Business Model of Foodpanda & SWOT Analysis
Foodpanda is a reputable name that connects people to numerous local food points in the online food and grocery delivery sector. You can order food of your choice through Foodpanda app. Users can search thousands of food points available in their vicinity and avail home delivery or pick-up options. And the best thing is that it takes only a few steps to order food. Currently, it is working in various countries including Pakistan, India, and Bangladesh. You can share your reviews about the food you ordered. Well, the main question is, how do they generate money?
It is important to tell you that the food-delivery sector is really competitive, and Foodpanda successfully manages its operations. This business model of Foodpanda will give you a complete insight into how they make money.
It was launched in 2012 in Singapore. With the passage of time, the company expanded to sixteen countries. Except for China, it is Asia’s largest food and grocery delivery company. They have aimed to expand their reach to more than 40 countries, including the Middle East, Africa, Europe, Asia, and Latin America. Its rapid expansion shows that the company will achieve this target in the future. These goals are only achievable with the proper management and right strategies.
Marketing Strategy of Foodpanda:
Promotion:
The progression of any business depends on effective marketing. Today, digital marketing is one of the most effective tools. It plays a big role in the marketing strategy of Foodpanda. The company uses email marketing to show offers, incentives, and promotions.
They also exploit social media platforms to advertise their offers and ads. They have a popular Facebook page where you can see the latest updates about the brand. On the other hand, Foodpanda has a Twitter account with thousands of followers. It helps the company to increase its brand worth and visibility.
Foodpanda is also famous for its catchy slogans, offers, and discounts. These things play a huge role in the promotional campaigns of Foodpanda. They also use other platforms like TV, radio, hoardings, newspapers, and magazines for promotion. In 2015, the company cracked a deal with the Indian railways, which allow travelers to order food online by utilizing the platform of the Indian railway.
Price:
Everyone wants to know the reason behind the immense popularity of Foodpanda. According to business experts, they succeeded due to their pricing strategy. The company has followed a value-based pricing strategy.
Foodpanda offers high-quality food to users at a competitive cost. They regularly provide incentives like offers and discounts to users. It helps them to retain their customer base even in the busy food delivery marketplace.
Distribution:
A Germany-based company, “Delivery Hero SE” is the owner of Foodpanda. According to an estimate, the company has associated with 40000 restaurants globally. So, users can order meals through its mobile app or website. This strong network shows the stability of Foodpanda’s distribution. The company started its operation in Singapore and now it is operating in major parts of the world. They have a strong distribution network in India. They have strong partners from fast-food brands to desi restaurants, ice creams, beverages, and many more.
Experience:
The company’s main aim is to provide delicious and high-quality food to the doorsteps of users without hassle. It is a great platform that connects millions of users to their favorite restaurants. If you want to experience the service of Foodpanda then locate food points on Foodpanda app available in your area. Browse menus and meals to order your desired food. Once you have selected your food, add it to the cart and enter your location. You will receive a confirmation SMS on your number or email. Your order will be delivered quickly to your doorstep. You can also share your opinion about food and delivery on Foodpanda mobile app.
Business Model of Foodpanda:
Online Orders:
We are talking about online food delivery, and Foodpanda maintains a mobile app and a website. People can use these platforms to order food online from their favorite restaurant or food point.
Accessibility:
In this era, everyone holds a smartphone, and you can search for your favorite restaurant on Foodpanda app. Once you find the restaurant, you can choose your meal and get home delivery.
Easy Payment Process:
Foodpanda offers both cash on delivery and online payment methods for paying the bill. This kind of easy and effective payment gateway makes it highly popular.
Quick Delivery:
Once you place an order, a confirmation will arrive. Moreover, you will get fast delivery of your food.
Live Tracking:
For us, this is the most exciting feature. You can track your order through Foodpanda app or website.
Revenue Model of Foodpanda:
Foodpanda Charged Registration Fees from the Restaurant:
The company charges a specific registration fee from the food point/restaurant to add the latter on its mobile app or website. After this, it becomes visible to users for ordering food. It ranges between 100 to 150 dollars. Plus, it is a one-time registration fee.
