'Ddingdong' Dawn Battle... Fresh Food Delivery Orders Increased More in April than in March

Market Kurly April Orders Up 123% Year-on-Year
SSG.com Averages Around 120,000 Orders Daily
Oasis Gains 1,000 New Subscribers Daily
High Sales Growth Rate Also Seen in Non-Food Items

[Asia Economy Reporter Minyoung Cha] As the COVID-19 pandemic enters a lull, the number of users of fresh food delivery services is exploding. Following February and March, April also saw a steady increase in both users and new subscribers as the number of confirmed cases began to sharply decline, raising expectations for continued growth this year.

◆ Fresh Food Delivery Orders Surge in April = According to industry sources on the 4th, Oasis Market, operated by Oasis, a subsidiary of GeoSoft, recorded a 411% increase in average daily orders in April (1st to 28th) compared to the previous year. This triple-digit growth follows 722% in February and 362% in March. During the same period, the average daily number of orders rose 3.63 times to 7,622. On the day with the highest number of orders, it reached 9,395. In March, orders peaked at around 13,000, frequently causing early cutoffs for dawn delivery. The number of new member sign-ups also increased from about 600 per day to 1,000.

Emart affiliate SSG.com also saw a 48% increase in monthly sales for SSG Delivery in April (1st to 28th) compared to the previous year, continuing the upward trend from 60% in February and 45% in March. The average order fulfillment rate has remained between 90% and 95% since mid-March, currently at 94%. With a maximum daily delivery volume of 130,000 including dawn deliveries, it is estimated that about 120,000 orders are being processed daily. SSG Delivery operates based on the automated logistics center system 'Neo.' Although SSG.com does not disclose the number of dawn delivery orders separately, it is known that users have rapidly increased due to the COVID-19 situation. Market Kurly, which holds the number one position in the fresh food market, saw a 123% increase in average daily orders in April compared to the previous year, maintaining growth following 129% in February and 110% in March. Given that last year's average daily orders were around 35,000, it is estimated that this year’s orders have reached close to 80,000 at peak.

While the pandemic caused the worst March for the distribution industry, online shopping specialists benefited from the situation. According to the Ministry of Trade, Industry and Energy, online retailers’ sales growth rate in March reached 17%. Among these, food sales rose by 75%, and categories such as books & stationery (35%) and household & furniture (including hygiene products) (33%) also showed high growth rates. This contrasts sharply with department stores’ same-store sales dropping by 40% and large supermarkets by 14%.

◆ Consumer Sentiment Remains Frozen = Although the COVID-19 situation is calming, consumer sentiment remains in a deep freeze. This is due to increased unpaid leave and unemployment, which have worsened job security. According to the Bank of Korea’s 'April Consumer Sentiment Survey,' the Consumer Confidence Index (CCSI) dropped 7.6 points from the previous month to 70.8, the lowest since December 2008 (67.7). March saw the largest drop on record. The CCSI uses the long-term average (January 2003 to December 2019) as a baseline (100), with values above 100 indicating optimism and below 100 indicating pessimism. Since February, the CCSI has remained in a 'pessimistic' state due to the impact of COVID-19.

While consumption remains sluggish, fresh food orders by housewives are surging, presenting a contrast. Experts predict that even after the COVID-19 crisis ends, online-centered consumption tendencies will expand further. Yoo Inyoung (pseudonym), a member of a mom caf? in Seongdong-gu, said, "I receive meat via dawn delivery to prepare baby food." Another member, Kim Jimin (pseudonym), said, "I buy a lot of baby food ingredients through fresh food companies," adding, "Due to health concerns and fear of infection, I have not left the house for four weeks, so this is a good alternative." Demand for meal kits and other substitutes for dining out has also surged.

A GeoSoft official said, "Before COVID-19, the number of orders was around 6,000 to 7,000, but after the pandemic, it surged to about 13,000," adding, "The average order value rose from the mid-40,000 won range to over 50,000 won, and is currently maintaining the high 40,000 won range, showing generally positive figures."