TITLE APPROVAL PAGE FOR GRADUATE THESIS
SUBMITTED IN PARTIAL FULFILLMENT OF REQUIREMENT FOR DEGREE OF MASTER OF BUSINESS ADMINISTRATION AT LINCOLN UNIVERSITY, OAKLAND, CALIFORNIA
CANDIDATE: Thao P Nguyen
FIELD OF CONCENTRATION: Business
THESIS TITLE: Market potential of online food ordering services: The case of Ho Chi
Minh City, Vietnam
Ihave read and approved this thesis for presentation
APPROVED BY: Dr Alexander Anokhin
Trang 3Abstract
As more and more people spend most of their time on studying and working, there is
demand for food delivery services Nowadays, many restaurants make use of Internet
in order to allow their consumers to place orders online via multi-restaurant websites However, this new type of service have just been introduced to serve Vietnamese people The purpose of this research was to find out current eating habits of the
Vietnamese people, demand for online ordering services, and factors affecting their use of this service so that market potential of online food ordering service can be
investigated In order to accomplish this study, we collected data by sending the link of
questionnaire forms electronically to 255 persons to young people who are currently
living in Ho Chi Minh city, Vietnam The findings of this study revealed that although there are a modest percentage of respondents using this service offered by multi- restaurant websites, a large majority of them ordering food delivery services are
Trang 4Summary
While many people.insist on preparing meals for family in order to enjoy
nutritious food, others don’t want to spend too much time on cooking rather than other
jobs Those people sometimes don’t want to enjoy food at restaurants because they are too busy to go out for food Thus, online ordering food services will meet demand of these people It is really easy and convenient to order delivered food to their places through multi-restaurant websites Actually, Internet plays a significant role in offering this service to customers These websites provides customers with a wide range of
different restaurants with different type of cuisine, and their menus with photos and prices are always available for them choose by clicking on the selected items After carefully considerations, customers can choose preferred methods of payment and wait for delivered food within their estimated time This service was first launched to serve expats who have hassle in talking with local restaurants about their orders Then, some Vietnamese people started to experience this new type of service; however, not many of the Vietnamese know its existence Therefore, this research was conducted to find out market potential of online food ordering services in Ho Chi Minh city, Vietnam The questionnaire was designed in order to investigate current eating habits of
Vietnamese people, demand for online food delivery services through multi-restaurant websites, and factors leading to users and non-users of this service, and the link of this questionnaire form was sent electronically to 255 young respondents living in Ho Chi
Minh city The findings showed that although nearly a quarter of total respondents was
users of multi-restaurant websites for ordering food online, a large number of respondents having demand for food delivery services possible became potential customers for this service Besides, a significantly large proportion of them reported to
intend to experience this service, and most of them were non-users Current users of multi-restaurant websites revealed that they often ordered food delivery for lunch, tea
Trang 5payment, which was chosen by almost all of users of this service, and most of them would like to receive delivered food within 40 minutes Additionally, non-users of this
service stated that most of them did not order delivered food from multi-restaurant websites because of quality of delivered food, unawareness of existence of this service, and higher prices Most of users agreed that great convenience and the ability of
control were decisive factors making them use multi-restaurant websites Nevertheless, they also stated that there were some drawbacks of online food ordering services leading to unsatisfied customers and possibly non-users A large percentage of users
chose ineffective delivery process, quality of delivered food, and high minimum delivery fees The results of this study are of extremely important for multi-restaurant websites to know its potential growth in Ho Chi Minh market Therefore, it is highly
recommended that the convenience of online food ordering services through multi- restaurant websites should be widely known by many more potential customers
Besides, effective solutions regarding enhancing services of ordering delivered food
Trang 6Acknowledgements
I would like to express my deep gratitude to my advisor, Dr Alexander Anokhin who
provide me with careful and helpful guidance on my MBA thesis Moreover, he helped to lead me to the right direction when I was confused about thesis topic at the
beginning I also would like to thank you for giving me encouraging advice during the time of conducting this research
Moreover, I am immensely grateful to my parents for their all metal and financial support so that I can accomplish this MBA course I also want to thank voluntary respondents who are willing to complete my questionnaire and help to send it to other suitable respondents without expecting anything in return Furthermore, my close friend, Ms Ngoc Dang Bui shared her experience on the service regarding my thesis topic
Last but not least, I am sincerely thankful to my best friend, Ms Vy Thanh Ho who is
Trang 7Table of Contents ADSITACE HH HH HH KH HH HH1 H1101114111121111 010 3 kia Số 4 Acknowledgement .cssccsssssscsssssessssssssssssesesesessscssssssssesesssnansacseasasesevsueseacseseeeecesess 6 (0 )0:2018/0(.30.:(00I0 00000888 e AẦ 8 Chapter 2: Literature R€@Vi€W LH LH Hà HH HH HH HH HH ec 12
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Trang 8Demand for food delIVeTY S€TVICGS HH1 c1 errrre 37
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Trang 9Chapter One: Introduction
Internet has brought about great convenience for its users in many fields especially food and beverage industry, and it makes our lives easier and more
comfortable than it used to be In recent times, most of people are busy with their duties and work; therefore, they do not have enough time to prepare for family parties on some special occasions or even their daily meals Traditionally, foods are ordered at the restaurants directly, and customers have to wait for their food to enjoy them or to take them home Sometimes, they can order their dishes by calling the restaurants Then, they will come to receive their food or those dishes are delivered to their preferred locations However, some unexpected situations may occur at ordering process such as mishearing the names of offered dishes, misunderstanding customers’ demands, taking wrong orders At that time, online food ordering services are of great importance for customers to deal with these problems Customers simply access to a multi-restaurant website which connects a wide range of food providers in order to
choose dishes for their meals Every restaurant reveals their menus with photos of all dishes so that customers can select their food more easily Moreover, it is customers
who directly place their own orders, and they can have more chances to experience different types of cuisines offered by multi-restaurant sites simultaneously After that, customers can have food delivered to their doors Especially, they are free to select
payment methods suitable for themselves because it offers many payment methods
Actually, ordering food online is known as a part of e-commerce services aiming to
provide customers with ease of use, quickness and convenience Moreover, customers
will spend their time fulfilling other duties more efficiently
Food and beverage industry is considered one of most well-known industries
serving millions of customers everyday, so it generates a great deal of revenue from its
services Furthermore, customers’ demands have been varied day by day, and service
Trang 10expectation Therefore, online food ordering service is a new type of serving
demanding customers who are too busy to prepare home-cooked foods Besides, customers can place their orders whenever they want without being afraid of letting
others waiting for their decisions This great convenience offered by this service is really interesting to investigate in this research
The advent of online food ordering services initially emphasized to serve
foreigners living and working in Vietnam They may face difficulties in
communicating with local people to order Vietnamese food, and it is inevitable that
misunderstanding between them would occur Thus, this service gives contribution to
make international guests more comfortable to enjoy food at their accommodations if
they cannot come to local restaurants Gradually, other multi-restaurant sites have been
introduced to serve Vietnamese guests However, not many food lovers are familiar
with this new kind of service because they have not acknowledged considerable benefits of ordering food online through multi-restaurant sites
This study is really significant in the term that it aims to provide potential customers with information about online food ordering services so that they can try experiencing the convenience and benefits from this service Furthermore, knowing customers’ demands will be valuable for multi-restaurant site owners to improve their
services so as to attract many more frequent users
The aims of this paper are to find out current eating out habits of the
- Vietnamese, to determine their demands from online food ordering service, and to
investigate what factors affect customers’ decisions on using this new type of service This research mainly focuses on ordering food online through multi-restaurant sites serving the Vietnamese in Ho Chi Minh city, Vietnam
In order to acknowledge market potential of food delivery service through
multi-restaurant websites, we attempt to answer three research questions:
Trang 112 What do Vietnamese customers demand from online food ordering services?
