Motorbikes for food delivery are parked outside an outlet of food delivery app Yogiyo in Seoul on June 2, 2020. (Yonhap)
SEOUL, Aug. 7 (Korea Bizwire) — Kakao Corp., operator of South Korea’s largest messenger app, KakaoTalk, plans to introduce a new food delivery service, raising worries over the impact it may bring to the country’s delivery industry.
NowBusking, a Korean startup that Kakao has made a significant investment in purchasing 26 percent of its shares, recently submitted a plan to introduce a new delivery service known as ‘Good Delivery’ to the Korea Franchise Association, according to industry sources.
NowBusking currently runs KakaoTalk’s Chatbot Ordering Solution.
The so-called ‘Good Delivery’ service uses KakaoTalk to connect food vendors with consumers.
KakaoTalk users don’t have to download a separate app to use the delivery service, since it uses the messenger app as its primary platform.
‘Good Delivery’ aims to attract membership by touting its 1.5 percent commission rate per order, which is almost 10 times lower than rates offered by competitors.
The company also set up a limit to the maximum amount of commission, where member stores are only charged a maximum amount of 100,000 won (US$84.35) if monthly commissions exceed that amount.
Good Delivery’s strength is not just in its low commission rate, but also the platform it uses — KakaoTalk.
NowBusking expects that using KakaoTalk as primary platform will speed up business expansion, since KakaoTalk users don’t have to download a separate app to access Good Delivery services.
All they have to do is look up the food vendor of choice on KakaoTalk, and send a KakaoTalk message to place an order.
This new project has put Baemin, Yogiyo, and other delivery service platforms on notice.
“Kakao’s financial clout and KakaoTalk’s dominance in South Korea may overturn the delivery market in no time,” an industry official said.
H. M. Kang (hmkang@koreabizwire.com)
