# Online Food Delivery Platforms

Market sizing
New answer on Feb 22, 2021
1.0 k Views

Hi, should I base myself on individuals or households while calculating the market size (number of orders) of online food delivery platforms?

• Date ascending
• Date descending

I'd suggest thinking through whether consumption patterns differ substantially between HHs and individuals. This seems likely.

One could argue an individual will order both on a standalone basis and in a group (HH) and so the smallest unit to model would be per individual.

Then you could always segment this into different segments of individuals e.g.

1 - young, solo living

2 - couple

3 - young family

4 - older couple

Within each of these segments you can then assume order frequency and also taking into account # individuals / HH

Hope that makes sense

Hello!

I would always recommend you to give it a shot and then post it here, this would help you the most.

This is a very typical market sizing case, where the key steps are:

1. Calculate the total population
2. Calculate the % of population that could be interested in this product (this could be done by clustering -the classical ones are age groups, purchaching power, etc.-)
3. Calculate the % of the total adressable market that any firm in particular could have -in case it´s asked only-.

Hope it helps!

Cheers,

Clara

Why not both? You can split your market in single household orders and family orders?

However, you should also assume a different consumption behavior. if you're assuming that the family just orders a multiple of the single household based on the average number of familty members you can just do it on an individual level.

I'd assume a family orders less per head than a single household, because they cook more often and more healthy food.

Consider both..individuals will order more frequently per week, households order less frequently but their average order value with be higher per order.

Either works - just be clear about the assumptions on order value and frequency for each.

Depends only on how you want to structure it and how you reason it - the choice is yours.

Hi there,

Either, or both, could work! The most important is that your assumptions are reasonable and that you understand where you/your household fits in terms of segmentation!