The delivery market has a huge potential revenue so it is not a surprise to see that the entire industry is evolving at a very fast space. Obviously, this was also dictated by the coronavirus pandemic since it forced countless restaurants to start offering delivery services, even if they did not consider this in the past. At the same time, new industry players are changing, like Shift.Online launching Shift Shopping.
Consumers buy more food when they use delivery than when they go to a store. This is the true reason why there is an increase in the demand for such a service. The big problem for restaurants is that it is very difficult to launch a delivery system. The use of the third-party providers seems to be a much better option.
As expected, the largest demographic that uses delivery apps and delivery websites is made out of millennials. As they make more money, there is a very high possibility that they are interested in services that increase convenience. Delivery helps solve countless problems for millennials and even if it just makes up 3% of the entirety of the restaurant business, it is clear that it is growing and specialists expect it to grow really fast.
As in-person dining is losing ground in front of delivery, the growth that we can expect is difficult to calculate. Analysts have different opinions about this. What Statista says is that the segment will grow to a value of $24 billion from the 2019 value of $18 billion by the year 2023. Since the pandemic is creating an unexpected scenario, this statistic might be reached much sooner.
While the delivery market is changing and the potential revenue numbers are huge, there are also many challenges that appear. Besides the obvious lack of interaction between the restaurant and the customer, we have to mention the delivery fees.
Restaurants are expected to create their own programs for delivery. This is because of avoiding paying delivery partner fees. As an example, Uber Eats charges 30% per order, which is huge. At the same time, it is difficult to deal with the food getting cold while the delivery happens.
What is interesting is that the larger national brands are having good results after partnering with delivery businesses. For instance, Wendy increased its brand awareness and even improved its sales after such a partnership. Statistics showed that average check size was around 1.5 to 2 times higher when looking at the delivery orders, all while customer satisfaction was very high. And Wendy is not the only one, with many other large chains interested in this, including Starbucks.
On the whole, the delivery industry is expected to continue. We are looking at very good results and it is practically impossible not to take into account the effect of the coronavirus pandemic on the entire food delivery industry. What will be interesting to see is what will happen once the pandemic slows down, even if the new systems implemented will most likely remain active and people are getting used to using delivery networks.