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The Online Foodservice Consumer - US - August 2016

"Delivery is an exciting new opportunity within foodservice as the rise of third-party restaurant delivery companies makes it possible for nearly every restaurant to deliver directly to consumers, an occasion long dominated almost exclusively by pizza restaurants. While the restaurant delivery market is growing, the future of restaurant delivery is unclear as many of these third-party restaurant delivery companies are operating in a crowded market. Consumers do enjoy the convenience of ordering in, but the added costs of delivery prevent it from becoming a more frequent occasion."

- Caleb Bryant, Foodservice Analyst

This report will cover the following areas:

  • Third-party restaurant delivery usage is not common
  • Doubt over third-party restaurant delivery exists
  • Half of consumers 55 and over simply aren't interested in restaurant delivery
  • Consumers enjoy the entire restaurant experience

This Report covers the use of/attitudes surrounding restaurant delivery in general as well as third-party restaurant delivery services. It covers changes in the restaurant delivery market, third-party restaurant delivery email marketing, and the utilization of social media by third-party restaurant delivery companies. While pizza restaurant delivery is covered briefly in the Report, pizza restaurants are not the focus of this Report.

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • The issues
          • Third-party restaurant delivery usage is not common
            • Figure 1: Restaurant delivery usage in the past three months, June 2016
          • Doubt over third-party restaurant delivery exists
            • Figure 2: Reasons for not using a third-party delivery service in the past three months, June 2016
          • Half of consumers 55 and over simply aren’t interested in restaurant delivery
            • Figure 3: Third-party restaurant delivery motivators among non-users, by age, June 2016
          • Consumers enjoy the entire restaurant experience
            • Figure 4: Statement agreement, any agree, “It’s more fun going to a restaurant than ordering in”, by HH income, June 2016
          • The opportunities
            • Chain restaurants can capitalize on delivery
              • Figure 5: Delivery statement agreement, “any agree,” by third-party delivery users, June 2016
            • Younger consumers order delivery for a variety of reasons
              • Figure 6: Reasons for having restaurant food delivered, by age, June 2016
            • Capturing the mobile/online delivery users will grow the third-party delivery market
              • Figure 7: Third-party restaurant delivery motivators among non-users, by those who ordered delivery via mobile app or website in the past three months, June 2016
            • What it means
            • The Market – What You Need to Know

              • The younger generation is driving interest in delivery
                • Consumers are cautiously optimistic about the economy
                  • Smartphone ownership is nearly ubiquitous
                  • Market Factors

                    • iGen and Millennials are key consumers
                      • Figure 8: Population by generation, 2011-21
                    • Consumer confidence is in flux
                      • Figure 9: Unemployment and underemployment, January 2007-June 2016
                      • Figure 10: Consumer Confidence Index, January 2007-June 2016
                    • Smartphone ownership has almost peaked
                      • Figure 11: Smartphone ownership over time, 2013-16
                      • Figure 12: Smartphone ownership by age, winter 2016
                  • Key Players – What You Need to Know

                    • The restaurant delivery market is growing
                      • Winners and losers will soon emerge
                        • Delivery companies are carving out their niche
                          • Delivery companies are active on social media and utilizing email marketing
                          • What’s Working?

                            • Chain restaurants see opportunity with delivery
                              • Nonrestaurant companies branch into food delivery
                                • Third-party restaurant delivery companies stay competitive
                                  • Taking cues from pizza delivery technology
                                  • What’s Struggling?

                                    • Are we in a delivery bubble?
                                    • What’s Next?

                                      • Rise of the chef-specific restaurant delivery service
                                        • Innovative pricing strategies ease consumer concerns
                                            • Figure 13: Munchery email, “Membership Announcement”
                                            • Figure 14: Postmates email, “Unlimited Free Delivery”
                                        • Restaurant Delivery Competitive Landscape

                                            • Rise of the virtual restaurant
                                              • Corporate catering companies
                                                • Direct from the chef
                                                • ePerformance

