How new player joined Vietnam's food delivery battle

January 11, 2021 | 02:00 am PT
Joining the market later than competitors, Baemin, a food delivery application of South Korean unicorn Woowa Brothers, concentrates on rider training and supporting food stores.

Professionalism and concentration

Tuan, 28, from HCMC, is on his way to the headquarter of Baemin in District 3 to take part in a training course. He said, by the end of the course, he would have had to take an entrance exam before being granted an account as a Baemin rider. Before that, during the online application process, Tuan also had to undergo a pre-qualification exam before attending the intensive training.

Most riders joining the Baemin network have to pass two entrance exams, a paradox compared to other food delivery businesses today.

"We want to leave a good first impression on our customers with Baemin's well-mannered and polite rider team," said Nguyen Trung Thanh, COO of Baemin Vietnam, Woowa Brothers' leading online food delivery service.

Baemin Raider delivery food to customer. Soucre: Baemin

A Baemin rider delivers food to a customer. Photo by Baemin.

Right after taking the lead in South Korea, Woowa Brothers expanded its market to Vietnam, where more than 40 percent of the population is of working age, loves technology and is quite familiar with Korean culture. However, Baemin still joined the Vietnamese market later than many other competitors.

The boom in delivery applications has resulted in a shortage of riders and problems with service quality. Therefore, Baemin chose its own path by starting with careful training of its rider team in each market then gradually expanding within the city where the demand for food delivery is up to 90 percent (according to market research company GComm).

Ho Chi Minh City and Hanoi are two typical examples of Baemin's approach. "In Vietnam, FoodTech is still a very new market, so companies in this field have to invest a lot in building their own delivery team and putting them into operation," Thanh noted.

Accompany with partners

Baemin focuses on building professional food delivery services, its professionalism helping it success in a short period.

According to a recent Asia Plus survey, although Baemin only appeared in Vietnam from mid-2019, it quickly caught up with Gojek, another application in food delivery, in its proportion of users (up to 46 percent). Baemin also takes up 16 percent among the most frequently used apps.

According to the report, GrabFood is said to be popular among the old while Baemin suits younger generations.

Grab Food is more popular at the elders while Baemin is more popular at youngsters and HCM. Now is supported by female. Source: Q&Me Vietnam Market Research.

GrabFood is more popular at the elders while Baemin is more popular at youngsters and Now is supported by female. Graphics by Q&Me Vietnam Market Research.

Investing in rider partners is not enough in Baemin's long-term development strategy in Vietnam.

"In Korea, where third-party logistics infrastructure is already developed, Woowa Brothers focuses on customer care, advertising and tradition," said Thanh.

"However, in Vietnam, it is a completely different story."

In addition to delivery resources, Baemin also has to pay attention to connecting with partners participating in its platform by providing flexible payment methods, with the most important being accompanying partners in the transition of business model into online format.

According to Thanh, in new markets like Vietnam, restaurants and stores, especially traditional ones, are yet to grow accustomed to online sales. Thus, during this period, the most practical thing is generating a revenue stream.

Baemin's strategy is to send staff to guide restaurant owners on how to achieve greater profits. At the same time, the company has also developed a department to timely respond and make payments so restaurant owners could continue to operate.

"These are very basic steps, but they create real value from which the restaurant has confidence to establish a closer relationship with us," Thanh emphasized.

In the coming time, Baemin plans to help restaurant owners create products suited to online business models. According to Thanh, this would allow transformation from a pure traditional restaurant to an online model in order to gradually expand with increasing revenue.

"More than anyone, Baemin understands that the success or failure of a company depends greatly on its partners. Although Baemin is newly launched in Hanoi, brand awareness of customers here is much higher than in Ho Chi Minh City. It may be a new city, but the market has heard a lot about us," Thanh said.

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