The US DoorDash food delivery app was launched in Japan, marking the company’s first foray into the Asian market and the latest move by a large delivery group to expand to the globe in an effort to exploit a pandemic boom. driven in demand.
DoorDash, the U.S. market leader, said the move will give it access to one of the most “restaurant-dense countries in the world,” even if it starts relatively small.
Emulating its U.S. strategy, where it was first focused on suburban areas outside major cities, DoorDash said it had ruined “hundreds” of restaurants in Sendai, a city north of Tokyo with a population of about 1m.
“It’s a very poorly served market,” Tony Xu, executive director, told the Financial Times on Tuesday, describing Sendai as a “microcosm” of the country as a whole. “Nationally in Japan, based on what we’ve seen, the most generous estimates are at 10 percent of merchants adopting delivery. So I think that’s just the first few days.”
Of Japan restaurant culture means that people tend to plant and eat on the way home, rather than ordering food for delivery, but participants see an opportunity in the growing population of retirees and dual-income families.
The move came as large delivery app companies expanded aggressively into new markets, believing that habits formed during pandemic closures would become permanent. At the height of blockchain measures in the United States, DoorDash revenues have jumped more than 200 percent, stimulating a initial blockbuster public offering which raised nearly $ 3.4 billion for the company.
Last month, the FT said that DoorDash was preparing to launch in Germany, another highly contested market that pits the company against Just Eat Takeaway.com and Delivery Hero as well as Uber Eats, which said April which is expected to launch into Europe’s largest economy in “weeks”.
Meanwhile, through his acquisition of Grubhub, which has yet to close, Just Eat Takeaway will establish its first presence in the United States, putting the U.S. DoorDash market share of more than 50 percent threatened.
In Japan, DoorDash will face off against well-known opponents as well as well-established local players.
“It’s definitely going to be very difficult,” Xu said. “When we talk about an investment like Japan, we’re talking about a multi-year investment, over a decade.”
Uber Eats was launched in the country in 2016, followed in 2020 by Delivery Hero and China’s Didi Chuxing. Tokyo headquarters, Demae-can, has partners with nearly 60,000 merchants and has 5.82 million active users. It also offers a wider range of services, such as mail order and dry cleaning.
DoorDash will also struggle with a number of powerful local companies in adjacent markets, including food delivery cooperatives and Yamato and Sagawa parcel services.
While DoorDash began to expand in convention articles in the United States, Xu said he will not rush to make similar moves in Japan.
“He crawls, walks, runs,” he said. “We certainly don’t want to make mistakes by just trying to copy and paste what we’ve seen possible work in other geographies. I think for us, we have to build a very Japanese product.”