Vietnam leads Southeast Asia in food delivery growth

Its size expanded from US$1.4 billion in 2023 to $1.8 billion last year, according to "Food Delivery Platforms in Southeast Asia" done by venture capital firm Momentum Works.

Grab Food and ShopeeFood dominated the market with shares of 48% and 47%. BeFood had 4%.

GoFood by Indonesia’s Gojek had 1% before it withdrew in September last year.

Market growth was driven by all three components: users, eateries and platforms.

Vietnamese are increasingly preferring to order ready-made food through apps due to convenience and discounts.

A survey by market research company Q&Me found 30% of people have food delivered to them for lunch while the rates are 46% for home-cooked meals 12% for eating out.

Around the Lunar New Year holidays at the end of January, a GrabFood survey found 19% of respondents ordered food home for year-end parties.

Q&Me also found that many customers love to order snacks via delivery platforms, with 77% buying milk tea and 37% buying desserts and sweets.

Meanwhile, eateries are also actively signing up with platforms to find customers. In November 2024 GrabFood said the number of partners had increased by five times since its launch in June 2018.

Bui Thi Dung, owner of Pho Chao restaurant, said online channels provides her with a reliable flow of customers.

"Selling online reduces pressure at the restaurant, helps increase sales despite having a small area and, especially, provides the opportunity to reach distant customers."

Platforms have been competing by running discount programs, upgrading service features and adding entertainment features.

While GrabFood has developed more features such as group ordering, ShopeeFood recently adopted the shopping and entertainment (shoppertainment) strategy that had helped Shopee make waves in the e-commerce market.

ShopeeFood announced the hiring of five artists from a popular music show. During Lunar New Year, they live-streamed for nine hours to announces food order deals.

But Vietnam's food delivery market is smaller than its counterparts in Indonesia, Thailand, the Philippines, Singapore, and Malaysia.

Jianggan Li, Founder and CEO of Momentum Works, said after many years of prioritizing profits the leading food delivery platforms in Southeast Asia have regained momentum to drive the next growth phase.

"With better customer segmentation capabilities and improved operational efficiency, these platforms are now in a favorable position to take bold strategic steps to expand sustainably."

Grab, FoodPanda, ShopeeFood, and Gojek are the four largest in the region, but the market is likely to be shaken up with the entry of TikTok.

The Chinese platform has started experimenting with selling food vouchers and other services in Indonesia and Thailand.

Although still early its entry could change the food delivery market, especially if it collaborates with delivery services to fulfill orders, Momentum Works said.