Globally, online food delivery is growing at an exponential rate following the COVID-19 outbreak in 2020. The pandemic forced many countries, states, and cities to initiate a lockdown, leaving people the option to order food online. As a result, several brands have entered the food delivery market during the coronavirus crisis. In addition, existing food-tech brands have upscaled their businesses.
Here is a look at what the current food delivery market looks like and the major players.
The Growth of Food Delivery Industry
According to DoorDash, 65% of restaurants using its services during the coronavirus pandemic enjoyed increased profits. The pandemic led to notable growth for the food-tech giant. In December 2020, it appeared in the US stock exchange market, and today, it has a market capitalization of over $47.6 billion. Furthermore, in its fourth-quarter earnings report of 2020, its sales increased by 226%, with more than 273 million orders.
Another food-tech brand that saw its revenue increase rapidly during the coronavirus pandemic is Delivery Hero. In the fourth quarter of 2020, it recorded $1.14 billion in revenue. This is double what it made in the previous year. No doubt, the food delivery market is booming. According to Statistica, the market size of the online food delivery sector was $107.44 billion in 2019. However, in 2020, this value has risen to $111.32 billion. It is even expected to hit $154.35 billion by 2023.
Growth Per Country
In the US, the food delivery revenue of 2020 is $26.5 billion, 204% higher than what it was over the past five years. The growth of the market results from the introduction of platform-to-customer services like Uber Eats, DoorDash, and Postmates. According to BusinessofApps, US Food Delivery revenue is projected to hit $42 billion by 2025.
Compared to countries like Italy and France, the food delivery market in the UK has experienced more growth. In fact, it is responsible for almost 40% of the total European takeaway revenue. Among the UK giants in the industry are Deliveroo and Just Eat. In 2020, the UK Food Delivery revenue recorded was $5.9 billion. This is more than 50% of what was recorded in 2015.
Although Europe has a smaller market size when it comes to the food delivery business, it recorded substantial growth in 2020. However, there hasn't been enough push to platform-to-consumer operators. The revenue from food delivery in 2020 was $18.9 billion compared to the $6.6 billion in 2015.
The food delivery market in China is considered the largest in the world, with Meituan Dianpin, and Ele.me being the major operators. The country experienced massive growth from $3.2 billion in 2015 to $51.5 billion in 2020. The value is expected to hit $100 billion by 2025.
With the present speed of food delivery growth, time and resources are becoming tight for industry professionals. Thus, these food-tech giants must adopt sustainable solutions. Thankfully, several technology tools, such as those used for high-quality visual assets, can help.
Many people are moved to order certain meals online because they look good in pictures. But finding freelancers and organizing photoshoots nationwide (and internationally) proves to be time-consuming and resource-intensive for companies, so they turn to specialized tech platforms to achieve better results in a more efficient way. For example, when Glovo partnered with BOOM, their sales increased by 25%.
Current Trends in Food Delivery
Apart from visual assets, food-tech brands have also been using different strategies to help avoid food waste. Food waste, when not disposed of properly, releases methane that contributes to the greenhouse effect. To help reduce this effect, many top food delivery companies now run programs to give excess food back to the community. For instance, DeliveryHero partnered with the United Nations World Food Programme to fight against Global Hunger through their ShareTheMeal donation. And BOOM has partnered with TooGoodToGo, to give a second life to the food used on photoshoots.
In addition, there is more focus on convenience and quick commerce. Giants in the food delivery industry now offer customers a wide range of choices within their platform. This way, consumers can get what they need easily. They also focus on optimizing their business for speed by recording faster delivery times. By personalizing the customer experience, they've also been able to make their customers' decision process faster.
Emphasis on Online Experience
The massive growth of the food delivery industry over the last year and a half shows the need for more emphasis on clients' online experience. Therefore, food delivery platforms should consider adopting strategies and tactics that can help elevate this experience. For instance, they can partner with third-party logistic firms to help them achieve even faster delivery times. They can also partner with tech platforms like BOOM, which will handle the complete management of their visual assets and help them increase conversion by delivering content built to attract customers, generate more clicks, and ultimately, more orders.
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