|A deliverywoman looks at her device while on the move. / Korea time file|
By Kim Jae-heun
Coupang Eats is hot on the heels of Yogiyo, threatening to overtake the rival for the number two spot in Korea's rapidly-expanding food delivery service market.
Yogiyo's market share stands at 18 percent, down from a 20-percent high until recently. Coupang Eats, on the other hand, has increased its market share from 5 percent to 10 percent.
According to big data firm IGAWorks, Coupang Eats' monthly active users (MAU) on Android smartphones skyrocketed by 70 percent to 1.26 million last November compared to 748,000 in August. That means Coupang's delivery service platform attracted 500,000 more customers over that short period.
Meanwhile, other players saw their MAU decrease. The No.1 player, Baedal Minjok, owned by Woowa Brothers, saw its market share edge down just 1 percent. However, the No. 2 and No. 4 players, Yogiyo and Baedaltong, saw their MAU drop 10 percent and 28 percent, respectively, during the same period.
The numbers say a lot about Coupang Eats' potential in the market as demand for food delivery services has been surging due to a resurgence of COVID-19 infections in the country.
"Coupang adopted an aggressive marketing strategy which has paid off by attracting a large number of multi-homing users to its platform," an industry source said. Multi-homing users refers to customers who use various platforms depending on their needs.
Unlike other players, the company restricts its workers from delivering more than one order at a time. This is to make sure their customers receive food as soon as possible and in the freshest condition.
This, of course, forces it to spend more on labor. But Coupang is being selective in its investments to steal customers from its rivals to gain more market share.
Coupang Eats also revealed plans to expand its business outside the capital area to Daejeon, Ulsan and Daegu. It launched services in Busan last month.
The firm has been recording explosive growth based on its service in the capital area. Tapping into its experience of expanding logistics centers across the country, Coupang Eats will continue to see MAU grow for quite a while," the source said.
Yogiyo has no time waste as it is in the process of being sold off to another company. Its operator, Delivery Hero, has decided to acquire Baedal Minjok and sell Yogiyo to become a leader in the domestic market.
The Korea Fair Trade Commission ordered Delivery Hero to sell Yogiyo if it wants to merge with Woowa Brothers. The decision was made to prevent Delivery Hero from monopolizing the local market where Baedal Minjok and Yogiyo control nearly a 90 percent combined share.