Trang 12Chapter 2: Literature Review
Influence of Internet and technology on restaurant industry
Tomkies (2010, pp 34-35) states that food services industry is believed to be
related to waiting for long hours; however, technology will give contributions to the improvement of restaurant operations in the future Moreover, technology also has a
great influence on not only how customers relationships are managed but how customers’ food can be ordered and received as well Furthermore, Internet is also
known to play increasingly significant role in restaurant industry in term of online ordering service, and Japa John’s is an example of one of the first companies applying
this service to its business model (Tomkies, 2010, p 37)
In addition, Internet is also used to “manage customer relationships” To be
more specific, when customers sign up to order food online, companies can get customers information in order to conduct surveys and send email newsletters and offers, which makes customers connected to restaurants (Rothenberg, as cited in
Tomkies, 2010, p 37)
Vardy (2012) states that advances of technology have great impact in the food
and restaurant industry, and it is believed to serve the industry and patrons for experience improvement For restaurant patrons, they can easily find appropriate
restaurants, rate them, and choose suitable locations and time for their meals thanks to
technology Besides, restaurant owners also take advantage of technology to manage
their business effectively and efficiently through hardware and software for food and
restaurant industry
Impact of technology in the food and restaurant industry also results in the
improvement of “customers” dining experience” and efficiency of restaurant
Trang 13There are a number of recent innovations in technology applied in the restaurant industry in order to enhance customer service such as mobile ordering, iPad order
kiosks, Facebook ordering, tabletop e-waiter and checkout, digital menu boards, games
while-u-wait, and online coupons (Tice, 2012) Online food ordering services
From Wikipedia, the free encyclopedia shows a detailed definition of online food ordering:
Online food ordering is an internet e-commerce service with websites that feature interactive menus, ratings and reviews allowing customers to place
orders with local restaurants and food cooperatives Much like ordering
consumer goods online, many of these allow customers to keep accounts with them in order to make frequent ordering convenient A customer will search for
a favorite restaurant, usually filtered via type of cuisine and choose from
available items, and choose delivery or pick-up Payment can be amongst others either by credit card or cash, with the restaurant returning a percentage to the online food company (“Online food ordering”, n d.)
Goel (2007, p 1) mentions electronic commerce or e-commerce as “the buying and selling of goods through human-computer interaction over the Internet” Moreover, e-commerce is also defined as “modern business methodology” aiming to serve
consumers as well as organizations so that they use Internet as a tool for cutting cost, making improvement in the quality of goods and services, and making delivery service faster
Online food ordering services follow the simple business model Actually, multi-restaurant sites work as intermediaries between restaurant partners and
consumers The users search for restaurants, order food from selected restaurants, and choose appropriate payment methods like online payment or cash on delivery (Bisht,
Trang 14Nowadays, many restaurants especially “product-oriented businesses” seem to maintain “physical and online presences” with an attempt to attract more customers to
pay a visit to their locations and make purchases (Aspray, Royer, & Ocepek, 2013, pp
6-7)
Khan (2015, p 519) points out that customers prefer using Internet for online ordering thanks to its advantages, and it is much more convenient to order via Internet than calling by phone Customers also are more comfortable to order online when they
stay at work or at home He also states the reasons why customers choose to place their
order over the Internet such as “time savings, price savings, speed of service, ease of
menu selections, and of course security of information” (Khan, 2015)
Hausman (2012, pp 269-296) also demonstrates that it is more common for customers to order pizza online so that they can avoid to cope with hassle regarding
phone ordering, and using online ordering will “reduce miscommunication” and
increase customization Additionally, online ordering service is often used for popular restaurants which usually let customers wait long
Restaurants offering online food ordering services will gain competitive
advantage over others, and this type of service also maintain customer loyalty Actually, it is generally believed that customers requiring convenience are ready to spend money on “quality food” as long as quick service is offered (“Offering online ordering”, 2014)
Furthermore, online ordering offers benefits for not only customer but also
restaurants, and it actually creates win-win situations for them While restaurants offering online ordering service increase their sales, customers are also happy to enjoy their food without wasting time on waiting in line This type of service helps to ensure accuracy of customers’ orders and eliminate some errors arising from
misunderstanding during ordering process because it is customers who place their
Trang 15Ordering food online also allows customers to compare prices of different restaurants offer on multi-restaurant websites, and they will know exactly how much they are going to pay for their food (Nedelcu, 2013)
Besides, customers placing their order online can “overcome the language
barrier in telephone communications where there may be errors in taking small details”
(“Ordering food online”, 2014)
Maity (2013) points out that one of top-most categories of consumers using online food ordering services are aged from 18 to 24
Online food ordering services in other countries
Nedelcu (2013) shows some well-known online food ordering services in other
countries There are a number of popular businesses allowing customers to order food
online in the United State of America such as Orderlunch, GimmeGrub, GetQuik,
Diningin, Delivery, Foodler, and especially GrubHub Besides, Meal2Go and
HungryHouse offer the same service in the United Kingdom Furthermore, Menulog
and Eatnow aim to serve Australian customers for placing their orders Nedelcu also give information about other providers operating in a wide range of different countries
like JustEat, FoodPanda, and Delivery Hero
JustEat ple (incorporated in the UK) is regarded as one of the globally leading
online ordering service, and it serves in around 13 countries around the world such as the United Kingdom, Belgium, Switzerland, Sweden, Spain, Norway, the Netherlands, Italy, Ireland, Denmark, France, Brazil, and Canada JustEat has worked with over 40,000 takeaway restaurants in order to “offer an efficient on-line ordering service” (JustEat plc, n d.)
