Over the past few years, the food delivery industry has experienced a remarkable surge in growth. This can be attributed to the network effects established by delivery riders and the utilization of advanced route optimization technologies, resulting in more affordable and expedited food delivery services. These factors have played a pivotal role in driving the substantial expansion of numerous food delivery operators.
Furthermore, recent developments have seen various aggregators adopting a platform-to-consumer approach, facilitating seamless delivery and ordering processes.
The advent of the COVID-19 pandemic further accelerated the adoption of online food ordering, as millions turned to this convenient option during lockdowns. Notably, prominent grocery delivery services such as Instacart accomplished their 2023 targets within the first few weeks of the lockdown period.
If you are embarking on developing a food delivery app, it is imperative to gain a comprehensive understanding of the market dynamics, including emerging trends and shifting preferences. Equipping yourself with such knowledge will ensure a secure and informed journey throughout the app development process.
Today, we present you with market statistics pertaining to the food delivery app industry across various global regions and other pertinent data that will prove invaluable to your venture.
Key Highlights from The Food Delivery Industry Data:
- The online food delivery industry has experienced significant growth and has transformed the restaurant sector. It has become an integral part of food technology, providing convenience to consumers.
- According to Statista, the global online food delivery market is projected to reach US$0.91tn in 2023 and exhibit a growth rate of (CAGR) of 12.33% over the period of 2023-2027 leading to a market volume of US$1.45tn by 2027.
- Leading players in the meal delivery sector include DoorDash, Uber Eats, and Grubhub. DoorDash holds the largest market share at 45%, followed by Uber Eats at 22% and Grubhub at 18%. However, competition in the industry remains fierce as new companies continuously enter the market.
- Various food delivery companies have implemented subscription pricing models to incentivize and reward loyal customers with discounts and perks for their continued service usage.
- To enhance operational efficiency and ensure prompt delivery, restaurants are adopting innovative solutions such as cloud kitchens and real-time updates, which help streamline the delivery process and improve the overall customer experience.
Food Delivery Market Share Worldwide
The global food delivery market is experiencing substantial growth, driven by the proliferation of food delivery applications and increasing demand for convenience.
The online food delivery market in the United States has hit a whopping value of US$231.30 in 2023 and is set to soar even higher, reaching close to the impressive US$384.70bn by 2027, with the online grocery and meal delivery segments showing no signs of slowing down as they continue their upward trajectory in the country.
Europe is expected to see its online meal delivery industry reach a value of $175 billion by the end of 2023. The three most popular platforms in the region are Just Eat, Deliveroo, and Instacart, capturing significant market shares.
China, the largest online meal delivery market, is projected to achieve sales of approximately $354.10 billion by 2023. Meanwhile, in India, the food delivery sector is anticipated to reach a total worth of $12.5 billion by the same year, with Zomato and Swiggy dominating the market.
Ensuring the safety and hygiene of delivered meals has become a paramount concern for the meal delivery industry. Consequently, several companies have implemented new regulations to safeguard the well-being of their customers and delivery personnel. This demonstrates their commitment to maintaining high health and safety standards throughout food delivery.
Mobile App Dining
The proliferation of food delivery services has transformed the experience of dining at home, making it more akin to dining out.
The online food ordering sector has experienced remarkable growth, surpassing dine-in sales by 300% since 2014. Currently, it constitutes approximately 40% of total restaurant sales. Moreover, the industry maintained a consistent annual growth rate of 10-15% even before the pandemic. This trend highlights the growing popularity and acceptance of these apps as a convenient and efficient way to order meals.
When it comes to placing delivery orders, an overwhelming 80% of Americans prefer to do so online. This preference for online ordering demonstrates food delivery apps’ convenience and ease of use. Furthermore, customers appreciate the utilization of cloud technology, which enables them to streamline preparations and receive real-time information, enhancing their overall experience.
Revenue from Food Delivery Apps
Meal delivery apps have become a favorite among customers while proving lucrative for business owners. According to Grand View Research, the meal delivery industry in the United States is projected to generate a staggering USD 64.27 billion in sales.
The income streams for these apps primarily stem from restaurant commissions, customer delivery costs, and advertising. In recent years, food delivery app development companies have diversified their offerings, expanding beyond restaurant delivery to include prepared meals, groceries, and more. This strategic shift has resulted in increased profitability for several businesses operating in this space.
Food technology advancements have played a crucial role in simplifying operations and facilitating the growth of these enterprises. This technological innovation has made it easier for food delivery app businesses to thrive and expand their services.
UK Food Delivery Market
Based on a recent report by Statista, the online food delivery market in the UK reached an impressive $4869 million in 2019. The market is projected to grow steadily by 8% by 2023. The online food delivery market is revolutionizing the UK’s local food industry, as many meal companies and restaurant owners are embracing online platforms to enhance their sales. Notably, during the pandemic, JustEat, a prominent food delivery app, witnessed a significant surge in app installations, showcasing its popularity among consumers.
