Industry Trends: 2024 Major Shake-up in Asia-Pacific Food Delivery Market

The Taiwanese food delivery market has recently undergone significant changes. On May 14, 2024, Uber announced the acquisition of Foodpanda’s food delivery business in Taiwan for USD950 million in cash, making it one of the largest international acquisitions in Taiwan outside the semiconductor industry. This acquisition will integrate Taiwan’s two major food delivery platforms, enhancing consumer choice diversity and creating more opportunities for delivery personnel.

Uber Eats’ success in Japan demonstrates its potential for sustained expansion in the Taiwanese market. Since entering the Japanese market in 2016, Uber Eats has become one of the country’s largest delivery networks, partnering with over 100,000 merchants and covering all 47 prefectures. This experience will help establish a solid foundation in the Taiwanese market quickly.

However, Delivery Hero, the parent company of Foodpanda, faces challenges in its expansion plans in other markets. Despite plans to sell parts of Foodpanda’s business in Southeast Asia (Singapore, Malaysia, the Philippines), negotiations fell through due to the inability to agree on terms. Delivery Hero is under pressure from capital markets to improve profitability, especially with stagnant business in Southeast Asia. The competition in this region is fierce, with Grab holding about 54% market share while Foodpanda only has around 19%.

In such a competitive environment, Delivery Hero must consider other ways to improve profitability, including reducing marketing, subsidies, and even increasing prices for partners and consumers. However, these strategies may further impact its market position and consumer trust.

For the Taiwanese market, Uber Eats’ acquisition and expansion will trigger new market dynamics. Industry decision-makers should closely monitor this change and actively adjust strategies to maintain competitiveness and innovation in a rapidly changing market. This acquisition will not only alter the competitive landscape of Taiwan’s food delivery market but also have profound effects on the entire Asia-Pacific food delivery industry.

According to the latest survey by Z.com Engagement Lab on the Asian food delivery market, six countries were analyzed: Taiwan, Japan, Thailand, Indonesia, Singapore, and Malaysia. The focus was on four major indices: industry direction, change demand, government regulation, and consumption intentions.

1. Industry Direction Index

This index indicates the confidence in the future development of the food delivery market in each country:

• Overall trend: Most countries hold a positive view of the future of the food delivery market. Taiwan (79%), Thailand (81%), Indonesia (84%), Singapore (70%), and Malaysia (71%) show significantly higher positive indices than negative ones, indicating high market confidence.

2. Industry Consumption Index

This index reflects consumers’ expected future spending on delivery services:

• Overall trend: Taiwan (56%), Thailand (78%), Indonesia (75%), Singapore (54%), and Malaysia (69%) expect to increase spending on delivery services.
• Special analysis: Japanese consumers have the lowest expected increase in spending on delivery services (21%), indicating that the market may have reached saturation or other limiting factors.

3. Industry Change Index

This index measures the appetite for change in the food delivery market in each country:

• Overall trend: Most countries believe that more industry change is necessary, Thailand (86%), Indonesia (89%), Taiwan (84%), and Malaysia (82%).
• Special analysis: Japan has the weakest demand for industry change (42%), reflecting that its market may be more stable or more reserved about change.

4. Government Control Index

This index reflects the expectations of the role of government in the food delivery market in each country:

• Overall trend: Most countries support reducing government control over the food delivery market, especially Thailand (69%), Indonesia (66%), Singapore (59%), and Malaysia (64%).
• Special analysis: Taiwan and Japan have a more neutral or slightly supportive attitude towards increasing government control.

Based on Z.com Engagement Lab’s survey analysis, the following are recommendations for industry decision-makers:

• Enhancing Market Confidence: In countries like Japan where market confidence is low, companies should strengthen marketing and consumer education to boost consumer confidence in delivery services.
  
  
• Increasing Consumption Incentives: In markets with low consumption willingness, companies should introduce more discounts and promotional activities to stimulate demand.
  
  
• Promoting Innovation and Change: Given the high demand for change in most markets, companies should enhance technological innovation and service improvements to increase market competitiveness.
  
  

These insights and recommendations aim to help industry decision-makers seize growth opportunities in the Asian food delivery market, promoting sustainable development and innovation in their businesses.

Z.com Engagement Lab will continue to track the attitudes of people in East Asian countries towards their domestic food delivery industry and update survey data, monitoring market trends and changes in consumer needs.