Trang 16many European countries like the United Kingdom, Germany, Britain, Belgium, Austria, France, Switzerland and Denmark (Takeaway.com BV, n d.)
Established in 2004, GrubHub Inc is known as one of the “leading online and
mobile food ordering” companies connecting “hungry diners with local takeout
restaurants” Moreover, it allows customers to place order from around “30,000 takeout restaurants in more than 800 U.S cities and London GrubHub also manages four brands including GrubHub, Seamless, MenuPages, and Allmenus, and its offices are currently located in Chicago, New York and London (GrubHub Inc., n d.)
It is stated that Seamless, a food delivery and takeout service provider, was “launched in 1999” It has partnerships with “over 12,000 restaurants” and “have over
2 million members in the United State and London Moreover, it offers personal orders
in many famous cities in the USA such as New York, Boston, Philadelphia,
Washington DC, Miami, Chicago, Houston, Seattle, San Francisco and Los Angeles (“Seamless”, n d., para 2)
It was announced that Seamless North America LLC and GrubHub Inc
completed their merger After this important event, they are known as GrubHub Seamless to “support both the GrubHub and Seamless brands” (GrubHub Inc., 2013)
Grobart (2013) states that GrubHub and Seamless not only offer online ordering service but also allow customers to writing reviews about restaurants, which plays important role in keeping customers coming back to use this service
A survey conducted by Zagat reveals the fact that “a whopping 58 percent of meals eaten by New Yorkers in 2013 were from restaurants and takeout” Moreover, a great deal of people get addicted to food delivery service because “it is quick and does not conflict with their busy work schedule” Therefore, some people confess that they
Trang 17Founded in 2011, Delivery Hero is considered as “the biggest food network in the world with more than 200,000 participating restaurants” It aims to provide their customers with key benefits including choice, convenience, reliability and quality
(Delivery Hero Holding GMBH, n d.)
Some have noted that the headquarter of Delivery Hero is located in Berlin, Germany This online food ordering service provider operates in many countries such
as United Kingdom, Finland, Poland, Switzerland, Germany, Austria, Denmark, Mexico, Australia, India, Korea, Latin America, and China (“Delivery hero”, n d.)
FoodPanda was established in 2012 with its headquarter in Berlin, Germany It
33 cc
is well-known as “a global food ordering marketplace” “operating in more than 40
countries across five continents” Its services are available in “more than 500 cities
around the world, and its partners are around “more than 30,000 restaurants globally” FoodPanda consists of three brands such as Hellofood in Latin America, Middle East and Africa, Foodpanda in Asia and Eastern Europe, and Delivery Club in Russia (“About FoodPanda”, n d.)
Saudi Arabia is considered as “the largest market for Hellofood with more than
450 restaurants”, and it is very common to order food delivery online through mobile phones in this country According to Beschir Hussein, a chief executive officer of
Hellofood in the Middle East, the reasons why Saudis choose online food ordering
services are “convenience and fast delivery services” (Estimo, 2014)
In addition, CEO of Hellofood in the Middle East, Hussein emphasizes that they attempt to provide their customers with “convenient, fast and fun order experience” by developing “a customer-friendly mobile application” Moreover, customers can read information about recommended restaurant rated by other users, and it also allows
them to “access their order history for fast and convenient re-orders” Besides, Hellofood will offer “innovative food ordering solutions for companies and other
Trang 18seasonality and fluctuation”, some hotel owners do not offer their guests room service in order to “avoid high fixed costs” (Nihal, 2014)
Cunningham (2013) reveals that FoodPanda still competes in the restaurant delivery wars After controlling in Latin America, eastern and western Europe
successfully, FoodPanda operates in Southeast Asian countries such as Malaysia,
Philippines, Singapore, Thailand and Vietnam in mid-2012 It also has to cope with challenges related to “persuading customers to try out the service”, “finding and
training reliable motorcycle delivery guys”, “getting feedback on performance” so as to run meal-delivery business successfully
Having partnership with WeChat across Southeast Asia, FoodPanda allows their
customers to place their orders via WeChat by doing the same steps as in FoodPanda’s website or app This great benefit is applied for users in seven markets such as Hong
Kong, Thailand, Singapore, Malaysia, Taiwan, Philippines, and India (Estopace, 2014) According to Technomic’s study in 2010, it was shown that 43 percent of 1000 adults attending this study had ordered online with computer Moreover, “younger consumers were more likely to have used electronic ordering”, and around 54.1 percent of respondents revealed that it was easier and more precise to use electronic ordering than to talk with a live person (as cited in Kimes & Laqué, 2011)
Kimes (201 1a) indicates that it is popular for US residents using the Internet to apply online, mobile and text ordering Both users and non-users of online ordering services agree that “perceived control and perceived convenience” are two important factors affecting their decisions to choose this service For those who do not place their
order online have “a significantly higher need for interpersonal interaction and higher
technology anxiety” than people using online ordering service
Trang 19payment and delivery method, and know their accurate orders are extremely essential to increase their perceived control on using this service Making online ordering system easy to use will help to improve customers’ perceived convenience (Kimes, 201 1b)
It is also suggested that these online ordering websites should offer step-by-step guidelines so that consumers can place their orders more precisely and conveniently
Moreover, it is advisable to allow users to save their favorite orders in order to repeat them by clicking on a button Customers’ perceived convenience can be enhanced by
having their address and preferred payment methods saved, and they do not have to give same information every time they want to place their order via multi-restaurant sites (Kimes, 201 1a)
Online food ordering services in Vietnam
According to a 2012 study conducted by Ogilvy & Mather Asia-Pacific, a
corporation specializing in Marketing and Advertising, Vietnam is considered as a potential market for investing in food and beverage industry because Vietnam has a
large population and its residents are quite familiar with prepared food (Ha, 2012) Do (2013) revealed general information associated with top food delivery sites in Vietnam such as Vietnammm, Eat.vn, Hungrypanda Two sites like Vietnammm and Eat.vn focus to serve expats living in big cities in Vietnam like Hanoi, Danang, Ho Chi
Minh, while HungryPanda considers Vietnamese customers as its main concentration
Cao (2014) points out that Vietnammm.com is one of the biggest online
ordering sites in Vietnam, and it offers not only international cuisine but also
