The massive and fast growing 90 billion food delivery

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The massive and fast-growing €90 billion food delivery market is driven by global trends, including booming smart-phone usage, younger populations of “digital natives” in emerging markets, and a growing global middle class (Foodpanda, 2017). Online food delivery services are the newest addition to this sector. These services in Bangladesh began in mid-2013 with HungryNaki, a local entrepreneurship. Soon thereafter, global orga- nization Foodpanda joined the competition in late 2013. Following these, three more companies have joined the market of online food delivery service. Online food demand depends on internet availability and usage. Internet usage has had a great impact in the flourishing e-commerce sector, as internet users in Bangladesh increased enormously in the past 5–7 years. In February 2017, the Bangladesh Telecommunication Regula- tory Commission (BTRC) pointed out that approximately 93.87 percent (63.120 million) of internet users use the internet through mobile networks, and 6.13 percent (4.125 million) use broadband internet (WiMAX and SAGE © Jashim Uddin Ahmed and Asma Ahmed 2018 SAGE Business Cases Page 3 of 12 Foodpanda: Changing the Way Bangladeshi Eat Meals
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ISP+PSTN). This significant growth in internet usage helps users to place online orders quickly and also to receive promotional information instantly. The continuation of this growth will expand the online food delivery service in Bangladesh within the next few years, which will benefit market players. Moreover, monetary value offered to customers is also improving radically as technological advancement reduces marketing costs, effort, and time. The higher internet usage has resulted in increased usage of social media websites and mobile applications, such as Facebook, Insta- gram, and Snapchat. Similarly, the extreme usage of social media sites results in increased value of online food delivery services. Compared with other promotional broadcast and print media, a Facebook promotional rate of USD 7 per day is cheaper. Facebook guarantees that these promotions reach narrowly defined tar- get markets. Shares, likes, and comments on Facebook spread information and offers rapidly from one cus- tomer to another. In addition, Facebook facilitates the ability of a firm to select their target market precisely, using tools that guarantee that a firm will receive hits on their offerings and promotional activities. Currently, Foodpanda has over 2.5 million followers on its Facebook page. Alongside Foodpanda, there are other local competitors that provide online food delivery service such as HungryNaki, Justknockbd, Mojadar, and Food- mart. These companies offer customers an online ordering system from partnered restaurants with the option of online payment followed by delivery service. As such, online is the rudimentary platform for customers to place orders through these sites.
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