SEOUL, Korea, April 11 (Korea Bizwire) – Striving for supremacy in the 10-trillion-won food delivery market, two start-ups came to gripes.
The one leading the competition is Woowa Brothers, the service provider of Korea’s No. 1 mobile food delivery application, “Baedal Minjok (the People of Delivery).” The challenger is RGP Korea founded by a German venture Team Europe, which introduced “Yogiyo,” the Korean adaptation of “Delivery Here,” currently in service in Germany, England, and Australia.
Some even view it as a competition between a domestic start-up and a German venture. As both mobile application providers have recently scored a 10-billion-won investment fund each, their battles are getting as ferocious as they can be.
Last March, the No. 2 delivery app Yogiyo’s service provider RPG Korea announced that the company has recently received a 14.5-billion-won investment from Insight Venture Partners, a New York-based venture capital firm which have also funded Tweeter, Tumblr, Nexon and TicketMonster.
A RPG Korea official explained that such generous investment was due to the fact that Yogiyo’s sales turnover has increased by 50 times over the previous year with the number of orders made through the app consistently increasing by 25 percent each month.
It has only been two months since the market leader Woowa Brothers received a sum of 12-billion-won investment from several venture capitals including ALTOS Ventures, IMM Investment and Stonebridge Capital.
Baedal Minjok which came in service in Korea in June 2010, two years prior to Yogiyo, has been leading the domestic market. As of last year, Baedal Minjok had 60 percent of the market share.
However, Yogiyo has caught up aggressively by running advertisements incessantly over the terrestrial TV and cable TV channels since last December. According to Nielsen Korea, Baedal Minjok’s market share has dropped from 58 percent in January 2013 to 45 percent in February 2014.
Over the same period, Yogiyo’s market share has increased from 14 percent to 39 percent. The gap in the number of monthly net visitor counts also has closed in from 800,000 to 190,000.
Threatened by such a close chase, Baedal Minjok hired popular screen actor Ryu Seung-ryong as the mobile app’s spokesperson. There have been speculations that the two companies are pouring 3 billion won on TV commercials.
An industry insider said, “The competition is just about to be started, for the two companies only have 10,000,000 users until now while the entire adult population in Korea is 35,000,000.”
Written by Robin Koo (firstname.lastname@example.org)