Delivery Orders Rise Again... Market That Had Slowed Shows 'Recovery Trend'

Baemin, User Expansion Speed

The food delivery platform market, which showed signs of stagnation earlier this year, is recovering once again. Following the lifting of social distancing measures, dining-out demand has exploded, leading to a return of users who had decreased their use of delivery apps. The increase in people seeking convenient meals at home due to last month’s heatwaves and monsoon season also contributed to this trend. Baedal Minjok (Baemin), the market leader, is gaining the upper hand in the ‘single-order delivery’ competition with Coupang Eats and accelerating its user expansion.

According to Mobile Index by data company IGAWorks on the 15th, the number of users (MAU) in the delivery app category on Android and iPhone (iOS) smartphones reached 24.98 million last month. Despite the resurgence of COVID-19, the user base, which had hovered around 23 million, has grown to nearly 25 million, meaning about half of the population now uses delivery apps. The growth rate is also notable. In July, the increase was only 230,000 compared to the previous month, but this time it rose by 1.37 million in just one month.

Seasonal factors also appear to have played a part in the delivery app market’s renewed growth curve. In August last year, Baemin users increased by 740,000 compared to the previous month, while Yogiyo and Coupang Eats each saw an increase of around 200,000 users. Industry insiders particularly credit Baemin’s growth strategy for its effectiveness in the market. Last month, Baemin, Yogiyo, and Coupang Eats recorded 21.52 million, 7.66 million, and 4.34 million users, respectively. Baemin alone increased by 1.31 million users compared to the previous month, marking the highest monthly user count ever. Yogiyo and Coupang Eats also performed well, increasing by 58,000 and 153,000 users respectively, but their growth pales in comparison to Baemin’s. Considering the high number of overlapping users among delivery apps, it is fair to say that Baemin is leading the recent growth.

Baemin experienced a decline of 800,000 users from the end of last year through May, affected by the lifting of social distancing measures, but has shown gradual recovery since June and has now surpassed previous declines to reach an all-time high. Analysts suggest this is because the impact of factors that discourage delivery platform use?such as the end of social distancing, rising prices, and increased delivery fees?has diminished.

Baemin is accelerating its user expansion further. The recent growth trend indicates that Baemin has already gained an advantage in the single-order delivery competition with Coupang Eats, which began last year with the launch of ‘Baemin1.’ Accordingly, Baemin plans to expand the Baemin1 service area next month to include Cheongju City in Chungcheongbuk-do, Jeonju City and Wanju County in Jeollabuk-do, and Changwon City and Gimhae City in Gyeongsangnam-do. This move is part of efforts to establish a nationwide service network that includes major cities and counties following the metropolitan areas and large cities. A delivery industry official said, “Although Baemin is far ahead, with delivery orders increasing again and many ‘multi-homing’ users selectively using delivery apps, competition among companies to capture these users will intensify.”