• Total online food delivery gross merchandise value (GMV) reached US$15.5B
  • Grab contributed close to half of the region’s food delivery GMV at US$7.6B, followed by foodpanda at US$3.4B and Gojek at US$2.0B
  • Major players record improving margins and expand into on-demand grocery delivery for growth and diversification

SINGAPORE, 27 January 2022 — Momentum Works released its second annual “Food Delivery Platforms in Southeast Asia” report today, offering in-depth insights into the fast-growing and dynamic food delivery landscape across the region’s six largest markets.

The report revealed that the total food delivery gross merchandise value (GMV) in Southeast Asia reached US$15.5B, a 30% increase from an all time high of US$11.9B in 2020. This sustained growth suggests that COVID-19 has had a lasting impact on consumer behaviours, as Southeast Asians continue to rely on food delivery services for the convenience it brings to their daily lives.

While Indonesia, Thailand and Singapore remained the region’s largest food delivery markets, Thailand and Malaysia posted the highest year-on-year growth – a reflection of the consumption power in these countries despite challenges posed by the pandemic. Vietnam, on the other hand, experienced minimal growth, likely due to strict COVID lockdowns which impacted food delivery operations.

Despite an increasingly competitive market, Grab, foodpanda and Gojek retained their positions in 2021. Grab is estimated to have contributed close to half (49%) of the region’s food delivery GMV, closing the year at US$7.6B. Foodpanda contributed 22% to the regional GMV, recording US$3.4B in sales. Gojek is estimated to have ended the year with US$2.0B in food delivery sales, making up 14% of the region’s GMV. Key players and their market share  breakdown by country include:

  • Indonesia: GrabFood (49%), GoFood (43%), ShopeeFood (8%)
  • Thailand: GrabFood (47%), foodpanda (22%), LineMan (22%)
  • Singapore: GrabFood (54%), foodpanda (34%), Deliveroo (12%)
  • Malaysia: foodpanda (49%), GrabFood (48%), ShopeeFood (3%)
  • Philippines: Grab (52%), foodpanda (48%)
  • Vietnam: Grab (41%), ShopeeFood (41%), Baemin (3%) 

“2021 confirmed that the pandemic-induced spike in food delivery demand is here to stay. Food delivery is an attractive market especially with e-commerce stagnating. As players expand into more new cities and services, and the restaurant industry becomes more digitally-enabled, we anticipate continued growth of food delivery well into 2022,” said Jianggan Li, Chief Executive Officer and Founder of Momentum Works.

Regional trends

Momentum Works’ report also sheds light on industry trends:

  1. Pandemic-induced consumer behaviours attract new players: Prolonged COVID lockdowns led to improved user stickiness and larger basket sizes of food delivery orders. This gave technology companies new impetus to expand into food delivery, with ShopeeFood scaling from Vietnam to three new markets, and new players such as AirAsia Food and Traveloka Eats entering the sector.

While newer players such as Shopee Food adopted aggressive promotional tactics to acquire customers in 2021, it remains to be seen if such practices would continue in 2022 given a large industry shift towards rationalization and profitability.

  1. Superapp as a business model proved advantageous even in a very crowded market: Grab continued to hold the majority share of the region’s GMV with improved margins. The superapp model with advantages such as lower customer acquisition and driver costs works well in Southeast Asia, a region with differing merchant density and volume across urban and outer cities.
  1. Restaurants adopt a hybrid digital approach to unlock and capture new growth opportunities: Larger establishments deepened partnership with food delivery platforms while continuing to scale up their own digital channels. Smaller establishments ventured into cloud kitchens and launched new brands and concepts for diversification.
  1. Major platforms expand into on-demand groceries: Regional and local food delivery players, including Grab, Gojek, foodpanda and Lineman Wongnai, pushed more aggressively into grocery and ‘quick commerce’, leveraging their respective delivery infrastructure and customer base to tackle a much bigger total addressable market.
  1. Major platforms see improved margins: Grab and Delivery Hero both made segment margin improvements in 2021. Profitability is attainable with improving operational efficiencies, high order volume and supply density, and additional services to better monetize the platform and retain customers.

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About Momentum Works

A Singapore-headquartered venture outfit, Momentum Works builds, scales and manages tech ventures across the emerging world. 

Momentum Works also leverages its own knowledge, community and experience to inform, connect and enable the tech/new economy ecosystem. Key business areas include ventures, insights, academy and advisory. 

For more information

The full report is available upon request.  

For further enquiries, please contact Crystal Yu (crystal.yu@mworks.asia)

 

Appendix A

Appendix B

Appendix C

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at hello@mworks.asia.