Vietnamese food for customers With simple steps, customers can order their preferred food and have them delivered at home Moreover, it allows customers to rate and review the restaurants so that others can know more about their service Especially,
Vietnammm.com considers delivery as the most crucial factor contributing to the
Trang 20It was officially announced that takeaway.com, one of “the largest food delivery websites in the world” acquired Vietnammm.com, “Vietnam’s largest food delivery website” This acquisition provides great benefits for Vietnammm.com because Takeway.com allow “the Vietnamese site to take advantage of its iPhone, Android, Windows 8 and Windows Phone apps” Furthermore, with the attempt to scale up the business, local marketing and personnel will be invested by Takeway.com
(“Takeaway.com expands to Asia”, 2013)
CEO of Vietnammm.com, Ms Nguyen Thi Hong Hanh emphasized that
although their major customers are foreigners living in Vietnam, the number of
Vietnamese ordering online through its service account for 40% of total customers
Actually, many more Vietnamese prefer using this service especially residents in Ho
Chi Minh city (“Đặt thức ăn”, 2014)
It is shown that Vietnammm.com concentrates on providing their consumers
with great customer service, and its customer service team is always ready to support their consumers and restaurant partners to deal with problems at any time Besides,
Vietnammm.com also launched apps on IOS and Android at the beginning of 2014,
which enhances convenience for customers Additionally, Vietnammm.com sets up GPRS printers in their restaurant partners so that orders will be received and processed more conveniently and precisely (“Vietnammm.com”, 2014)
Supported by Rocket Internet, one of the most well-known internet startup
incubator in the world, FoodPanda was known under the name of HungryPanda in
Vietnam However, the problem regarding using the name of FoodPanda was solved so
that it can operate under official name of FoodPanda in Vietnam Actually, before doing business in Vietnam, FoodPanda was widely popular for online food ordering service in some Southeast Asian countries such as Thailand, Malaysia, Indonesia,
Philippines, and Singapore Moreover, it also has experience in developing products,
Trang 21advantages of FoodPanda contributes to make it competitive in this industry (Le,
2012)
FoodPanda’s online food delivery website was officially established on March 26, 2012 in Vietnam It is currently holding a leading position in five major cities in Vietnam such as Hanoi, Ho Chi Minh, Can Tho, Da Nang and Nha Trang FoodPanda
aims to offer “a level of service that’s unrivaled”, and it takes pride in supplying its customers with “the widest selection of the best restaurant’s to choose from at
affordable prices and in the fastest possible delivery time” (“FoodPanda launches online food delivery”, 2012)
Auchard (2014) revealed that FoodPanda received $60 million in new financing from a group of investor including Rocket Internet AG According to Ralf Wenzel, a co-founder and chief executive of FoodPanda, this funding will assist FoodPanda to
“deepen penetration of its existing Asian, African, Eastern European, Middle Eastern and Latin American markets”
It was announced that Burger King, a large fast food restaurant chain and FoodPanda Vietnam, a well-known online food ordering firm created strategic and exclusive partnership This collaboration allows customers to order from Burger King’s menus directly through FoodPanda’s website or its apps on smart phones (Le, 2014)
Duong (2014) stated that FoodPanda Vietnam won the award of the leading
product and service in Vietnam in 2014 rated by consumers Moreover, FoodPanda has
worked with many globally well-known brands like Burger King, Jollibee, KFC, Pizza Hut so that it provides diversified cuisine from many cultures for gastronomy lovers in Vietnam
Trang 22FoodPanda to order food Then, many more customers will be familiar with the service
and convenience offered by FoodPanda (Dinh, 2014)
Chonmon.vn is one of e-commerce products supported by Vietnam
Communications Corporation which is known as VC Corp, a leading corporation in
Internet industry Chonmon.vn was launched in September, 2012, and it serves
residents living in two biggest cities which are Hanoi and Ho Chi Minh City Besides, Eat.vn, a well-known website for offering online ordering service for expats in
Vietnam, was acquired by VC Corp in August, 2012 Especially, it emphasizes its
advantage of excellent customer service over other competitors in this industry The world’s largest restaurant chain in term of units, Subway established partnership with Chonmon.vn backed by VC Corp to provide customers with ordering service (Thanh,
2012)
Most of online food ordering sites attempt to establish a large database of restaurants, to offer great convenience, and to allow customers to place orders online through websites and apps on smartphones However, maintaining customers loyalty depends on how these service providers control the food quality and delivery process
(Tran, n d., para 10)
Tran (n d., para 12) showed that almost all of online ordering service providers prepared their own delivery team, and some of restaurant partners owned delivery
system to have food delivered to customers directly These service providers also
attempted to shorten delivery time to within 30 minutes; however, they sometimes
could not control delivery time if their restaurant partners were responsible for this process
Le (2012) also emphasized that delivery process should be considered as a critical factor in e-commerce service, especially in online food ordering service However, payment is not a serious problem in this service because food delivery men
Trang 23popular, and Vietnamese people are also familiar with paying in cash In reality, all of
online food ordering sites in Vietnam apply this method
According a research conducted by FoodPanda, a leading food delivery firm,
nearly two thirds of Vietnamese’s orders were placed online at weekends, and selected items were normally traditional food or pizza However, former CEO of FoodPanda stated that 55% of orders were placed through FoodPanda on weekdays, and 45% of
them occurred at weekends It was demonstrated that 45% of total orders per week were placed during the period of 11am to 2pm Actually, customers don’t spend time on
preparing food at home and going out for lunch, so they choose to order food and get
them delivered to their office Moreover, customers ordering food from 4pm to 6pm
and from 8pm to 10pm accounted for 35% and 13% of total orders respectively Most
of the Vietnamese usually skip breakfast or they love to cook breakfast at home; therefore, the number of orders placed from 10 am to 12am was only 7% Moreover, former CEO of FoodPanda, Mr Don Phan also concluded that Vietnamese customers had a tendency to order food that looks appealing rather than healthy food (“Ngudi
Việt chuộng đặt thức ăn trực tuyến”, 2013)
Yen (2015) points out that food delivery is really helpful for those who are too busy to prepare their own meals Some students who are doing their assignment and
studying for their exams may prefer food delivery service Especially, workaholics will
