Thailand has a large and diverse market for food delivery apps, thanks to its population of more than 69 million, its growing middle class, and its rich food culture.
In a society where convenience reigns supreme, food delivery applications have revolutionized the way many people access meals. A recent study conducted with Rakuten Insight Global’s exclusive Thai panel revealed the behaviors and choices of Thai consumers in regards to using these apps for ordering food.
A significant 67% of Thai participants admitted to using food delivery apps multiple times each month, with up to 10% ordering several times a day.
In this article, we will look at the current situation and the future potential of the food app startup ecosystem in Thailand, with a focus on three main players: Grab, Line Man, and Foodpanda.
- A staggering 67% of Thai respondents admitted to ordering from food delivery apps at least several times per month.
- Approximately 21% of the respondents in Thailand rely on food delivery apps three to six times a week.
- 10% of surveyed respondents confessed to indulging in several orders per day
Source : Rakuten Insight – Trusted Research Partner for Asia, US & Beyond
How the Market Grew from 2021 to 2023
The food delivery market in Thailand has seen a rapid growth in the past few years, especially during the COVID-19 pandemic, which increased the demand for convenient and contactless food delivery options. A report by Statista showed that the market value of food delivery in Thailand increased by 62% in 2021, reaching 51.5 billion baht (about 1.6 billion USD).
Among the food delivery apps that operate in Thailand, Grab, Line Man, and Foodpanda are the most popular and competitive ones. Grab is a super app that offers ride-hailing, food delivery, digital payments, and more. It has been leading the food delivery market in Thailand since it launched GrabFood in 2018. The market leader in terms of market share is GrabFood, which is a subsidiary of the Singapore-based ride-hailing and food delivery company, Grab
Line Man is a food delivery unicorn that is backed by Line Corp and GIC. It was created in 2020 from the merger of delivery service Line Man and restaurant review platform Wongnai. Line Man has been adding more services and features, such as grocery delivery, quick commerce, and cloud kitchen, to compete with Grab and other rivals. Line Man also raised $265 million in 2021, valuing the company at over $1 billion.
Foodpanda is the food delivery arm of Berlin-based Delivery Hero. It has been operating in Thailand since 2012. Foodpanda has spent a lot of money on marketing, technology, and infrastructure to increase its market share and customer base. Foodpanda also launched its cloud kitchen network, Pandamart, in 2020, offering a variety of products and brands for delivery.
Who is Leading and What are the Challenges
The food delivery market in Thailand is very competitive and dynamic, with frequent changes in consumer preferences, regulations, and technologies. While Grab is currently the market leader, Line Man and Foodpanda are not far behind, and they are always innovating and improving their services to attract and retain customers. There are also other players in the market, such as Gojek, Robinhood, and Lalamove, that offer similar or complementary services.
The food delivery market in Thailand also faces many challenges, such as rising costs, low margins, high customer acquisition costs, and regulatory uncertainties. The food delivery apps have to deal with increasing expenses, such as driver incentives, commissions, and promotions, while keeping low prices and high quality for customers.
The food delivery apps also have to compete for customers’ loyalty and attention, as they tend to switch between different platforms depending on availability, convenience, and discounts. Moreover, the food delivery apps have to follow the changing and complex regulations of the Thai government, such as taxation, licensing, and safety standards.
Huge opportunities amidst fierce competition
The food app startup ecosystem in Thailand is one of the most exciting and promising sectors in Southeast Asia, with huge opportunities and challenges. The food delivery market in Thailand is expected to grow more in the next few years, driven by the increasing demand, supply, and innovation of food delivery apps.
Grab, Line Man, and Foodpanda are the leading players in the market, but they also face fierce competition and various difficulties. The future of the food app startup ecosystem in Thailand will depend on how well the food delivery apps can adapt, differentiate, and collaborate in the fast-changing and complex environment.
