Hungry consumers are boosting food delivery services at a fast pace. This is appetizing news for key players Caviar, DoorDash, Grubhub, Postmates, and Uber Eats. Convenience and immediacy drive customer use for on-demand services. Restaurants, especially quick service (QSRs) and fast casual, are becoming more dependent on this sales channel. The restaurants’ tradeoff is more volume in exchange for paying fees to the delivery providers. Consumers will win as delivery firms are offering promotions and discounts to gain market share in high usage areas.
A Recode article discusses more on this topic which is excerpted below.
Uber Eats is the fastest-growing meal delivery service in the U.S., bringing in nearly as much new customer revenue as Grubhub.
People are now spending more on Uber Eats than on any other food delivery service in nine of the 22 most-populous U.S. cities, according to data from Second Measure, a company that analyzes billions of dollars worth of anonymized debit and credit card purchases.
Six months ago, Uber Eats dominated in just three Texas cities: Houston, Austin and Dallas. In the time since, it’s beaten out Grubhub in El Paso, DoorDash in Fort Worth and Postmates in Phoenix, and even Amazon Restaurants in Amazon’s home city of Seattle.
However, this isn’t necessarily an example of Uber Eats eating Grubhub’s lunch (or that of other services). Rather, the market for food delivery is growing fast enough that the competitors have plenty of business to gain — and not just from each other. Overall food delivery sales grew 51 percent from August to March, according to Second Measure.
Overview by Raymond Pucci, Director, Merchant Services at Mercator Advisory Group