The FINANCIAL -- After five months of operations in Georgia, the online food-ordering portal ‘foodpanda’ is going viral on local market. Currently foodpanda is represented in Tbilisi, Mtskheta and Rustavi. With a strong financial backing from its holding company Rocket Internet, one of the world’s largest internet incubators based out of Germany, foodpanda is going to strengthen its marketing campaign and become the number one food delivery company not only in Georgia, but worldwide.
Foodpanda has recently got financing of around USD 60 million from a group of investors, including various existing investors, Falcon Edge Capital and Rocket Internet AG. Since its launch in 2012, foodpanda has raised over USD 100 Million. Recently, the company acquired its competitor Delivery Club, making it the leading food delivery marketplace in Russia and CIS region.
“There are 45 countries where foodpanda operates and the recently attracted USD 60 million will be spent on making foodpanda the most powerful online tool for food ordering in the universe and on strengthening its leading positions everywhere," said Giga Kerkadze, Director of foodpanda in Georgia. "Foodpanda was created to be the leader. For example, in Russia there was Delivery Club, which was a very big competitor of foodpanda’s. However, as it was difficult for foodpanda to share the leading position with the other company, it purchased Delivery Club and is now the top food delivery company in Russia,” he added.
Foodpanda was launched first in Singapore and had expanded into 16 countries by the end of 2012. This was followed by an expansion into seven more countries, to make a total of 23, by February 2013. The company stated that it aimed to move into 40 nations in Asia, Europe, Latin America, the Middle East and Africa by the end of Q1 2014 and it did achieve this. Nowadays, foodpanda operates in 45 countries, including Georgia, which it entered in March 2013.
The mobile application download numbers have gone viral in Georgia especially in the recent weeks due to some strong marketing activities done , highlighted Kerkadze who declined to disclose their monthly revenue and the number of orders received in a day. He however did say that their mobile app is doing very well as 40 percent of orders are received via it.
Foodpanda employs 10 people in Georgia so far. Foodpanda has online menus from a staggering selection of delivery restaurants. By visiting foodpanda’s website or its mobile application, customers can search for food by cuisine type, restaurant or even price range. The restaurant index also includes restaurant detailed info, their delivery hours and other delivery terms.
The process of ordering is simple: first of all, you open the website – www.foodpanda.ge – or launch the brand’s mobile application. Afterwards you select your city and district, which allows you to then select a restaurant and browse through their available food. Next is simple ordering and waiting for the delivery. What’s most important however, is that all prices on foodpanda are identical to partnered restaurant fees and hence the consumer does not end up paying an additional figure over the base price.
“Foodpanda always puts a focus on new markets, especially if it is an emerging market. Georgia was attractive for the company as well and we are happy to see that first results did confirm the attractiveness. Foodpanda is a growing company in every market and we all knew that, but it’s great to see that Georgia has picked really fast in the short period of time. Georgia was the 41st country out of 45 countries where foodpanda operates and during a period of just five months it has turned into one of the well performing and fastest growing countries of our big foodpanda family,” Kerkadze said.
“Foodpanda operates successfully in every country and this encouraged us to believe that it would be successful in Georgia as well. At the same time, we thought that Georgia was ready to create a preferable platform for internet business for its successful operation. We observed that the level of internet usage was high in Georgia and that more people were using mobile internet at the same time. And finally, we all know how Georgians appreciate good food and eating. Our business is exactly dependent on the following things - internet usage and demand for food ordering - this is the mix which drives the foodpanda model. In addition, what’s very important is to have big cities and many restaurants. Nowadays, foodpanda is represented in Tbilisi, Mtskheta and Rustavi. These might not be big cities compared to other cities in the 44 countries where foodpanda operates, but the three of them operate quite well as they do not lack for good restaurants. At present, foodpanda has more that 60 partner restaurants in Georgia,” he added.
Fast food is the most popular type of food among foodpanda’s customers followed by pizza, sushi and Georgian food. Out of the fast food menu, Pita is the most popular. In general, food which is cheaper is more in demand. On the other hand, sushi, which is an expensive type of food, is also very popular.
Foodpanda does not regulate the food delivery price. Every food establishment has their own prices. Also, the food delivery price varies depending on the place from where the customer orders the food. On average though, the food delivery price is GEL 3-5.
“We thought that lunchtime would be the busiest time in terms of number of orders. But we have found that suppertime is actually the busiest. This is due to people who do not know how to cook, are lazy about cooking, or are simply too tired after a hard day’s work and do not have the strength to cook. Therefore as a result of such reasons more people tend to order food via foodpanda for supper,” Kerkadze said.
Based on the “market place” model foodpanda creates preferable conditions for customers, restaurants and for itself.
“First of all let’s start with consumers. Foodpanda created a very convenient platform for them, where they can view a variety of different restaurants and foods and can select their preferred one. Also, they have information on not just the menu, but the prices as well. This means that they do not have to spend extra time searching for different restaurants on the internet, calling them, finding out about their menus and prices, etc. Now they can just visit foodpanda’s website or mobile app and get all the information they need at one glance. Thus they can save time. If the customers do not like the service, they can complain about it and if the restaurant does not improve the quality of the service, foodpanda stops cooperation with them. At the beginning of its operations in the country, foodpanda had more partner restaurants in Georgia than it does now, but as the quality of some of the restaurants did not match up to foodpanda’s standards, the cooperation failed,” Kerkadze said.
“Our benefit is that we cooperate with well known and most successful local restaurants based on mutually profitable conditions.For restaurants this cooperation is profitable as they get new clients and increase their order numbers. We give them such a technological platform which would be very expensive for them to create on their own. I refer to the online platform - web and mobile application, which are designed in our head office and are created in accordance with internationally high standards. The restaurants get more loyal customers as a result, because people have everyday contact with their food via foodpanda’s application. Accordingly, the number of the restaurants’ orders increases,” Kerkadze said.
foodpanda Georgia is a subsidiary of the German company Foodpanda GmbH. Its main offices are located in Berlin, where all other country branches are being coordinated from. The founder of foodpanda is the world’s leading internet incubator, Rocket Internet, which has over a 100 successful global online business ventures in its portfolio.