How Food Delivery Apps Are Winning Customer Loyalty – nitronet


Amid an influx of online orders amid the pandemic, food delivery services are booming. The industry’s top competitors are fighting for the attention of customers, and have begun to utilize acquisitions, promotions and diversified services to combine forces and carve out larger portions of the market.

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The past few months have been boom times for all of the major players: DoorDash, GrubHub (recently acquired by Just Eat Takeaway) and Uber Eats, which just acquired Postmates. According to studies from InMobi Marketing Cloud, 17% of Americans—and 28% of millennials—increased their food takeout and delivery ordering between February and May.

Breaking it down by the four titans:

  • DoorDash app installs rose by 53% in February, followed by a 29% rise in the first three weeks of March. The brand then had a dramatic spike in sales in mid-to-late March.
  • GrubHub app installs rose by 54% in February, and 29% in the first three weeks of March.
  • Uber Eats app installs rose by 30% in the first three weeks of March.
  • Postmates app installs rose by 64% in February and 39% in the first three weeks of March.

Third-Party Food Delivery Trends from InMobi Marketing Cloud

Why did some apps do better than others?

When the pandemic hit, Uber Eats and GrubHub sheltered in place with the rest of America, and didn’t engage much in advertising, while Postmates and DoorDash took a different approach.

Postmates’ delivery services already went beyond just restaurants, also offering groceries, alcohol and office supplies. Families didn’t want to leave their homes to shop, so Postmates pushed this angle, and when it supplemented its offering with contactless delivery in mid-March, app installs jumped significantly.

Greg Archibald, senior vice president of media at InMobi North America, believes this success, coupled with the brand’s ability to offer diversified products, placed it in a much more favorable position to be acquired by Uber Eats.

The food delivery space operates on razor-thin margins,” he said. “The ability to use acquisitions as a way to drive operational efficiency just makes sense, and this allows Uber Eats to break into new demographics and geographies.” 

DoorDash also stepped up quickly after the pandemic hit, launching its “Open for Delivery” campaign in mid-to-late March to encourage customers to support their local restaurants, and led to an incredible spike in delivery orders through the app.

Jeremy Huber, head of audience intelligence North America for InMobi, said that campaign was key to the brand’s success.

“DoorDash was always ahead of the competition,” Huber said. “But once this campaign launched, we’ve seen the brand extend its lead over others in the space day-over-day, month-over-month.”

What’s next for food delivery services?

InMobi has reported a 5% rise month-over-month in the general population ordering groceries and food delivery online since the pandemic began. While this growth has recently begun to level off, Huber doesn’t see it dropping down anytime soon, especially as Covid-19 infection rates continue to rise in some parts of the country, with the potential for a second wave in recovering areas, as well as cold and flu season.

“Now there’s a playbook,” Huber pointed out. “When the pandemic originally hit, nobody, brands or consumers, knew what to do. Now there’s more comfort using delivery services.”

This comfort aligns with findings from the World Health Organization that there is no evidence of food packaging spreading Covid-19.

Archibald believes comfort in ordering through food delivery apps will stick.

“This time has made people shift in ways that are going to change how the space operates forever,” he saud. “Ordering food online has become a habit for consumers, and it isn’t leaving.”

Brands will also be able to operate better during future crises based on what they’ve learned over the past few months. “The companies that did nothing learned from the success of DoorDash and Postmates,” Huber said.

How will brands continue to distinguish themselves?

Archibald doubts consumers will ever be exclusively loyal to one food delivery service, especially since many offer the same products from the same restaurants. The key is offering the best deals and services to keep users coming back.

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