                                                  • Overview and methodology
                                                    • GrubHub sends more than five times as many emails than its competitors
                                                      • Figure 15: Projected volume of marketing emails delivered, Feb. 2-June 26, 2016
                                                      • Figure 16: Average email read rate by select companies, Feb. 2-June 26, 2016
                                                    • Consumers are most likely to read promotional/deal emails
                                                      • Figure 17: Top five emails with the highest read rate, Feb. 2-June 26, 2016
                                                      • Figure 18: DoorDash email, “What happened to us?”
                                                    • Happy holidays
                                                      • Figure 19: GrubHub Pi Day email, “Today only – order with Purpose for Pi Day!”
                                                      • Figure 20: Email examples sent for Valentine’s Day
                                                      • Figure 21: Email examples sent for Cinco de Mayo
                                                    • Cross-promotion opportunities
                                                      • Figure 22: GrubHub email “Enjoy HBO NOW with a feast tonight”
                                                    • Inbox overlap
                                                      • Figure 23: GrubHub email “Apple Pay your way to a year of free food!”
                                                      • Figure 24: Overlap analysis for GrubHub email recipients, Top 10 overlap rate, Feb. 2-June 26, 2016
                                                      • Figure 25: Overlap analysis for DoorDash email recipients, Top 10 overlap rate, Feb. 2-June 26, 2016
                                                      • Figure 26: Overlap analysis for Delivery.com email recipients, Top 10 overlap rate, Feb. 2-June 26, 2016
                                                      • Figure 27: Overlap analysis for Seamless email recipients, Top 10 overlap rate, Feb. 2-June 26, 2016
                                                      • Figure 28: Overlap analysis for Postmates email recipients, Top 10 overlap rate, Feb. 2-June 26, 2016
                                                      • Figure 29: Overlap analysis for Munchery email recipients, Top 10 overlap rate, Feb. 2-June 26, 2016
                                                    • Inbox overlap among delivery service competitors
                                                      • Figure 30: Overlap analysis among restaurant delivery email recipients, Feb. 2-June 26, 2016
                                                  • Social Media

                                                    • Methodology
                                                      • Social media presence by delivery companies
                                                        • Figure 31: Social media platforms used by third-party restaurant delivery companies, July 20, 2016
                                                      • The number of GrubHub followers dwarfs competitors
                                                        • Figure 32: Total audience on social media by platform, July 20, 2016
                                                      • Munchery is the most active restaurant delivery brand on social media
                                                        • Figure 33: Total number of posts made by companies in the past 90 days across social media platforms, July 20, 2016
                                                        • Figure 34: Number of posts made per day by companies in the past 90 days across all social media platforms, July 20, 2016
                                                      • Social media engagement metrics
                                                        • Figure 35: Total social engagement across all social media platforms in the past 90 days, July 20, 2016
                                                        • Figure 36: Average engagement per post across all social media platforms in the past 90 days, July 20, 2016
                                                      • What it means
                                                      • The Consumer – What You Need to Know

                                                        • Third-party restaurant delivery users are a specific type of consumer
                                                          • Convenience and relaxation drive the delivery occasion
                                                            • Price prohibits consumers from using delivery
                                                              • Older consumers show little interest in third-party delivery services
                                                                • Mobile/online orders are an important consumer group
                                                                  • Consumers value delivery, but also enjoy the restaurant experience
                                                                  • Restaurant Delivery Usage

                                                                    • Third-party restaurant delivery usage is low
                                                                      • Figure 37: Restaurant delivery usage in the past three months, June 2016
                                                                    • Delivery usage is concentrated among young consumers
                                                                      • Figure 38: Restaurant delivery usage in the past three months, by generation, June 2016
                                                                      • Figure 39: Restaurant delivery usage in the past three months, by age and income, June 2016
                                                                    • Third-party delivery users are young, affluent, urban, and male
                                                                        • Figure 40: Any third-party delivery users indexed against all respondents, June 2016
                                                                      • Hispanics are frequent delivery users
                                                                        • Figure 41: Restaurant delivery usage in the past three months, by age and income, June 2016
                                                                    • Reasons for Using Delivery

                                                                      • At-home comforts and convenience drive the delivery occasion
                                                                        • Figure 42: Reasons for having restaurant food delivered, June 2016
                                                                      • Third-party restaurant delivery users order delivery for a variety of reasons
                                                                        • Figure 43: Reasons for having restaurant food delivered, by third-party delivery users, June 2016
                                                                      • Men and women use for very different reasons
                                                                        • Figure 44: Reasons for having restaurant food delivered, by gender, June 2016
                                                                      • Young people are the target market for entertainment cross-promotions
                                                                        • Figure 45: Reasons for having restaurant food delivered, by age, June 2016
                                                                      • Parents value the convenience of delivery
                                                                        • Figure 46: Reasons for having restaurant food delivered, by parents and age, June 2016
                                                                    • Third-Party Usage Frequency

                                                                      • Third-party delivery users order delivery frequently
                                                                        • Figure 47: Third-party delivery usage frequency, June 2016
                                                                    • Third-Party Delivery Services: Important Factors

                                                                      • Speed, selection, and service are key factors for third-party users
                                                                          • Figure 48: Important factors when choosing a third-party delivery service, June 2016
                                                                      • Non-Third-Party Delivery Users

