Industry to develop 300 million customers
The online food delivery market in India is expected to expand at compound annual growth rates of ~30.55% (based on revenue) and ~10.19% (based on the number of users) during the 2020-2024 period.
Based on the CAGR, the industry would generate a revenue of Rs.~1,334.99 billion and develop a user base of ~300.57 million, according to the “Online Food Delivery Market in India 2020” report from ResearchAndMarkets which was released on 21 Apr 2020.
The online food delivery market in India is growing in tandem with evolving lifestyle patterns and eating habits of Indians. Hectic work schedules and rise in disposable incomes have popularized food delivery, especially in urban areas, said the report.
Major players currently operating in the Indian online food delivery market include platform-to-customer service providers like Swiggy (Bundl Technologies Private Limited), FreshMenu (FoodVista India Private Limited), Faasos (Rebel Foods Private Limited) and Zomato (Zomato Media Private Limited).
Apart from these, there exist certain companies that operate with a restaurant-to-customer delivery model like Box8, Domino’s (Domino’s Pizza, Inc.), and KFC (Yum! Brands, Inc.).
As of 2019, millennials accounted for ~63% of the overall user base of the online food delivery market. This is owed to increasing disposable income of the millennials, especially in the urban regions in India.
Also, millennials prefer ordering food online since it is easy to handle and saves time and energy of cooking at home.
In 2019, out of the major online food delivery service providers, Zomato held a share of ~38% in terms of user base. Swiggy held a share of ~27% in the online food delivery user base of India in 2019.
High adoption rates in tier I and tier II cities, as well as swift delivery services has helped these two companies to gain the high share in the Indian market.
In the recent years, the number of working women has increased in the Indian workforce, especially in the city-based organized sectors.
As a result, the number of double income families in also on the rise. With both the partners working and maintaining hectic working schedules, it become difficult for people to get time and energy to cook at home.
Moreover, the dual income scenario has increased the overall spending capacity of the families. Also, the key players like Swiggy, and Zomato keep on announcing lucrative offers for the customers, both existing and new, in order to keep up the stiff competition in the online food ordering market.
But there have been several instances of spurious and closed restaurants; and food shops taking orders on food platforms, only to be informed later that either the shop cannot be located or had shut operations. Cases were reported where certain outlets registered on these food delivery apps have turned out to be makeshift, or operate out of home joints, with hardly any focus on hygiene and quality.
This has caused annoyance among both the customers and the food delivery executives. Also, consumers are becoming concerned about the quality of food since such unauthorized food stalls seldom maintain hygiene both while cooking and packaging.
The industry leaders are Box8, Bundl Technologies Private Limited, FoodVista India Private Limited, Rebel Foods Private Limited, Zomato Media Private Limited, Domino’s Pizza and Yum! Brands. fiinews.com