The Effects of Covid-19
The COVID-19 pandemic significantly impacted the global demand for on-demand food delivery apps. Local eateries faced closures and restrictions, so consumers increasingly turned to takeaway and delivery services to access their favorite meals.
The UK Food Service Delivery Market Report reveals a notable surge in the food delivery market, with a remarkable 48.1% increase in 2020. To adapt to the changing landscape, more restaurants and cafés have partnered with on-demand service mobile applications to expand their customer base. The pandemic accelerated technology adoption in the food delivery industry, prompting businesses to leverage these platforms to reach a wider audience.
In the wake of the health crisis, consumers have become more conscious of cleanliness and hygiene. They prioritize convenient delivery methods that minimize the need for physical contact and reduce the reliance on hand-to-hand transactions. This shift in consumer behavior highlights the importance of offering safe and convenient delivery options in the evolving landscape of the food delivery industry.
Europe’s Food Delivery App Industry Overview
Europe’s food delivery app industry has experienced rapid growth, following a similar trajectory to that observed in the United States. According to Statista, the European meal delivery app market is projected to surpass $176 billion in 2027.
Several factors have contributed to this expansion, including the widespread adoption of mobile devices, heightened customer expectations for seamless and instant service, and the impact of the COVID-19 pandemic, which has led to increased reliance on delivery services due to stay-at-home measures.
Leading the European food delivery market are prominent players such as Deliveroo, Just Eat Takeaway, Uber Eats, Glovo, and Wolt. These apps have established significant market shares by offering customers various culinary choices, user-friendly interfaces, and reliable and timely delivery services.
To enhance the customer experience and streamline operations, these companies have leveraged cutting-edge technologies such as artificial intelligence (AI) and machine learning (ML). These advancements enable improved efficiency, personalized recommendations, and optimized logistics, ultimately delivering a seamless and satisfying experience to app users throughout Europe.
European Food Delivery App Industry’s Challenges & Opportunities
The European food delivery app business is witnessing a rising focus on eco-friendliness and sustainability as a prominent trend. In response, several companies have taken steps to address environmental concerns.
Some businesses have introduced eco-friendly packaging alternatives, while others, like Just Eat Takeaway and InstaShop, have embraced the use of electric vehicles- motorcycles and scooters for their delivery operations.
However, the industry also faces various challenges that must be addressed. One significant obstacle is the fierce competition within the market, which intensifies with the continuous entry of new players.
Companies have also faced scrutiny regarding their treatment of delivery drivers and reliance on gig economy employees. These concerns have sparked discussions about fair employment practices and the need for adequate worker protection.
As the European food delivery app sector evolves, companies must navigate these challenges by fostering healthy competition, addressing labor issues, and finding innovative ways to maintain their commitment to sustainability and environmental responsibility.
Covid-19 Effects on Europe’s Food Delivery App Industry
The COVID-19 pandemic has significantly impacted the food delivery app industry in Europe. With the closure or limited operations of many eateries, individuals have increasingly turned to food delivery services as a convenient option. Research conducted by McKinsey & Company indicates that the pandemic has spurred the development of food delivery applications, resulting in a substantial increase of 20-30% in order volumes.
Furthermore, the crisis has brought about a shift in consumer behavior. Customers now prioritize contactless delivery options and have preferred preparing healthier meals at home. Top food delivery apps have introduced innovative features and functionalities to respond to these changing needs. These include meal packages that offer curated food options and recipe recommendations to inspire and assist customers in creating their own meals.
The food delivery app industry has adapted to the evolving demands of consumers during the pandemic, providing them with convenient and tailored solutions to meet their changing preferences and circumstances.
UAE’s Current Food Delivery App Industry Overview
In recent years, Dubai’s food delivery app industry has experienced remarkable growth, with projections indicating that it will reach a market value of approximately $2 billion by 2023. This expansion can be attributed to customers’ increasing demand for convenience, seeking the ability to place orders with just a few clicks or taps.
Leading apps such as Talabat, Deliveroo, and Zomato have gained immense popularity in the United Arab Emirates, transforming the meal delivery landscape. These platforms have revolutionized how individuals enjoy their favorite foods by offering the convenience of ordering from the comfort of their homes. Moreover, they provide users access to a vast range of culinary choices, encompassing local and international cuisines.
The food delivery apps in Dubai have met customers’ expectations for convenience and created a diverse and immersive dining experience. With their wide selection of cuisines and seamless ordering processes, these apps have significantly impacted the meal delivery sector, catering to consumers’ evolving preferences and demands in the bustling city of Dubai.
Why Food Delivery Apps are Popular in UAE?
The popularity of food delivery apps in the UAE can be attributed to several key factors:
- Convenience: Food delivery apps offer unparalleled convenience, allowing customers to order their favorite meals from the comfort of their homes. With just a few clicks on their smartphones, customers can have their desired dishes delivered to their doorstep, eliminating the need to go out or wait in long queues.
- Culinary Variety: These apps provide many cuisines and dining options. Customers can explore a wide range of local and international flavors, allowing them to expand their culinary horizons and try new dishes they may not have access to otherwise.
