Why Consumers Want Delivery

Third-party delivery services like UberEats connect customers to local businesses.
 
Most Americans who use third-party food delivery services agree that it makes their lives easier, and nearly one third (31 percent) say they use these services at least twice a week, according to new research from Mintel. For bakers, this trend points to a growing opportunity to offer home delivery through a third-party service like DoorDash, Grubhub, Postmates and UberEats.
 
Mintel research reveals that “dinner and a movie” is taking an untraditional spin as two in five (41 percent) consumers, including well over half (57 percent) of Millennials, say that they have restaurant food delivered so they can watch movies and TV shows at home.
 
Despite impressive usage among third-party food delivery consumers, the industry is still relatively new. Only 12 percent of Americans say that they have used a third-party delivery service in the past three months, according to the Mintel report. Among non-users, three in 10 say that they would rather order delivery directly from the restaurant itself, citing concerns over price, as more than one quarter (27 percent) believe that delivery fees are too high. What’s more, some 23 percent of non-users say they live in an area where these companies do not operate.
 
Another barrier Mintel research highlights is that many Americans crave the experience of actually going to a restaurant. Nearly 30 percent of those who haven’t used a third-party delivery service say that they prefer to eat at a restaurant. Consequently, more than two thirds (65 percent) of restaurant delivery users agree that it’s more fun going to a restaurant than ordering in.
 
“Restaurant delivery is a hot market right now with many companies vying for the top spots. While usage today is low, it is important to note that the third-party delivery industry is still relatively new and low usage is to be expected, but it presents opportunity for growth,” says Caleb Bryant, foodservice analyst at Mintel.
 
Those who do use these services tend to be Millennial men living in urban areas, indicating a need for these companies to attract a more diverse consumer base, Bryant adds. Delivery cannot compete with the entire restaurant experience, but third-party companies can work at increasing the incidence of restaurant delivery by highlighting the benefits of having food delivered directly to the consumer.
 
Americans who have not used a third-party restaurant delivery service say fast delivery (31 percent), restaurant selection (28 percent), low order minimums (27 percent) and first-use coupons (26 percent) would motivate them to try it.
 
However, there may be no convincing the older generations, as more than half (53 percent) of non-users age 55+ say nothing would motivate them to use these services, compared to 11 percent of non-users aged 18-24 and one third (33 percent) of non-users overall.
 
“Older consumers tend to dine out less frequently than other age groups,” Bryant says. “As such, these consumers may view going out to eat as a more special occasion, not as something to just have at home, while younger consumers tend to be very open to at least trying restaurant delivery services. Third-party restaurant delivery services must assuage consumer doubts and concerns over delivery by convincing them that online and mobile delivery are faster, more convenient options, and by offering deals and incentives to encourage trial. Additionally, as smartphone ownership has almost peaked, restaurant delivery companies must create apps that are easy to use and standout in app stores crowded with competing offerings.”
 

Third-Party Players

 
Grubhub is the nation's leading online and mobile food ordering company dedicated to connecting diners with local takeout restaurants. The company’s online and mobile ordering platforms allow diners to order directly from more than 45,000 takeout restaurants in over 1,100 US cities and London.
 
DoorDash is a technology company that connects customers with local businesses. Through the DoorDash marketplace, people can purchase goods from local merchants and have them delivered in less than 45 minutes.
 
UberEats allows consumers to tap into the Uber network and order almost any food from a roster of local restaurants. The average order takes 35 minutes from start to finish, according to the company.
 
Postmates is transforming the way goods move around cities by enabling anyone to have anything delivered on-demand. The company’s Urban Logistics platform connects customers with local couriers who can deliver anything from any store or restaurant in minutes.