Mail-Order Food Business Market in Japan: Key Research Findings 2020
Yano Research Institute (the President, Takashi Mizukoshi) carried out a survey on the domestic mail-order food business market and found out the market trends, trends of market players, and future perspectives.
The mail-order food business market in FY2019 is projected to increase by 3.2% from the previous fiscal year to attain 3,808,600 million yen. Drinking water, rice, liquors, and health food tend to be frequently bought through mail-order services, because they are habitual and valued if available. Also, the food with heaviness to carry is apt to attract demand for mail-order services.
FY2019 was a difficult year for the mail-order food business market, because of smaller demand for drinking water than the previous fiscal year due to cool summer and subdued consumer spending caused by the consumption tax hike. On the other hand, a series of natural disasters throughout the nation brought about higher awareness to keep food for emergency, which drove some consumers to buy food in bulk through the mail-order services.
New coronavirus pandemics from end of the fiscal year encouraged consumers to buy food in bulk through mail-order services for avoiding crowd at supermarkets or other stores. However, it was after April 2020 when the influence of pandemics expanded and “a state of emergency” was declared. Therefore, the growth rate of the mail-order food business market for FY2019 is likely to be the same level as usual years, failing to enjoy much of the benefits from increasing demand.
Influence of COVID-19 Pandemics to Mail-Order Food Market
The concerns over the new coronavirus infections started since around the latter half of January 2020, but the influence was not obvious until the end of February when schools began closing temporarily. The demand for stocking up on food expanded as more people started staying home because of temporary closure of schools, introduction of telework, and self-restraint required for non-urgent or non-necessary outing. In particular, the demand for mail-order food services that deliver food to people’s home soared, as people kept from going out and avoided the crowd at supermarkets. Some service providers had to even limit acceptance of the orders because of their overcapacity for shipment or because some products became out of stock.
Not only the demand for daily food but also for some rare gourmet products and sweets available at specific shops or regions, or expensive food originally for gifts have also increased. Because COVID-19 restricted people from travelling or dining out, “food” became the only pleasure for people staying home to enjoy, which encouraged them to order, for instance, expensive hamburger steak dishes and sausages from mail-order food services to bask in a little more luxury lunches or dinners than usual. In particular, this May the ratio of people staying home increased under the declaration of a state of emergency and boosted the demand for mail-order food business, whereas May in usual years falls into the period of Golden Week, a long-lasting vacation period for people to travel around, no room for mail-order food.
The special demand during the state of emergency declaration somewhat subdued after the declaration was lifted in June, but mail-order food services seemed to be continuously in high demand, as the number of infected people was on the rise and as the second and third waves of infections were concerned. It is possible for the consumers who used the mail-order food services for the first time in this COVID-19 calamity to become the repeaters after they recognized the usefulness and high quality in the products and services.
FY2020 saw prominent growth in the mail-order food business which delivers the edible products to customers’ home, as consumers avoided crowd at supermarkets and other stores after the declaration of a state of emergency was issued. Because the ratio of people staying home was high this May, though the ratio is low in usual years, the demand for both daily food and food for gifts increased remarkably. After June when people become active again as schools and offices resume, the mail-order food service providers are likely to be divided into those that are able to keep being in high demand, and those that end up with temporary growth.
For instance, mail-order services, online supermarkets and direct sale services by food manufacturers are apt to accept one-off orders, with no subsequent orders can be expected. Therefore, rapid growth in demand is likely to be limited to during the state of emergency declaration.
On the other hand, the channels in the form of subscription such as Co-op delivery services and natural food delivery services are considered to keep being demanded even after the state of emergency declaration being lifted. It is unthinkable for the demand for such services to return to the size before the pandemics. Users who have experienced the usefulness are expected to continue using the services, while groping for appropriate purchasing frequency and volume depending on their lifestyles and conditions, now that people are required to learn to live “With Corona.” The domestic mail-order food business market in and after FY2021 is forecasted to lead a gradual expansionary course, with the growth rate slowing down, and some differences in growth and diminishing level observed among service providers contingent on the business forms.
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