Eliminating Duplicate Store Listings to Enhance Ordering Convenience
Reflecting a Sense of Crisis Amid Coupang Eats' Close Pursuit
Kim Beom-seok, CEO of Woowa Brothers appointed this January, has revealed the outline of his inaugural emphasis on 'customer-focused innovation.' Starting next month, the Baedal Minjok app will integrate stores with the same name and address into one to enhance ordering convenience. The order in which stores are displayed will also be determined based on criteria that improve customer utility, regardless of the delivery method. This strategy aims to strengthen fundamental competitiveness by increasing the number of users through improved customer experience amid fierce competition from Coupang Eats.
According to Woowa Brothers on the 3rd, through the upcoming reorganization next month, stores displayed on Baemin will be sorted without duplication, considering factors such as order volume, reorder rate, and estimated delivery time. Previously, even the same store was displayed separately depending on whether Baemin delivered directly or the store used a delivery agency, causing customer confusion. For stores using both methods, searching by name would show two entries on the Baemin app, making it confusing where to order from. By merging these into one, the display order will not favor any specific criteria or delivery method; stores with higher order volume or reorder rates and shorter estimated delivery times based on the user's address will be displayed at the top.
This issue was also raised by CEO Kim during his first company-wide announcement on the 8th of last month. He questioned the existing app structure that requires customers to distinguish between food delivery and store delivery when searching for restaurants, asking, “Are we prioritizing customer experience? Can customers order their desired food more conveniently than on any other app?” He expressed his intention to focus on improving the app so that customers can select stores and food conveniently and intuitively. This reorganization will begin sequentially starting from Sejong City on the 7th of next month and will be applied in Seoul on March 21.
Additionally, Baemin has decided to discontinue the 'Ultracall' product, accepting some revenue loss to resolve customer inconvenience caused by duplicate listings. Ultracall was a fixed-rate product costing 88,000 KRW per month, commonly referred to as ‘flag planting.’ It meant that by paying a fixed fee, store owners could ‘plant flags’ in desired areas. However, the excessive flag planting by certain stores led to duplicate exposure in the app and increased orders, causing excessive cutthroat competition among store owners. Baemin plans to start ending Ultracall on April 1 in areas such as Gangnam-gu, Seoul, and complete the process by August.
CEO Kim stated that these reorganization plans are "to put the company back on the path of growth." Although Baemin still maintains a clear lead as number one in the delivery app market, growth has stagnated, and this is an attempt to find a breakthrough.
According to IGAWorks Mobile Index, Baemin’s monthly users remained around 22.4 million in both January and December last year, showing little change. In contrast, second-place Coupang Eats saw a 74% increase in users and a 118% increase in card payment amounts over the year. Although Coupang Eats’ users are still about half of Baemin’s, its estimated monthly card payment amount has reached about 60% of Baemin’s. Analysis shows Coupang Eats has higher average spending per order and reorder rates. Its share of card payment amounts rose from 18.4% in January to 35.3% in December, an increase of 16.9 percentage points. Baemin’s share decreased from 71.4% to 57.6% during the same period.
An industry insider said, "Baemin’s efforts to improve customer experience, such as simplifying the previously criticized complex app interface and order flow, reflect the current sense of crisis at Baemin," adding, "Changes in delivery quality and customer service are also expected to continue this year."
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