In 2020, food delivery services are thriving. The demand for outsourced meal delivery solutions surged as the coronavirus pandemic shut down indoor dining while stay-at-home orders urged people to opt for to-your-door delivery services.
UberEats, Postmates, GrubHub, DoorDash, and
other services stood as staples during the pandemic. But, as users are
depending on their favorite services more than ever before, the market is
getting smaller as companies collide.
Uber recently announced a $2.65 billion deal to purchase Postmates. This
acquisition marks the largest merger for the food delivery industry at a time
when the business is booming.
If you haven’t been doing so already, here’s
why you need to be watching the food delivery sector.
The
Value in Food Delivery
In the past, not every restaurant was
compatible with food delivery services. Only a select few in every community
were operational with these convenience-based order pick-up options.
However, the tables have turned during the
pandemic as food delivery services became a necessity for restaurants to stay
alive.
In the post-COVID world of business, this
integration no longer stands as a commodity, luxury, or option - it’s a must.
Even 5-star restaurants are fulfilling orders through services like UberEats,
which before was unheard of.
Stats collected in the past few unprecedented
months showcase the importance of third-party delivery apps. A small local restaurant reported that, before
the coronavirus, it only saw about 20% of its orders being made through food
delivery services. But, during the pandemic, a whopping 75% of orders are
coming from these same apps.
For restaurants as a whole, 92% of traffic is now off-premise, while the
average online order is 23% larger than in-person checks.
Consumers are concentrating their spending on
these services right now, and it doesn’t seem like things are set to slow down
anytime soon. In order to stay afloat and keep the orders coming, restaurants
are linking up with third-party delivery service providers.
The future of the restaurant industry looks
like it lies in the hands of delivery apps.
Keeping
Up with Competitors
Even restaurants with their own delivery
services are being forced to transition into the world of third-party delivery
apps.
In today’s business atmosphere, restaurants
that are not listed on delivery apps risk being overstepped by competitors. As
customers stay at home and don’t know who’s open, it seems like an eatery’s
delivery-app presence is their primary presence.
All About
Trust
In a climate like this one, it’s not
surprising that restaurant customers are choosing app-powered delivery services
rather than the in-house model. This extreme funneling of business all boils
down to trust.
With these tech-powered apps, consumers are able to track their orders from the
kitchen to their door. They’ve already used these services in the past - and
even if they haven’t, they surely know someone who has. These businesses are
socially established and in good favor with consumers, so it’s no wonder why
they’re beating any other alternative.
This monopoly on the restaurant scene is
gaining momentum with the recent merger between Uber and Postmates. Be sure to
keep an eye on this service industry as it’s set up for success in the future.
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