                                                                        • Price and the restaurant experience deter restaurant delivery
                                                                            • Figure 49: Reasons for not using a third-party delivery service in the past three months, June 2016
                                                                            • Figure 50: Reasons for not using a third-party delivery service in the past three months, “these companies do not operate where I live,” by area, June 2016
                                                                          • Price is a barrier among delivery users
                                                                            • Figure 51: Reasons for not using a third-party delivery service in the past three months, by delivery users, June 2016
                                                                          • Boomers value the restaurant experience
                                                                            • Figure 52: Reasons for not using a third-party delivery service in the past three months, “I prefer to eat at a restaurant,” by generation, June 2016
                                                                        • Third-Party Delivery Services – Trial Motivators

                                                                          • One third of consumers say nothing would motive them to try restaurant delivery
                                                                              • Figure 53: Third-party restaurant delivery motivators among non-users, June 2016
                                                                              • Figure 54: Third-party restaurant delivery motivators among non-users, “If they delivered to where I live,” by those who say third-party restaurant delivery companies do not operate where I live, June 2016
                                                                            • Mobile/online users are interested in third-party delivery, but want deals and a smooth experience
                                                                              • Figure 55: Third-party restaurant delivery motivators among non-users, by those who ordered delivery via mobile app or website in the past three months, June 2016
                                                                            • Deals motivate women to try delivery
                                                                              • Figure 56: Third-party restaurant delivery motivators among non-users, by age, June 2016
                                                                            • Young consumers are open to trying delivery
                                                                              • Figure 57: Third-party restaurant delivery motivators among non-users, by age, June 2016
                                                                            • Sell parents on the simplicity of delivery
                                                                              • Figure 58: Third-party restaurant delivery motivators among non-users, by parents of child(ren) under 18, June 2016
                                                                            • Qualitative analysis: Delivery motivators
                                                                            • Restaurant Delivery Attitudes

                                                                              • Opportunity for chains in food delivery
                                                                                • Figure 59: Delivery statement agreement, “any agree,” June 2016
                                                                                • Figure 60: Delivery statement agreement, “any agree,” by third-party delivery users, June 2016
                                                                              • Those in the Northeast are most interested in chain restaurant delivery
                                                                                • Figure 61: Delivery statement agreement, “any agree,” by region, June 2016
                                                                              • High earners value delivery services
                                                                                • Figure 62: Delivery statement agreement, “any agree,” by income, June 2016
                                                                            • Interest in Virtual Restaurants

                                                                              • Methodology
                                                                                • Young, affluent parents are target consumers for virtual restaurants
                                                                                  • Figure 63: Interest in delivery-only restaurants – CHAID – Tree output, June 2016
                                                                                • Qualitative analysis: Virtual restaurant interest
                                                                                • Appendix – Data Sources and Abbreviations

                                                                                  • Data sources
                                                                                    • Consumer survey data
                                                                                      • Consumer qualitative research
                                                                                        • Abbreviations and terms
                                                                                          • Abbreviations
                                                                                            • Terms
                                                                                            • Appendix – Consumer

                                                                                                • Figure 64: Interest in delivery-only restaurants – CHAID – Tree output, June 2016
                                                                                                • Figure 65: Smartphone ownership over time, 2013-16
                                                                                                • Figure 66: Smartphone ownership by age, winter 2016
                                                                                            • Appendix – ePerformance

                                                                                                • Figure 67: Overlap analysis for DoorDash email recipients, competitive set overlap rate, Feb. 2-June 26, 2016
                                                                                                • Figure 68: Overlap analysis for GrubHub email recipients, competitive set overlap rate, Feb. 2-June 26, 2016
                                                                                                • Figure 69: Overlap analysis for Delivery.com email recipients, competitive set overlap rate, Feb. 2-June 26, 2016
                                                                                                • Figure 70: Overlap analysis for Seamless email recipients, competitive set overlap rate, Feb. 2-June 26, 2016
                                                                                                • Figure 71: Overlap analysis for Postmates email recipients, competitive set overlap rate, Feb. 2-June 26, 2016
                                                                                                • Figure 72: Overlap analysis for Munchery email recipients, competitive set overlap rate, Feb. 2-June 26, 2016
                                                                                            • Appendix – Social Media

                                                                                                • Figure 73: Total audience on social media by platform, July 20, 2016
                                                                                                • Figure 74: Total number of posts made by companies in the past 90 days across social media platforms, July 20, 2016
                                                                                                • Figure 75: Total social engagement across all social media platforms in the past 90 days, July 20, 2016

                                                                                            Companies Covered

                                                                                            To learn more about the companies covered in this report please contact us.

                                                                                            The Online Foodservice Consumer - US - August 2016

                                                                                            £3,199.84 (Excl.Tax)