Commission from Restaurant:
The company charges a particular commission from restaurants on every order from the Foodpanda platform. The amount of commission varies. It depends on the location and menu of the restaurant.
Delivery Charges from Users:
Foodpanda also charges a delivery fee from customers on each order. On the other hand, you have to pay taxes according to your country’s rules.
Ads:
For many food points and restaurants, Foodpanda is an excellent platform for marketing. Restaurants can enhance their visibility through this platform. To promote their restaurant on the Foodpanda app, they can pay a particular amount.
Affiliate Income:
Foodpanda earns a huge sum of money from affiliates such as banks. Banks offer special discounts on Foodpanda deals to encourage transactions.
Expenses of Foodpanda:
Foodpanda is a global brand, and they have to spend a certain amount of money in order to streamline its operations. Here are some areas in which they spend money:
Maintenance and development
Salaries and provisions
Incentives for distributors and partners
Administrative expenses
Miscellaneous costs
Refunds and returns
SWOT Analysis of Foodpanda
Strengths of Foodpanda:
Popular Platform:
Foodpanda’s mobile app and website are really user-friendly. These platforms allow users to order food online without any trouble. Users can browse a diverse range of restaurants, deals, and offers. Also, they can track their orders on mobile app. and website.
Online Food Ordering:
The company receives orders through its mobile app and website. In this way, they connect thousands of users with restaurants.
Investment:
Some loyal investors play a huge role in the growth and success of Foodpanda. They are really confident about the company’s working and invest millions of dollars. They are the real strength of the company.
Fortified Brand Name:
The parent company of Foodpanda is really strong. The support from such a brand is an immense strength of the company. Several brands are working under the parent company, such as Delivery Club, Foodora, HelloFood, and many more.
International Presence:
Currently, Foodpanda has worked in various continents such as Asia, the Middle East, Latin America, and Eastern Europe.
Global Re-branding:
The company underwent re-branding in 2017 with its logo. They changed their logo from orange to pink. This initiative is considered its strength.
Fast Delivery:
There is no doubt that Foodpanda is a fast-food delivery service. They deliver food on time which helps them retain the customers.
Excellent Customer Support:
The customer support service of Foodpanda is really excellent. They always try to add new restaurants and offers. That’s why their customers always expect something different from them.
Weaknesses of Foodpanda:
Limited Ordering Zone:
The food ordering zone of Foodpanda is really limited. You can’t get access to those not available restaurants in your area. It is a big weakness of the company, and they should overcome it ASAP. Certainly, this restriction can harm the business in the future.
Increasing Delivery Charges:
Foodpanda is charging higher delivery charges that some people can’t afford. They can lose their customers just because of this reason.
Limited Coverage in Some Cities:
In some countries and cities, Foodpanda does not cover some areas fully. Therefore, they should think about it.
Opportunities for Foodpanda:
Growing Food Delivery Sector:
Foodpanda is operating in a segment that is already very crowded. But, this marketplace is growing day by day, which increases opportunities for the company. In short, there is a huge scope for the company in this segment.
Expansion of Customers:
The company should add new restaurants to its portfolio in order to target new users. This is the only opportunity to attract foodies.
Customer Loyalty Program:
Just to retain and attract new users, Foodpanda may build customer loyalty programs. Indeed, these programs help to provide discounts and offers to users.
Threats to Foodpanda:
Rising Competition:
The food industry has been growing very rapidly. There are various established companies and startups that offer online food delivery services. As a result, this marketplace is becoming more competitive with each passing day.
Varying Economic Conditions:
Factors like economic volatility and changes can crush the performance of Foodpanda. They should build some strong strategies in order to survive in such conditions.
Increasing Nearby Restaurant:
Sometimes people do not prefer to order food online but they prefer to go to a restaurant. The presence of nearby restaurants can put Foodpanda into big trouble. While considering its business model, It should keep this factor in mind.
Conclusion:
No doubt, Foodpanda is making a big impact on the online food delivery service. They are using social media platforms, offers, and discounts to get users’ attention. The company has achieved immense growth and popularity due to its business model and effective policies. They have the ability to create some big differences in the delivery and online food ordering segment. They must introduce some innovation in order to dominate the market.
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