- Time-Saving: Food delivery apps save customers valuable time. They eliminate the need to travel to a restaurant, wait for a table, or spend time cooking at home. With meal delivery apps, customers can enjoy their favorite meals without the hassle of preparation or long waiting times.
- Safety and Convenience during the Pandemic: The ongoing pandemic has further increased the popularity of food delivery apps. With concerns about health and safety, these apps provide a safe way for consumers to indulge in their favorite cuisines without compromising their well-being. The contactless delivery options offered by these apps ensure a safer dining experience.
India’s Food Delivery App Industry Overview
The Indian meal delivery market has experienced remarkable growth in recent years, thanks to the widespread adoption of food delivery applications.
These apps have revolutionized how people order and receive meals, offering unparalleled convenience and accessibility. With just a few taps on their smartphones, customers can browse through a wide range of restaurants and cuisines, place their orders, and have their meals delivered right to their doorsteps.
The competition between Swiggy and Zomato, two prominent players in the market, has been fierce. Both companies continuously introduce innovative features and services to attract customers and gain a larger market share. The recent merger of Uber Eats with Zomato further illustrates the intensity of competition and the quest for dominance in this lucrative industry.
The future looks promising for the Indian meal delivery app industry. Market projections indicate substantial growth, with an estimated $34.68 billion in revenue by 2023. This growth can be attributed to various factors, including the rapid rise of online food ordering, the widespread appeal of doorstep delivery, and the ongoing urbanization trend in India.
As more people embrace the convenience and benefits of meal delivery apps, the industry is expected to continue its upward trajectory, catering to consumers’ evolving needs and preferences across the country.
India’s Food Delivery App Industry Challenges
The Indian meal delivery app industry faces challenges impacting the operations and profitability of companies like Swiggy and Zomato.
Intense competition between Swiggy and Zomato is a major hurdle for both companies. They resort to aggressive marketing strategies to attract and retain customers, including offering significant discounts and incentives. While this helps in customer acquisition, it puts pressure on earnings and narrows profit margins.
The regulatory environment in India also poses challenges for food delivery apps. The government has implemented various regulations to ensure food quality and safety and protect individual restaurant owners’ interests. While these regulations are necessary for consumer protection, they can create operational complexities and increase compliance costs for food delivery platforms. Adhering to these regulations becomes a crucial aspect of their operations, adding to their overall challenges.
Navigating these difficulties requires continuous adaptation and innovation by food delivery app companies. They need to balance competitive pricing, profitability, and compliance with regulatory requirements to sustain their operations and meet the expectations of both customers and the government.
Despite these challenges, the Indian meal delivery app industry thrives due to the growing demand for convenience and the increasing adoption of digital platforms. Companies in this sector will need to find effective solutions to address these difficulties and leverage opportunities for growth in the evolving Indian market.
Key Players in the Online Food Delivery Market
The online food delivery market is highly competitive, with several key players dominating the industry worldwide. Some of the top players in the online food delivery market include:
DoorDash is one of the largest and fastest-growing food delivery platforms in the United States. It offers a wide range of restaurant options and operates in over 4,000 cities across North America.
2. Uber Eats
Uber Eats is a subsidiary of Uber, the renowned ride-hailing company. It has a significant presence in many countries and leverages Uber’s extensive driver network to provide food delivery services.
Grubhub is a leading online food delivery platform in the United States, connecting diners with local restaurants. It offers a user-friendly interface and a vast selection of cuisines to choose from.
5. Just Eat Takeaway
Just Eat Takeaway is a prominent player in the European food delivery market. It operates in multiple countries and partners with various restaurants to offer diverse dining options.
Deliveroo is a well-known food delivery platform in various countries across Europe, Asia, and the Middle East. It focuses on providing quick and efficient delivery services from popular local restaurants.
Zomato is an Indian-based food delivery platform that has expanded its operations globally. It offers restaurant listings, online ordering, and delivery services in many cities worldwide.
Swiggy is another major player in the Indian food delivery market. It operates in numerous cities across India and has gained popularity for its extensive restaurant network and efficient delivery service.
These companies continuously compete to attract customers, expand their restaurant partnerships, and improve their delivery logistics to maintain their market share and stay ahead in the online food delivery industry.
The on-demand food delivery app market is witnessing significant growth and transformation, driven by the increasing demand for convenient and efficient food delivery services. The convenience of ordering meals online, coupled with the wide variety of cuisines and seamless delivery experiences, has fueled the popularity of these apps among consumers.
However, the market is not without its challenges. Intense competition among key players, regulatory complexities, and profitability concerns are some of the hurdles faced by companies in the food delivery industry. Nevertheless, the industry continues to evolve, with technological innovations, improved customer experiences, and sustainable practices shaping its future.
Looking to develop your own food delivery application? Scrum Digital is a leading technology partner specializing in developing food delivery applications. Contact us today to leverage our expertise and create a seamless and customized solution for your business.