Low-cost, tourist segments power South-east Asia food delivery growth in 2024: report
Consultancy Momentum Works notes in its analysis that after years of prioritising profitability, the region’s top food delivery platforms have regained momentum to fuel their next phase of growth
FOOD delivery in South-east Asia rebounded in 2024 after two years of muted growth, indicated a report by consultancy Momentum Works.
The gross merchandise value (GMV) of food delivery in the region grew 13 per cent in 2024 to US$19.3 billion from US$17.1 billion in 2023. This surge came after two years of 5 per cent GMV growth between 2022 and 2023.
Vietnam and Indonesia led the growth. Food delivery GMV in Vietnam increased 26 per cent to US$1.8 billion in 2024 from US$1.4 billion in 2023. In Indonesia, GMV grew 18 per cent to US$5.4 billion in 2024 from US$4.6 billion in 2023.
In absolute terms, Thailand was the second-largest food delivery market in South-east Asia with a GMV of US$4.2 billion, followed by the Philippines at US$2.8 billion.
Grab continues to top food delivery GMV in the region with US$10.4 billion followed by foodpanda at US$2.7 billion. ShopeeFood, the food delivery arm of e-commerce platform Shopee, took third place with US$2.3 billion.
“After years of prioritising profitability, South-east Asia’s top food delivery platforms have regained momentum to fuel their next phase of growth,” said Li Jianggan, CEO and founder, Momentum Works.
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Food delivery players are now shifting from profitability to growth again, with strategies to tap into the broader mass market segment with strategies aimed at cost-sensitive segments. These strategies are meant to attract new users and boost purchase frequency among customers.
Grab has seen these strategies work in expanding its monthly transacting user base, growing from 38.5 million in Q1 2024 to 40.9 million in Q2 2024 and 41.9 million in Q3 2024.
Tourists are also another key segment that food delivery players are tapping into, with the number of visitors arriving in South-east Asia having grown from 39.8 million in 2022 to 91.4 million in 2023.
New players and consolidation
TikTok has started a pilot for local services in Indonesia and Thailand for users to purchase vouchers for food and beverage outlets and other services. The social media platform has allowed brands and local merchants to use the platform and its influencers to promote and sell the vouchers.
The difference between this new service and its e-commerce arm TikTok Shop is that users will have to physically redeem the vouchers they bought. Should TikTok decide to partner with delivery platforms for fulfilment, it could disrupt the market, Momentum Works noted.
Further consolidation of the food delivery market could also be on the cards, as the Grab-GoTo merger talks restart. Should the merger take place, it could reshape the Indonesia market, as food delivery players have ramped up their efforts in the second half of 2024.
Gojek, Grab and ShopeeFood rolled out more promotions, discounts and mass market initiatives throughout 2024. Both Gojek and ShopeeFood ramped up their promotion efforts in Q3 2024, while Grab increased its efforts in Q4 2024.
“After years of prioritising profitability, South-east Asia’s top food delivery platforms have regained momentum to fuel their next phase of growth.”
Li Jianggan, CEO and founder, Momentum Works
“With sharper customer segmentation and enhanced operational efficiency, they are now positioned to explore bolder, more strategic moves that drive sustainable expansion.” said Li.
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