Baemin Dominates, Widening the Gap with 2nd and 3rd Place

19.87 Million Baemin Users in January... 4.2% Decrease YoY
Difference from Yogiyo's 23.3% and Coupang Eats' 46.8% Decline

[Asia Economy Reporter Kim Cheol-hyun] In the domestic delivery application (app) market, Baedal Minjok (Baemin) is solidifying its dominance. Although the overall number of delivery app users has decreased over the past year, Baemin, the market leader, experienced the smallest decline. In contrast, the second and third-ranked apps, Yogiyo and Coupang Eats, saw a significant drop in users over the year, widening the gap with the leader. Naturally, the strategies of the three companies this year have diverged. Baemin is focusing on operational efficiency to maintain its position, while the second and third-ranked companies are aiming for a turnaround through delivery of non-food products.

On the 7th, data company IGAWorks reported through Mobile Index that Baemin had 19.87 million monthly active users (MAU) on Android and iPhone (iOS) smartphones last month. Yogiyo and Coupang Eats had 6.84 million and 3.5 million users respectively. The total number of delivery app users was 22.91 million, down about 1.68 million compared to the same period last year. The decline in delivery app users is attributed to the COVID-19 endemic effect combined with recent high inflation. Demand, which had increased due to social distancing measures, has decreased, and rising food prices have made users more reluctant to pay delivery fees.

However, the scale of user decline differs among the three companies. Users often install multiple delivery apps and selectively use them depending on the situation. While the overall number of users has decreased, the impact on each company varies. Baemin had 20.73 million users in January last year, decreasing by 860,000 users or 4.2% over the year. Yogiyo saw a decrease of 2.08 million users, a 23.3% drop. Coupang Eats lost 46.8% of its users, effectively halving its user base. The gap between first and second place was about 11 million last year but has expanded to around 13 million this year. This is attributed to Baemin’s continued market lead and its swift response to latecomers’ differentiation strategies such as single-order delivery.

The strategies of each company inevitably differ. Baemin is focusing on efficiency. A representative example is the introduction of a 'distance-based delivery tip function' for partner restaurants starting from the 1st of this month. Previously, delivery tips were set by administrative district units. The distance-based delivery tip is calculated based on the straight-line distance between the customer's address and the actual location of the store. This resolves issues with accurately setting delivery tips in areas where administrative districts have changed.

Yogiyo and Coupang Eats are focusing their strategies on quick commerce, which involves immediate delivery of various products. They recognize the limitations of competing solely through food delivery. Coupang Eats currently offers 'Coupang Eats Mart' in parts of Songpa-gu, Gangnam-gu, and Seocho-gu in Seoul. Customers can receive a variety of products available at the mart through immediate delivery without a minimum order amount. The service area will continue to expand.

Yogiyo partnered with GS Retail this year to launch a service that allows customers to receive convenience store products within an hour. Following last year's launch of 'Yomart,' a nationwide fresh food and daily necessities shopping service, Yogiyo is expanding its quick commerce business using its delivery infrastructure. Park Woo-hyun, head of Yogiyo’s New Business Division, said, "With the launch of quick commerce services from Yomart to Yopyeon Convenience Store, we can provide customers with differentiated ordering experiences and choices. We will ensure that everyone can conveniently experience immediate delivery services."