On-demand food delivery services are gearing up to become even bigger, as consumer demand for these services rises during the pandemic due to changing food ordering habits. Here are some recent developments in the space:
The coronavirus pandemic is changing the way consumers order their food. Consumer demand for online food ordering has increased: Prior to the pandemic, 62% of US consumers said they ordered food online at least once per month, while 78% said they either maintained or increased how often they ordered amid the crisis. As a result, US digital restaurant marketplace sales via platforms such as DoorDash and Grubhub more than doubled in 2020, per eMarketer forecasts from Insider Intelligence. Meanwhile, sales increased for providers that helped power digital ordering and delivery last year: Olo’s revenues grew to $45.7 million in 2020, for example.
Food delivery service providers are now looking to bolster their offerings to position themselves for growth as the pandemic subsides. Many consumers likely turned to on-demand delivery services in 2020 out of necessity since the pandemic heightened the risk of indoor dining. But now that pandemic conditions are improving thanks to recent vaccine efforts, some customers may decide to return to in-person ordering and indoor dining. This could pose a risk for companies like Amazon Food and Deliveroo, which depend on digital ordering for revenues. However, it may not be all doom and gloom for these providers, considering 12% of consumers said they may never return to in-person dining and others may still lean on them because of convenience, which consumers still value. By expanding their businesses and shoring up their finances, the on-demand delivery firms can position themselves for long-term growth.
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