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Foodpanda axes Foodora after just two months

Just two months after its launch, Foodora, the upmarket sister site of Foodpanda Hong Kong has been axed, leaving a question mark over the future of the Singapore version of the site.

Inside Retail Singapore broke news of Foodora’s Singapore launch in late September after the company trialled the concept in two suburbs of Hong Kong and signed 100 restaurants up.

But this week Foodpanda Hong Kong said it was axing Foodora in Hong Kong, rolling its restaurants into Foodpanda and adopting a single brand.

It disguised the axing of the two month old project in a media statement proclaiming it has “drastically reduced delivery time” of all its orders to “an average” of 30 minutes, a key marketing plank of Foodora.  

“Sister company Foodora, launched in October this year, is also now integrated into the Foodpanda business, in order to have natural synergies and premium expertise. This new integration is an additional step to reinforce Foodpanda’s philosophy and expertise on providing the best food delivery services,” the statement said.

In September, Foodpanda executives were describing Foodora as a high-end delivery service targeting targeting cashed-up Millennials who want a higher standard of meal than quick service restaurant fare and faster delivery – and who parent Rocket Internet expects are happy to pay a premium for it.

Chris Parrott, marketing MD with Foodora, said in an interview with e27 about the Hong Kong site that the two brands are targeting different clientele, albeit meeting the same need: food delivered to the door as quickly as possible.

“Foodpanda is a sister company, so there is scope for knowledge-sharing. We have different target clientele, as our minimum basket size is US$25.8 (HK$200) and Foodpanda’s is variable,” Parrott explained.

Apparently, just two months later, that is no longer the case.

The company says it has developed proprietary rider and restaurant software technology, using an advanced algorithm to optimise delivery courier routes and restaurant operations.

“The company is now able to ensure that steps in the food ordering process occur faster than ever, bringing average delivery down to 30 minutes after the order confirmation.”

As of today, the Foodora.sg website is still branded Foodora and still promotes premium restaurant partners and deliveries in 30 minutes.

Foodpanda is encountering mounting difficulties with its business model in Asia. Last month it closed its Vietnam operation after failing to make a dent in the market share of more efficient, established rivals (subsequently selling its database to one of them).  In Kuala Lumpur it is struggling to win customer confidence after buying up its rivals and shutting them down and operating a monopoly widely criticised for delivery times of often more than an hour, complaints of cold food and poor customer service.

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