also be happy with this service These people usually do not want to go out for their meals and cook for their meals , so ordering food online will satisfy their needs Many
more restaurants offer food delivery at night especially from 11pm to 3 am because they acknowledge the increasing demand for food delivery in a busy city like Ho Chi
Minh city Actually, CEO of Vietnammm.com, Ms Nguyen Thi Hong Hanh stated that
there were some restaurants registering to offer 24h service for customers when they
Trang 24CEO of FoodPanda Vietnam, Tauriq Brown reveals that there are some factors
making Vietnamese customers reluctant to use online ordering service They are afraid
of the actual taste of food compared with what was advertised Moreover, the price of delivered food seem higher than that of the food served at the restaurants They are also worried that their personal information will be disclosed, and complicated procedure of ordering food online and ineffective delivery are considered as problems In fact, ordering food online is extremely popular in most of Western countries, whereas many Vietnamese people are not accustomed to using this service Thus, effective solutions should be offered to deal with these challenges and change Vietnamese consumers’
Trang 25Chapter three: Methodology Participants
This research aims to investigate market potential of online food ordering services in Ho Chi Minh city The participant of this research will include young
people who are currently living in Ho Chi Minh city, and they could be considered current and potential consumers of this service It is acknowledged that the
participation in this research is completely voluntary Most of participants are college students and employees who are willing to give their opinions and answer the designed
questionnaire There are totally 255 respondents attending in this questionnaire
Materials
Questionnaire was designed to examine attitudes of Vietnamese young persons towards online food ordering services in Ho Chi Minh city This questionnaire is
divided into four sections, and it includes 33 questions The first part will cover respondent’s background information like gender and occupation The second part consists of 11 questions about Vietnamese eating habits for main meals such as
breakfast, lunch, dinner and tea breaks They are asked about types of foods that they often choose to have for their meals and the places they enjoy the food The third part
of the questionnaire includes 15 questions aiming to investigate Vietnamese demand
for this service by getting to know their demand for food delivery service in general
Then, there are asked about popularization of this service and what they expect from this service Finally, the fourth part of questionnaire covers 5 questions about factors
affecting customers’ decision on using this service For users of this service, respondents are asked about advantages and disadvantages of ordering food online through multi-restaurant websites Besides, non-users also give reasons for not choosing this service Some respondents will skip questions based on their answers,
Trang 26This questionnaire was conducted by google forms, and the link was sent to various respondents electronically When delivering the questionnaire forms to
respondents, I also explained the main purpose of this research so that they are willing
to express their opinions Thus, some participants recommend other participants who
agree to respond to questions concerning this service Moreover, other respondents are
so supportive and enthusiastic that they help to send links to their classmates or
colleagues to fill in the form After that, we also send them sincere thanks for their cooperation and assistance if they complete the questionnaire Then, Google form helped to collect information from respondents However, Microsoft Excel was used
Trang 27Chapter four: Results Collection of findings
Demographic description of respondents
The total number of respondents participating in this research was 255 persons
Almost two-thirds of respondents( 65%) who are willing to spend time on completing
the questionnaire are female, and one-third or 35% of participants are male (Exhibit
4.1)
In term of the occupations, nearly haft of respondents (49.8%) are currently working as employees, and more than two-fifths (43.5%) of them are studying at
colleges or universities in Ho Chi Minh city Moreover, only around one in twenty
(5.1%) are business owners Besides, a very small number (1.6%) of respondents are currently unemployed and working as housewives (Exhibit 4.2)
Eating habits of respondents
When respondents were asked about where they often enjoy their meals, a large
majority of them choose their homes as preferred locations Moreover, the second most
frequent place for meals was outside locations like restaurants, street food shops, food courts In fact, 38 percent of respondents enjoy their breakfast at home, and having
breakfast outside was chosen by 33% Other persons eating breakfast at their
workplaces and schools accounted for 28% and 26% respectively Besides, a very small number of them chose the other option because they are not familiar with having
breakfast in the mornings For lunch, a significant number of participants (43%) having
their meals at home is 2% higher than that of those who wish to enjoy at workplace While about a fifth of responses (20%) reported that they prefer outside locations like restaurants for lunch, 16% of them choose schools It is noticeable that just over three
quarters of total participants (78%) would like to enjoy dinner at their homes, whereas
Trang 28The workplace and school were chosen to have dinner by 4% and 1% of respondents respectively (Exhibit 4.3)
When being asked about what type of food respondents would like to eat for their meais, home-made food was chosen by a large number of persons attending this
questionnaire Take-away food comes second, and there is a very small minority of participants choose other type of food which was made and served at their workplace, at restaurants, milk tea shops and coffee shops For dinner, it is interesting that just over four-fifths of all respondents (82%) prefer home-made food Besides, take-away and delivered food selected for dinner contribute to 15% and 10% of surveyed subjects It is also the situation like dinner because home-made food for lunch was chosen by nearly two-thirds of them (64%) However, delivered food becoming their second choice for lunch represents a quarter of respondents (25%), and about a fifth of them
would like to have take-away food for lunch Furthermore, take-away food is
considered favorite option for respondents who want to choose for their breakfast and tea breaks, which make up 66% and 63% respectively Home-made food as the second option for breakfast accounts for 33% of respondents, whereas nearly a quarter of them
(24%) prefer delivered food to their locations as their second most frequent choice for tea breaks (Exhibit 4.4)
As collected from responses, the most favorite food chosen for main meals was
Vietnamese rice In fact, a significantly large majority of respondents would like to eat
Vietnamese rice for lunch and dinner, which make up for 92% and 83% respectively,
while approximately three-fifths of them (58%) prefer fast food for breakfast It is also very interesting to see that noodle was considered as the second most preferred food
