What can food delivery really deliver?
How brands can increase value and unlock revenue
More than half the British adult population have had a takeaway delivered in the last six months. So what does food delivery offer brands as well as customers?Please don’t judge me, but I’m eating more takeaway food than ever before. A handy update from Cleo* tells me that my month-on-month spending on Deliveroo is off the charts. Reassuringly though, it appears I’m not alone.
According to CGA Peach** more than half the British adult population have had a takeaway delivered in the last six months, 28.6million people in total. The leading players such as Just Eat, Deliveroo and Uber Eats are gobbling up a market that McKinsey*** estimates is worth £73 billion a year globally.
Like many rapidly growing sectors, the catalyst to growth lies in the mutual benefits for the consumer and the brand. For consumers, these brands offer a huge range of culinary options, with established names such as Wagamamas, Itsu and Pizza Express all accessible via a couple of taps on a smartphone. For brands, these platforms offer an opportunity to grow revenue without the need to open more restaurants.
So surely all restaurant and casual dining brands should be falling over themselves to gorge on the opportunities that home delivery promises? Well, that depends. Just as eating too quickly can cause indigestion, rushing into the delivery market without first giving careful consideration to the customer experience can do more harm than good.
In my (ahem) numerous encounters with food delivery from a range of brands, I’ve had some fantastic experiences and, sadly, some pretty ugly ones too. At their best, brands can deliver a home dining experience that genuinely feels like an extension of their on-site offering. While the quality of the food is hugely important, the brands that do it best have also carefully considered every element of presentation and packaging.
At the other end of the scale, there have been some distasteful experiences. These include a dry, almost cold burger that had collapsed into several pieces in the brown polystyrene box in which it arrived. This will live long in the memory - for all the wrong reasons.
This brings us to the real opportunity that lies within food delivery: the chance to deliver a fantastic customer experience of your brand within a home environment, which in turn will in-crease lifetime value from existing customers and unlock revenue from new ones. Or to put it another way, the risk of delivering poor experiences is that they will lower the likelihood of future custom, whether via home delivery or at a restaurant.
Where next for the food delivery customer experience? Once all elements of the product have been finely tuned, there are further opportunities for brands to capitalise upon. These could include cross-selling a wider retail offering (cooking kits, food gifts, cook books etc.), or incentivising repeat purchase through on-pack promotions.
Brands looking to surprise and delight may consider partnerships with complementary offerings. Pizza Hut’s fantastic Now TV day pass giveaways are a great example, which make perfect sense given the connection between sharing pizza and watching sport or films as a group. Enhancing the experience in this way builds loyalty and creates demand.
Lots to consider, then, for brands looking to take their dishes to doorsteps. All that remains is for me to work out what I’m cooking tonight (who am I kidding!)