Are restaurants ready to build their own mobile app ecosystem?
If you’re working in third-party food delivery for a while, you may have noticed a time when you arrived at the restaurant and got a cold shoulder. Chefs acted like you’re harassing them, while wait staff acted like you’re stealing their tips.
In the past, they might have been right. Restaurant capacity limits patrons, but delivery orders can easily exceed that capacity, stretching the chef’s time and food stock. And waitstaff only infrequently gets rewarded for the time they wrap up items for delivery.
No wonder they’d stare daggers at you.
But with the advent of COVID-19, everything has changed. Suddenly, with no dine-in patrons, restaurants have grasped the lifeline of third-party delivery like drowning sailors. Rather than thinking it’s taking the food out of their mouths, restaurants have found that third-party delivery has saved their bacon.
A recent study by analytics company Service Management Group (SMG) has determined the symbiosis of restaurants and third-party delivery goes deeper than previously imagined. Among the insights in the third edition of its Third-party Delivery Report, for example, were that
● Users’ chose an app that carried their favorite restaurant.
● Users’ of third-party delivery apps tended to go to restaurants more often.
● Three out of four customers said that restaurants not listed on their apps ran the risk of losing their business.
With the entire industry pivoting toward food service delivery for the foreseeable future, you might think that the larger restaurant corporations might be considering offering their own delivery apps to the public. In fact, one restaurant franchise, Domino’s, has been doing it for years. Since its first app launched in 2014, the pizza brand has deployed voice recognition and pizza emojis for deeper market share.
Surprisingly, the idea of owning delivery has yet to catch on with large restaurant corporations. While there have been some noises to that effect, most still prefer to partner with established third-party delivery apps like DoorDash and Uber Eats. Even so, some smaller, regional food franchises, like California-based Panda Express, are starting to develop their apps.
For car sharers, this means their relationships with third-party apps won’t be changing any time soon. The big apps will continue to have the most market share, and to call the shots for customers and drivers alike.
In the future, more fish may enter the delivery pond as restaurants test the waters with proprietary apps. If and when they do, will their presence dilute the third-party delivery market? Maybe elsewhere, but not in a town like New York, which has about 25,000 restaurants and bars.
Another reason to love the Big Apple.
Author: Kyle Freedman is a partner at Tower Auto Mall focused on building a rental platform for delivery and rideshare drivers in NYC and its metropolitan area (non-TLC rentals). He has brought insight and know-how from his background in marketing and technology to help facilitate low cost, long term vehicles solutions for drivers with bruised or virtually no credit.