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U.S. Food Delivery App Dash It has been launched in Japan, marking the company’s first foray into the Asian market and the latest move by a large express group to expand globally to take advantage of the pandemic-driven demand boom.
The US market leader, DoorDash, said that this move will allow it to enter one of the “most densely-populated countries in the world” despite its relatively small start-up.
Following its American strategy, DoorDash first focused on the suburbs outside the big cities. It said it had recruited “hundreds” of restaurants in Sendai, a city with a population of about 1 million north of Tokyo.
“This is a very underserved market,” CEO Tony Hsu said in an interview with the Financial Times on Tuesday, describing Sendai as a “miniature” of the entire country. “Across Japan, based on what we have seen, the most generous estimate is that 10% of merchants use the delivery method. So I think it’s too early.”
Japan’s restaurant culture means that people tend to stop for a meal on their way home rather than order takeout, but new entrants see opportunities in the growing population of retirees and dual-income families.
This move comes as major app delivery companies are actively expanding into new markets, betting that habits formed during the pandemic-related lockdown will become permanent.At the peak of the US lockdown measures, DoorDash’s revenue increased by more than 200%, prompting a sensational initial public offering Raised nearly US$3.4 billion for the company.
last month, British “Financial Times” report DoorDash is preparing to launch in Germany, another highly competitive market that will allow the company to compete with Just Eat Takeaway and Delivery Hero and Uber Eats. Tell the British “Financial Times” in April It is planned to be launched in Europe’s largest economy within “a few weeks.”
At the same time, through the acquisition of the unfinished Grubhub, Just Eat Takeaway will establish its first business in the United States, threatening DoorDash’s over 50% of the US market.
In Japan, DoorDash will meet familiar opponents, but also mature local players.
“It will definitely be very difficult,” Xu said. “When we talk about an investment like Japan, we are talking about a multi-year, ten-plus investment.”
Uber Eats was launched in the country in 2016, followed by Delivery Hero and China’s Didi Chuxing in 2020. Tokyo-based Demae-can has cooperated with nearly 60,000 merchants and has 5.82 million active users. It also provides a wider range of services such as mail order and dry cleaning.
DoorDash must also compete with a series of powerful local companies in neighboring markets, including grocery delivery cooperatives and Yamato and Sagawa package services.
Although DoorDash has begun to expand into convenience store merchandise in the United States, Xu said that he will not rush to take similar measures in Japan.
“It’s crawling, walking, and running,” he said. “We definitely don’t want to make any mistakes, just try to copy and paste what we see that may be effective in other regions. I think for us, we will have to build a very Japanese product.”
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