Evidence-based equilibrium analysis of two-sided market in food delivery industry

Hanseul Jo and Jungwoo Shin

Journal of Retailing and Consumer Services, 2024, vol. 77, issue C

Abstract: The food delivery service market is growing rapidly, driven by the increasing demand for online platforms. This study focuses on the crucial issue of determining appropriate delivery fees to ensure sustainable development of the delivery service industry. The choice experiment analysis is used to examine the platform-based market structure and determine the pricing principles from the perspectives of individual customers and restaurant owners. The results define appropriate utility-based equilibrium service prices, estimated to be less than 10% of the total expenses, even to be less than 7% for multipoint services. This data-driven analysis provides meaningful implications for both service users and platform companies for comprehensive understanding of the market structure.

Keywords: Equilibrium price; Food delivery; Heterogeneous preferences; Mixed logit; Platform; Two-sided market (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:joreco:v:77:y:2024:i:c:s0969698923003971

DOI: 10.1016/j.jretconser.2023.103646

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