Online food delivery is growing rapidly. Before the pandemic closed thousands of establishments, the U.S. restaurant industry. The U.S.
grew by 3 to 4 percent per year. Delivery sales increased approximately twice that rate (from 7 to 8 percent). While population growth was a factor, most of the increase came at the expense of the grocery sector, as millennials and Generation Z preferred the convenience of prepared meals. The direct-to-consumer sales trend was highlighted during the COVID-19 pandemic.
Subscriptions and contactless delivery on small and large purchases of groceries and meals make it easy for isolated customers to buy exactly what they want during the global pandemic. Shopping online allows consumers to plan what they are going to buy and to research specific products easily and quickly. Small businesses have found significant momentum in their businesses through the online channel. E-commerce has been the savior of many small local businesses that faced a grim picture when blockades forced their doors to close.
Comprehensive personalization helps ensure that customer preferences, such as food allergies, are taken into account at every meal and that dietary recommendations are more accurate. A platform-to-consumer food delivery model is a business model where customers can get their favorite food by placing an order through their smartphones. Food business owners who can offer a more sustainable option and clearly market their green credentials will be able to take advantage of this growing trend. Hyperlocal food delivery became the focus of attention during the pandemic to address one of the biggest problems that food companies faced with third-party delivery companies, such as UberEATS: commissions.
There are subscriptions in all areas of food delivery, from subscriptions to third-party fast food delivery services, such as “Eats Pass” from Uber Eats, to subscriptions to popular recipe boxes. According to the Food Information Council, pre-prepared fresh meals, menu kits with raw ingredients and other home food kits that save customers time are the main attractions for 55% of millennials, who prioritize convenience over consistent flavor. The advent of food delivery apps has increased the speed and accessibility when it comes to getting your favorite foods. The trend of home subscriptions has found a perfect match both in specialized online food delivery and in the millennial generation.
This is an edited extract from the report Online Food Delivery — Technology Trends prepared by GlobalData Thematic Research. The benefit of food companies working with local hyper-local food delivery organizations is obvious: smaller fees translate into greater profits. Rappi, based in Bogotá (Colombia), is an example of a multivertical delivery application that combines food delivery with other orders (through services such as RappiFavor or RappiCash), while Uber Eats and DoorDash have begun to explore the possibility of stacking orders as part of their food offerings. This type of delivery is likely to reach the food industry, and some companies, such as JustEat, are already testing drones for fast food delivery.
North America is one of the largest markets for international online food delivery; it currently represents the largest online food delivery market in the world.