for three major meals like breakfast, lunch and dinner (Exhibit 4.5)
Trang 29participants Besides, the figure for the number of respondents choosing sweet cakes
and sweet soups was at 16% and 6% A small minority of respondents (1%) stated that
they don’t enjoy tea breaks (Exhibit 4.6)
Demand for food delivery service in general
A significant proportion of all respondents (69%) reported that they use food
delivery service, and the rest of them said they don’t want to use this service (31%)
(Exhibit 4.7a) It is interesting to figure out the fact that the rate of male customers
preferring food delivery is slightly higher than that of female ones To be more
specific, the figure of female respondents having food delivered to their locations make
up 67 percent, whereas nearly three quarters of male participants (73%) use food delivery service (Exhibit 4.7b) In term of respondents’ occupations, two-fifths of respondents (40%) choosing food delivery service are currently employees, and students who get food delivered to their locations contributes to nearly a quarter of total respondents (23%) It is noticeable that employees using food delivery service represents forth-fifths of total employees Especially, it is similar for business owners,
and almost all of them use food delivery service For students, more than half of them
reported to receive delivered food (Exhibit 4.7c)
A significant percentage (61%) of all users said that they use food delivery services when they don’t have time to cook for themselves Besides, the occasion of having parties with friends or families was chosen by approximately three-fifths (59%) of users There is a small number of them (31%) ordering food delivery service for their business, whereas only 4 percent reported to receive this service because they are
too lazy to go out for food and sometimes they want to enjoy different taste from this
service (Exhibit 4.8)
The question of what food users often order to be delivered to their locations was used to ask for responses Fast food was chosen to be delivered by over fourth-
Trang 30considered to be the second most frequent ordered food for delivery accounted for 67
percent of all users The figures for users who order delivered food like sweet cakes, rice and noodle soups represents 24%, 23% and 22% respectively There are small percentages of users choosing other foods such as ice-cream, dried dishes and sweet soups (Exhibit 4.9)
Almost all of food delivery users (91%) often order their food by making phone calls to providers, while just over two-fifths of them (41%) order food delivery online
Additionally, a small minority (18%) of users meet food providers directly so as to
have their food delivered (Exhibit 4.10)
Demand for online food delivery services
Among total of food delivery users, there are two-thirds of them (65%) ordering this service online The remaining of them (35%) don’t order delivered food online (Exhibit 4.1 1a)
In addition, in term of occupations, nearly two-fifths (38%) of users stated to order their food delivery online, and students coming to second make up 23% of total
users Amazingly, the percent of users nearly double that of non-users in almost all of listed occupations except other occupations (Exhibit 4.11b)
There are many channels allowing consumers to order food delivery services online such as Facebook, restaurant websites, multi-restaurant websites, mobile apps and other channels Nearly seven-in-ten online users (67%) reported that they often order their food delivery at restaurant websites, while just over half of them (51%) choose Facebook as their preferred channel It is also stated that the figure of customers ordering delivered food by multi-restaurant websites was at 32 percent, which was 35%
lower than that of restaurant website users Besides, there is a small number of them choosing mobile apps for ordering this service, and only 2% said to order via other
Trang 31Popularization of online food ordering services via multi-restaurant websites
When respondents were asked if they know online food ordering services via
multi-restaurant websites, just over three-fifths of total respondents (60.4%) said yes
The remaining 39.6 percent of them don’t know this service (Exhibit 4.13a) Although
the number of female participants outnumbers that of male ones, the rate of male respondents knowing this service is slightly higher than that of female ones To illustrate, a large percentage of total male respondents (63%) reported to be familiar
with multi-restaurant websites, whereas nearly three-fifths of all female participants (59%) know food delivery via multi-restaurant websites (Exhibit 4.13b) Furthermore,
it can be seen that 34.1 percent of total participants knowing services offered by multi-
restaurant websites are employees, which more than double the percent of remaining
employees (15.7%) Students who are knowledgeable about this service make up 23.5%, which is slightly higher than the percent of the left students (20%) Besides, a
small number of total participants knowing online food ordering services via multi- restaurant websites are business owners (2.0%) and other (0.8%) (Exhibit 4.13c)
There are many different information channels making multi-restaurant websites more popular In fact, as can be seen from the chart that Internet is the most popular
channel introducing multi-restaurant websites to a significant percentage of total
people knowing this service (87%) More than half of them (52%) reported that they
are familiar with services provided by multi-restaurant websites thanks to their friends
Trang 32Specific number of respondents have answered what multi-restaurant websites
they know or they use It is clearly shown that foodpanda.vn is the most popular
website for online food ordering service Actually, nearly half of total respondents (48%) who are familiar with this type of service are aware of foodpanda.vn, and 16 percent of them ordered delivered food through foodpanda.vn Two websites, Eat.vn
and Vietnammm.com were known by the same percentage of total participants (17%),
while chonmon.vn was familiar to less than a fifth of them (15%) Moreover,
chonmon.vn, eat.vn, and vietnammm.com accounted for a significant minority of them, 6%, 3%, and 4% respectively (Exhibit 4.15)
Demand for food delivery from multi-restaurant websites
For all persons who are aware of food delivery service through multi-restaurant
websites will continue to answer if they have ever ordered delivered food via this type of service As is shown in the pie chart that approximately two-fifths of them (39.6%)
reported that they have used service offered by multi-restaurant websites, whilst non- users contributed to just over three-fifths of them (60.4%) (Exhibit 4.16a) In term of occupation of people knowing this service, it can be noticeable that the percentage of multi-restaurant website users include employees (22.7%), students (15.6%), business owners (1.3%), which was lower that that of non-users (Exhibit 4.16b)
The question of what meals multi-restaurant users order food delivery for is
used to ask the users Surprisingly, dinner is the most frequent meal that users often
