South Korean media reported on January 14 that with the continuous expansion of the global catering takeout application market, the competition is becoming increasingly fierce. Some analysts believe that no more than two takeout companies in the United States can survive.
Grubhub, which has the largest market share in the US catering takeout market, is considering selling the company, South Korea's Central Daily website reported on January 10, citing the Wall Street Journal. It is reported that the company is consulting with M & An experts. After the news, Grubhub shares jumped 12.58% on the 8th to close at $54.75.
Grubhub, headquartered in Chicago, USA, was founded in 2004 and listed in New York in 2014. Although the company ranks first with a 34% share of the u.s. market in 2018, Uber Eats (24%) and DoorDash (12%), which rank second and third, have been clinging to it. As the industry becomes more competitive, Grubhub's market capitalization, which reached $13 billion a year ago, has shrunk by nearly 2/3 to $4.5 billion.
"although takeout apps have their own characteristics and different brand images, they offer roughly the same services, so they can only attract users through excessive competition such as discounts, advertising and marketing," the Wall Street Journal said.
"investors and analysts generally believe that the catering takeout industry only needs to keep two large companies, and other companies need to integrate through mergers and acquisitions," the report said.
If Grubhub finally decides to sell, Doordash, Postal partner Express (PostMates) and Uber Eats will all be strong competitors. The Wall Street Journal analysis said that for Doordash and PostMates, which are considering initial public offerings (IPO), the acquisition of Grubhub, a listed company, could help companies go public smoothly.
However, there is also a view that the US takeout application market has become saturated and has become the "Red Sea". Without large-scale market integration and restructuring, it is difficult to achieve rapid growth. E-commerce Amazon.Com Inc also launched the "Amazon.Com Inc Restaurant" app in 2015 to enter the takeout app market, but ended in failure and withdrew from the market last year.
According to the report, American takeout apps are seeking differentiation strategies by analyzing customers' ordering trends and providing special meals according to customer needs.
The annual catering report released by Grubhub shows that vegetarian takeout orders are increasing as the trend of well-intentioned consumption spreads. Last year, the most popular takeout food was broccoli pizza, so the company suggested restaurants to develop related food and beverage. Uber Eats also released the desire report, which found that orders for spicy food and beverage increase every Saturday, and plans to launch coupons as appropriate.