its communications by choosing one of the most famoussinger in Vietnnam to be the official brand ambassador.

In this context, some food delivery startups have been knocked out by intensive competition. Vietnamese startup Lala pulled out of the market after a year of operation. Foodpanda sold its business to domestic rival Vietnammm in late 2015.

More recently, South Korea’s new unicorn Woowa Brothers Corp. acquired Vietnammm to make its inroad into the Vietnamese market. The deals reflect the fierce competition in Vietnam’s online food delivery market where only strong players with right strategy can stay in the game.

Over the past year, these firms have heavily invested in their food delivery services to enhance the speed and service quality. The most obvious change is an improvement in delivery speed.

While GrabFood is offering the fastest delivery service, generally posting 20-minute deliveries regularly, Go-Food is also continuing efforts to cut delivery times, taking advantage of its driver base.

Now.vn with a strong footprint in the market is also stepping up delivery time to catch up with its rivals.

To attract more users, the startups often innovate and refresh the portfolio of food and beverages. Now.vn features a collection of dishes based on Foody’s gourmet search and user review platform.

Meanwhile, GrabFood is creative with its unique dish programme, in which GrabFood co-creates with strategic merchant partners to offer exclusive menus only ordered on GrabFood, bringing interesting gastronomic experiences for customers.

Besides, merchant partners like restaurants and coffee shops can earn more income with online food delivery services. GrabFood has proven to be a real revenue driver for merchant partners in large cities.

Accordingly, this service benefits hundreds of thousands of small businesses and micro-entrepreneurs, especially those with shops or stalls located in remote and under-served areas with minimal human traffic, and have no expertise in professional communications.

Some merchant partners of GrabFood have increased net revenue by 300 per cent since joining the platform.

Current and potential future moves by these companies, as well as others on the horizon, make it clear that customers are the ones gaining the most benefit from the development of food delivery platforms. VIR

Thanh Van