Online Food Delivery Industry Still Growing in Indonesia

BUSINESS AND TRADE - JAKARTA. The Online Food Delivery (OFD) is still a choice for the Indonesian people in buying food and beverages when the activities have been normal again after Corona pandemic. This is reflected in various surveys conducted by research institutions at home and abroad.

One of them is a survey by Measurable AI. The global research organization recently released a report titled Asia Online Delivery Report: Food + Grocery. Measurable AI analyzed OFD market trends over the past four years (2019-2022) in nine Asian countries namely Singapore, Malaysia, Thailand, Philippines, Hong Kong, Taiwan, India, Japan, and Indonesia.

Its research results state that the OFD industry continues to show positive growth in various countries. “The pandemic has brought about rapid changes in the online food delivery industry, and delivered a noticeable shift in consumer spending habits. Looking at Asia alone, Measurable AI’s data set reveals that consumer demand for online food delivery has increased consistently during the pandemic and into the post-pandemic,” Measurable said in its report as quoted on Tuesday (07/02/2022).

In addition to the growing demand for OFD services since 2019, the average per-transaction value or Average Order Value (AOV) has also increased in several countries. One of them is Indonesia, where the increase is quite high, which is almost 50% from around Rp40,000 in 2019, it rose to Rp60,000 in 2022.

The analysis was obtained by Measurable AI from e-receipt data of transactions made by a panel of consumers who had agreed to share their data with Measurable.

This transaction data is then processed to provide an overview of OFD trends. This method is considered more robust because it is supported by real data that is more accurate than research using survey methods that only rely on the memories of respondents.

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From transaction data collected by Measurable AI, Gojek's GoFood platform is slightly ahead of GrabFood in market share among Indonesian consumers.

Measurable AI also revealed that consumers in Indonesia are the most loyal to the OFD platforms they use when compared to other Asian countries. There are only 8% of consumers who often change OFD platforms (GoFood and GrabFood). The rest consistently use GoFood or GrabFood only.

In contrast, Taiwan, Hong Kong and Japan have the lowest loyalty rates among the nine countries analyzed. In Taiwan and Hong Kong, for example, 28% of OFD consumers in these countries often use different platforms to order food.

The trend of online food delivery services in Indonesia is also evident from research conducted by Populix, a domestic research and consumer insights company. In accordance with its title, Understanding Food and Beverage Trends in Gen Z & Millennials, Populix focused on conducting research on the two generations, Z and millennials.

“Gen Z and Millennials are the two largest generational groups, not only in Indonesia, but also in the world today. These two generations are the population groups that have contributed the most to buying and selling and consumption activities in recent years and for the next few years,” Populix said in its research.

A total of 3,138 people were respondents, consisting of 1,590 Generation Z and 1,548 Millennials.  The research found that Gen Z and Millennials (57%) buy food from outside more often than cooking their own food or eating what is available at home.

Both Gen Z and Millennials see food as a primary need in their daily lives, so it has the potential to be the main driver of OFD transaction value growth going forward.

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In a week, Gen Z and Millennials order food online two to three times. Even Gen Z has a tendency to buy food online in a higher frequency than millennials. “Price is the top consideration for Gen Z and Millennials, but they also pay attention to the quality of service and the availability of promos from E-Commerce,” wrote Populix.

There are three platforms or applications for Gen Z and Millennials to order culinary online. They are GoFood, GrabFood, and Shopee Food. Where GoFood is the most widely used application by both generations, reaching 46%. While GrabFood 32%, and Shopee Food 22%.