Kiwan Ihn, the Chief International Officer at foodpanda started off his career as a marketer at L'Oreal and then moved to McKinsey & Company where he spent the following 10 years providing consultancy services for worldwide businesses. In 2019, he took up the role of Head of Global Business at Woowa Brothers - one of the fastest-growing unicorns in Korea before getting officially appointed as CEO of Woowa Brothers Vietnam. In 2022, he became the Chief International Officer overseeing the operations of multiple countries in Asia of Woowa DH Asia.

Following are the edited transcripts of a recent conversation BR Research had with Kiwan Ihn that revolved around Pakistan’s q-commerce industry and its related challenges and opportunities:

BR Research: Tell us a bit about yourself, background, role and how you ended up working for foodpanda? What inspires you?

Kiwan Ihn: I joined Woowa Brothers in late 2018 as we were ready to start the company in Vietnam, where I have since served as CEO and am currently the Chief International Officer (CIO) for foodpanda. I began a new position in March 2021 to manage foodpanda in Japan, and in 2022 I began working as the CIO primarily for Pakistan, Bangladesh, Singapore, Hong Kong, and Taiwan.

I believe inbuilding something from scratch, which is why I enjoyed the journey in Vietnam because there were competing firms there and the market was generally competitive. Nevertheless, we were successful in operating our business there despite the market challenges. I get so much enthusiasm from the Pakistani market that it truly motivates me to concentrate on new ideas. We don't work solely for the numbers because that's not very inspiring; instead, we enjoy discussing and brainstorming new ideas. That is how I prefer to lead.

BRR: How committed do you think foodpanda and Delivery Hero is to the Pakistani Market?

KI: We are pretty committed for a variety of reasons. Pakistan is a fast-growing market and is highly penetrable. There are a few markets where we already have an established presence such as in Taiwan, there the question is more of how we can continue and maintain our position. But if you look at the other side including Pakistan, Bangladesh, Cambodia, Laos Myanmar and others, the market penetration is very low. So this is where we come in by pulling in capital and people. So far foodpanda in Pakistan has put in millions of Euros and we are committed to putting in more and more because there is huge potential here. If we were not committed enough, then we would not have invested this much capital and also would not have replicated this business model in other countries too.

BRR: What are the key challenges while addressing the huge market potential?

KI: There are a few internal and external challenges. External challenges include the current market situation, high fuel prices, rising inflation, and global recession, which implies that there is reducing disposable customer income. We have more than 50,000 riders that are registered on our platform, they are being directly impacted by the rising fuel prices. So you can say that the overall situation is pretty challenging. Internally, there is a change in investor perception, from growth to profitability. It is not only us but other big players who are also facing the same challenge. Obviously, there is a need to prove that we are sustainable. Having said that, it is not an easy game for sure but these challenges are only making us stronger. These hard times will decide the strongest player in this fast-growing market.

BRR: What are foodpanda’s plans for the next couple of years?

KI: We want to maintain a diverse customer experience when it comes to food. Firstly, we want to grow food delivery as our main business within the coming two years. Secondly, we want to focus on q-commerce like pandamart which is very successful here, in fact the most successful out of the 11 countries we operate in. Thirdly, there are other ecosystems that we are building mainly kitchen visits and HomeChefs. Not only do these bring in a different experience for the customers, the food users, but also the riders and the food vendors. If we go further, maybe we will try to give a more diverse experience to the users by building a YouTube-styled experience on our app rather than just browsing before ordering.

BRR: In your view, what is the scope of e-commerce in Pakistan? Have we reached the inflection point here?

KI: Global e-commerce market is huge and compared to that, Pakistan’s e-commerce market is still very small. This means that this market can grow fast. At the moment there are a few prerequisites for the market to really take off. Obviously, number one is the purchasing power of the youth, since e-commerce is mostly adopted by younger customers, and number two is the service delivery infrastructure. Out of a population of about 230 million in Pakistan, smartphone user penetration is still very low, as compared to around 89 percent in Korea and 60-70 percent in Vietnam, which is still a developing country. I believe that smartphone user penetration should grow further. Secondly, another prerequisite is the players in the market, including us, which are successfully competing with each other.

BRR: How is the global recession affecting you? With falling VC funding across startups, including those in Pakistan amid an ongoing financial crunch, are there any changes in your business model which primarily rested with growth at all costs?

KI: We are not really seeking VC funding like most startups, but still it is important that we show our financial stability. Investors are mostly focused on progress, and we want to show that. For example, when most of our regional competitors were laying off people and reducing their headcount, we did not opt for that because it does not reflect stability. Comparatively, we are more focused on enhancing our efficiency to satisfy our investors.

BRR: How did you adjust your business model during the pandemic? Was it the same across all markets?

KI: During the pandemic, since food delivery was banned everywhere, we started offering food pickup service – which is contactless delivery. We also educated our riders on how they can manage food deliveries without facing any risk of contracting or spreading the Covid-19 virus. We also introduced the HomeChefs program during the pandemic; not only did we train them but also created a supplementary income opportunity for this segment. We also invested in keeping our riders safe by getting them fully vaccinated and complimentary distribution of PPE equipment.

BRR: We have seen verticals like HomeChefs which are quite successful and we understand this vertical started in Pakistan. What are your plans for growing this vertical in the future as it directly impacts financial inclusion and women empowerment?

KI: The HomeChefs program helps to fill the gap of having more vendor selection for our customers. Another exciting aspect of this vertical is that it provides an incremental income opportunity for women by providing their talent to the market. It is not only good for society, but it also helps to create more work opportunities for women. We hope to develop it further in Pakistan and also introduce this program in the other markets we work in. Having government support for our HomeChef program has been very crucial for us. The government has recognized it as a business that is geared towards economic empowerment and financial inclusion, specifically for women. We also collaborated with Government’s Kamyab Jawan program to provide loans for home chefs so they can scale their businesses. In the recent budget, the Provincial Governments of Punjab, Sindh and KPK have also given tax rebates for home chefs, which is a huge win for this segment.

BRR: Are there any further tech enhancements planned - new products or features that improve customer experience and positively impact our communities?

KI: We are aiming to connect the experience of dining with our platform which will not only offer value-added benefits to the customers but will also help to increase customer footfall at the restaurants. We are also aiming to leverage our 50,000+ riders through PandaGo, which is an on-demand rider service for businesses so our riders can earn more income and at the same time provide convenience to other businesses as well. We are also aiming to expand e-bikes for riders so we can be more environmentally friendly. And we are also testing to induct robotics in commercial and delivery operations across the region.