enjoy food from multi-restaurant websites In fact, a large percentage of multi- restaurant users (66%) order delivered food for their dinner The second most regular meal is tea breaks, and nearly half of users (49%) stated to have food delivered to their locations for tea break time Moreover, lunch was chosen by approximately more than
Trang 3336.1 % and 29.5% of total users respectively However, the percentage of students prefer choosing dinner (26.2%) and tea breaks (18%) for food delivery, while business
owners only ordering delivered food via multi-restaurant websites for their dinner
make up 3.3% of total users (Exhibit 4.17b)
For expected delivery time, nearly half of users (49%) prefer receiving their food from 30 to 40 minutes, and just over two-fifths of them (41%) would like to get
food within 30 minutes Other options such as 41-50 minutes, 51-60 minutes and over
60 minutes were chosen by 5%, 2%, and 3% of all multi-restaurant users respectively
(Exhibit 4.18)
The users are also asked what type of payment methods they would like to apply A large majority of total users (90.1%) choose cash on delivery method, whereas only 9.8% of them want to settle their orders online None of them select the option of other methods (Exhibit 4.19)
The amount of money that users would like to spend on food delivery service
via muiti-restaurant websites is worth taking into consideration Actually, just over three-fifths of total users (62.3%) were willing to pay from 100,000 to 200,000
Vietnam dong for this service, while nearly a fifth of them (19.7%) chose under
100,000 dong orders The remaining options for over 200,000 to 300,000 dong and over 300,000 dong were selected by small percentage of users, 11.5% and 6.6%
respectively (Exhibit 4.20) The most preferred option of 100,000 — 200,000 dong
orders was chosen by employees (37.7%), students (23%), and business owners (1.6%) Orders having value of under 100,000 dong was second most chosen option, and 13.1 percent and 6.6 percent of total users prefer this option Moreover, employees, students and business owners who choose to pay for over 200,000 to 300,000 dong represented 6.6 %, 3.3% and 1.6% respectively The last option of over 300,000 dong was selected by a very small minority of all multi-restaurant users (6.6%) (Exhibit
Trang 34Factors affect respondents’ decision on using services from multi-
restaurant websites
It was clearly found that there were three groups of total respondents completing this questionnaire, and they are those who don’t know and don’t use food delivery
service via multi-restaurant websites (40%), those who know and don’t use this service
(36%), and those who know and use service offered by multi-restaurant websites (24%) In fact, most of total participants belonged to the first group (Exhibit 4.21)
Therefore, it can be noticeable that two first groups of respondents should be
combined into one group named non-users of multi-restaurant websites (76%), while
the other group should be known as food delivery users via multi-restaurant websites
(24%) (Exhibit 4.22)
Actually, the users of online food ordering service via multi-restaurant websites
answered why they did not use this type of service Two most chosen reasons for non-
use of this service were that non-users don’t know the existence of multi-restaurant websites (43%) and worrying about the quality of delivered food It was followed by the third reason for non-use was that they prefer enjoying hot food served at
restaurants, and nearly two-fifths of non-users (36%) stated that they were keen on cooking at home Moreover, enjoying atmosphere at restaurants accounted for a significant percentage of them (31%), while paying higher price for food delivery compared with enjoying food directly and receiving take-away food made up 27% Besides, a small number of non-users (15%) reported that they would like to talk with live persons like staff, managers, restaurant owners so that they could know more about their preferred food served at restaurants Other reasons (2%) were that they preferred other ordering methods and they didn’t trust this service (Exhibit 4.23)
For multi-restaurant users, they gave their opinion regarding benefits of ordering food delivery online via multi-restaurant websites The most strongly agreed benefit
Trang 35represented nearly two-fifths of total users (39%), while available reviews and restaurant information on multi-restaurant websites was agreed most by nearly two- thirds of the users (64%) Furthermore, multi-restaurant users stated to agree with
benefits of saving time on cooking (56%), controlling the number of selected items and
their prices (54%), a wide range of restaurants available to choose from (54%), and freedom to choose and order delivered food whenever they want (51%) However, it was found that nearly more than two-thirds of users (44%) disagreed with avoiding misunderstanding in ordering with waiters/waitresses The second most disagreed benefit was that users don’t have to wait for their turns to order food (34%) It is
indicated that saving cooking time was most strongly disagreed benefit (11%) (Exhibit 4.24)
Late food delivery was considered most agreed disadvantage of this service,
which accounted for the largest percentage of 69% Failure in keep food hot to
locations was agreed by 66% and strongly agreed most by 19% of users Additionally,
just over three-fifths of multi-restaurant users (61%) said to agree that high minimum delivery fees was considerable disadvantage of this service Nearly half of users (49%) agreed with higher price offered by multi-restaurant websites because of added
delivery fees, and it also was most strongly disagreed disadvantage (12%) (Exhibit
4.25)
The last questions of the questionnaire aimed to investigate respondents’
Trang 36through multi-restaurant websites It is clearly that multi-restaurant users who did not want to keep using this service made up a very smail minority of total respondents
(0.4%), while non-users of this service not ordering delivered food from these websites represented almost one-in-ten (9.8%) of all respondents Amazingly, respondents who stated that they maybe use this service consisted of non-users (52.2%) and current
users (6.3%) (Exhibit 4 26b) Analysis of findings
Eating habits of respondents
Most of respondents have their major meals at home, while some of them prefer
having food outside like restaurants, coffee shops, street food shops In fact, Vietnamese people have been familiar with enjoying their meals with their family members at home especially for breakfast and dinner At that time, they can spend time on gathering together at home However, many of respondents having lunch and
breakfast at their workplace when they want to save their time on other jobs
Moreover, home-made food was chosen by a large number of total respondents
for dinner and lunch, whereas take-away food was the most common option for breakfast and tea breaks There was demand for delivered food which was ordered
most at lunch time and tea breaks It appears that Vietnamese people really enjoy cooking food at home, so they often spend time on prepare lunch in the mornings and
take them to work or to study In Vietnamese culture, family members should come
home and enjoy home-made food made by their mother or wife together, which
explains why a large majority of respondents choose to eat home-made food for dinner
Nevertheless, those who don’t have enough time to cook for breakfast will buy take- away food to save more time It is also similar for tea break time when they often want
