To boost GrabFood services in Thailand, the company is investing what it said is the largest amount of marketing budget this year in a new campaign, Free Your Hunger. The campaign is intended to double GrabFood customer numbers and sales by restaurant partners.
"Grab sees the potential of the food ordering business in Thailand, which continues to grow as the pandemic has changed people's behaviour to use such services, while mobile internet penetration has reached 80%," Chantsuda Thananitayaudom, marketing head of Grab Thailand told the Bangkok Post.
Chantsuda said food ordering remains unprofitable but continues to grow, and more customers are needed. "Most of the GrabFood users are 20-39, and we aim to attract office workers and university students to our platform.”
During the lockdown from March to May, GrabFood gained new users with orders surging by three times from the pre-pandemic period. According to Chantsuda, Grab's revenue from ride-hailing service was on a par with food ordering service in 2019 but the pandemic has depressed ride-hailing service by 90%, while the usage of food ordering and parcel delivery has risen.
There is still room to grow in the food ordering market, valued at 35 billion baht (US$1.1bn), when compared with e-commerce, estimated at 300 billion baht (US$9.6bn). According to K-Research, the food delivery market this year is projected to grow 19-21% this year, up from a previous forecast of 17%.
"The pandemic is accelerating the competition in the online food delivery segment," Anantaporn Lapsakkarn, a senior researcher at K-Research, told the Bangkok Post. "Instead of six years, we could see a winner in this segment within three years."
Last year, four major food delivery and ride-hailing players registered losses of more than 4.2 billion baht ($134.6bn) in total, according to fintech firm Creden.co. The four are Grab, Foodpanda, Get (Gojek) and Line Man.
Line Man, a unit of Japanese chat app Line Corp, recently raised US$110 million from BRV Capital Management and merged with restaurant review platform Wongnai and is in the process of reorganising with no major campaign launched yet.
Sourced from The Bangkok Post, Nikkei Asian Review