to buy food outside and take them to their places Furthermore, some employees are too lazy to go out for lunch and tea breaks, so they often order delivered food to their
Trang 37When choosing food for their meals, a large number of respondents chose
Vietnamese rice for their lunch and dinner Actually, most of Vietnamese people are accustomed to eating Vietnamese rice for their major meals, and rice is considered as
indispensable dish in daily meals of the Vietnamese Additionally, a significant
proportion of respondents stated that fast food is their most frequent choice for
breakfast Besides, most of respondents enjoy drinks like coffee, milk tea, smoothies at tea break time
Demand for food delivery services
It is clearly shown that most of respondents are users of food delivery service in
general, and employees have demand for delivered food most When they are too busy
to cook for meals, food delivery service is considered a simple solution Most of them
order food by calling to restaurants, and the most preferred food for delivery was fast
food In fact, online food delivery services seem similar to the trend of food delivery service in general However, respondents are acquainted with order food delivery from
restaurant websites like fast food restaurant chains, and sometimes they ordered via Facebook pages
Demand for online food ordering services via multi-restaurant websites Just over half of total respondents are aware of services provided by multi- restaurant websites, and most of them are employees and students These people know this service through Internet, their friends and family members Actually, there are many online advertising of multi-restaurant websites on the Internet, which makes this service popular in public Some customers of this service may share their experience
on using these multi-restaurant websites to their friends and family members, and then they may try experiencing this service
Foodpanda.vn is considered the most popular site for allowing customers to
order food online, and most of users receive food delivery from this website A good
Trang 38and most of them are employees It is clearly seen that multi-restaurant users prefer
ordering food delivery for lunch, tea break and dinner Employees use multi-restaurant websites for their dinner and lunch when they spend most of their time on working, whilst students want to have delivered food for tea breaks and dinner It is easily
understood that some students who come from provinces and live alone choose to order food delivered because of its convenience Maybe they don’t want to spend time on buying and cooking food Most of multi-restaurant users expected to receive food from
under 30 minutes to 40 minutes They choose this service because they are too busy to cook; therefore, they don’t want to wait for long to get food in order to save more time
on other jobs Almost all of users prefer the method of cash on delivery because
Vietnamese people still want to settle their orders by cash rather than by online
payment, and they consider this method much more convenient and easier Moreover, a large percentage of users prefer to spend from 100,000 to 200,000 Vietnam dong on online food ordering services
Factors of use and non-use of online food ordering services
Reasons making respondents refuse to use online food delivery from multi-
restaurant websites are quality of delivered food, unawareness of the service,
preference for cooking, and higher prices In fact, many of them don’t know that they can order food delivery by multi-restaurant websites They are also worried about the quality of food delivered to their locations, and they tend to enjoy hot food served to
their tables Some of them really enjoy cooking with their family, and they don’t think
that they should spend money on that service
Most of users ordering food online through multi-restaurant websites due to its
offered convenience and control A large number of users stated that they chose this
Trang 39orders; however, this service will allow them to consider this problems carefully and avoid mistakes Actually, available review and restaurant information are valuable for those who have not experienced the selected restaurant before Moreover, a wide range of different restaurants available for ordering is also one of factors attracting people to
use this service
Users of this service also gave their opinions on disadvantages of multi- restaurant websites which they are not happy with The quality of delivered food was
agreed by most of users who experience the food that fail to be kept hot to locations of customers Late delivery was considered as one of problems of using multi-restaurant websites for ordering food online In fact, some restaurants have their own delivery
team to be in charge of bringing ordered food to their customers, while other
restaurants use delivery service from multi-restaurant websites Additionally, many of users were not happy with high minimum delivery fees When a customers want to
order food only for himself or herself, it was likely that they may refuse to use this
service because of minimum fees Also, they are not satisfied with higher prices including delivery fees
A very small number of respondents don’t want to order food online through
multi-restaurant websites, while a large percentage of them choose to use and maybe
Trang 40Chapter five: Conclusion
The designed questionnaire gave contribution to find out market potential of
ordering food online through multi-restaurant websites by understanding respondents’
behavior towards this new type of service Actually, the eating habits of respondents, demand for food delivery services offered by multi-restaurant websites, and what affect their decisions on choosing this service were clearly investigated in this questionnaire Just over three quarters of all surveyed participants (76%) revealed that they have not
used multi-restaurant websites for ordering food online, and nearly a quarter of them (24%) have experienced this type of service Nevertheless, only a very small minority of respondents (10.2%) refuse to order food delivery via multi-restaurant websites, and the remaining of them (90.8%) have a tendency to use this service Furthermore, a large majority of total respondents (69%) had demand for food delivery services, and a significant proportion of food delivery users (61%) also stated that they ordered
delivered food when they don’t have enough time on cooking for themselves and their
family Besides, the most well-known website for online food ordering service was foodpanda.vn Additionally, fast food was chosen by a large percentage of food delivery users (81%) Actually, muiti-restaurant users revealed that they often ordered food online via these websites for lunch, tea breaks, and dinners, and almost all of them chose to pay cash to delivery guys when receiving food (90.2%) Moreover, most of
users ordered delivered food online via multi-restaurant websites because it offered
great convenience To be more specific, most known benefits of this service were
available review and information of restaurants, ease of use, a wide range of different restaurants, and the ability of controlling the number of selected items and their prices,