The On-Demand Delivery Trends and the Technology Driving Them

The future of on-demand ordering could be summed up to one simple statement– It’s just beginning.

According to Foodable Labs, over 30% of the U.S. Restaurant industry is offering some kind of on-demand third-party ordering solution. Over 80% of consumers under the age of 35 are using on-demand food ordering apps about two times a week, proving the delivery segment has exploded thanks to the new age consumer and their dining habits.

The Big 6 are the lion's share of the market, but our research now shows over 100 on-demand food delivery companies serving the 1.2MM restaurant and food companies in the US.

The breakdown of Engagement and Sentiment tells an underlying story of these companies and how consumers view them and eventually, how restaurant operators may view them as well.

Engagement is scored by an analysis of how often consumers mention the use of the app or service on social along with an analysis of the Sentiment of the service based on food delivery speed, quality, accuracy.

The Engagement and Sentiment Scores of the Leading Third-Party Delivery Companies

According to this data, the Best Quality goes to the company Caviar. As the leader in the Sentiment area of Quality, this may be based on great service, but the company also recently acquired by Square. Remember Square is also a POS company and is tied to transaction-based business models. Recently Caviar added a spotlight that says "who's making your food" and has labels like women-owned restaurants. The overwhelming support by their users has given their consumer Sentiment score a boost.

Best Accuracy: Caviar came through as the leader in this area as well with a unique Sentiment score that showed this as one of the most appreciated aspects of its user base. Caviar's, along with other delivery apps', performance is being measured by the Chicago-based delivery search engine Food Boss, which is being led by the former McDonald's CEO Don Thompson.

Best Speed: Uber Eats takes this slot with what was one of the best Sentiment scores based on the overall app Sentiment. This has little to do with the ordering process and making a restaurant selection, which for most users ties into the overall speed of the order. As they continue to use their technology to analyze user behavior, Uber continues to have the upper hand when it comes to speed that other companies may not be able to pace.

I had a chance to explore one of the technology companies that has created a solution to centralize the on-demand challenge of being listed on multiple platforms mainly for discovery.

Ordermark has created a solution to centralize the in-store technology to create a more seamless integration into food operations which over time has become one of the most challenging aspects of the on-demand food ordering explosion.

Every restaurant operator understands discovery is the key to success and the solution in today’s world is not Facebook or Twitter, instead, it's being on as many on-demand platforms that you can handle. Alex Canter, CEO and founder of Ordermark and I discuss the growth aspects of the company and the delivery sector, as well as technology and operational challenges of the future of on-demand food ordering and where it might be heading.

Foodable's 2019 Predictions for the Restaurant Industry

Predictions are always a love-hate thing for me each year, it means I have to look deep into the industry and into my past 20+ years of reporting, indexing and analyzing with the leading foodservice operators in the world. Sometimes this analysis reveals the good times to come for the industry and sometimes it does not.

Last year, six out of eight of my predictions were right, most of which were easy to consider, but if you think about the timing in 2017 to detect these market shifts you have to be somewhat of a fortune teller and very lucky to get these right.

I was right on with plant-based menu items taking off, coffee trends ramping up infusions and even the beverage industry taking a hit in spirits, wine, and beer, the most troubling was the 8 percent overall drop in the industry prediction that turned out to be pretty accurate at 7.8 percent, according to our Foodable Labs data.  

2017 was not a great year for many, but the few emerging brands that excel did so in double-digit fashion.  

Unfortunately, I don't think this can continue. The bigger concern I have for 2019 is the overall health of our industry. Closings will continue like always but we will see some closures of brands we may have thought to be bulletproof just a few years ago.

Without further ado, let’s move on to my 2019 Predictions

Check the video above for more of my commentary on these predictions, but this will give a quick read on where I think the restaurant industry is going in 2019.

Plant-based is on a maverick of a wave that I don't see slowing down anytime soon, in fact, my recommendation to any protein producer is diversification and to double down on quality and animal welfare.

Facebook is in real trouble with the foodservice and foodie crowd with continued falling engagement levels to that of 2014. I don't see this turning around for the platform at all and the move to Instagram ads and destroying that platform may be their only hope before the feds scoop in with regulation.

I fear the ultimate breach will occur with foodservice, If I were Starbucks, I would Fort Knox that mobile app before we see a big hit on what could affect as many as 1 billion consumers. Big tech will continue to get pushback from consumers and though 2019 won't be the year for deregulation 2020 will be a campaign trail mantra for sure.

Airbnb, Amazon, and Uber will all reach a new level of innovation in food, and not in the ways you might think.

Amazon will take a new role as a ghost restaurant operator, Airbnb will take up restaurant reservations, and Uber will have to go head to head with the industry to win out in the delivery game

The emerging 150 brands will continue their trek on obliviating the competition. Watch out for a few of them that will dominate in the regional game like never before.

And unfortunately, the small craft beer makers will start to fall with a downturn in drinking trends and craft beer consumption falling. We will instead see a new landscape of how craft brewers will go to market, let the brew mergers begin.

Like every year, some of my predictions are outside the box and thinking in ways that others don't. What I have found is that if you follow consumer science, technology, and food you have some insights to a crossover matrix that starts to provide early indicators to trends that go unnoticed even in today's always on social media barrage of information.

If you're in the business, this will either be your best or worst year in the last decade. Think of it like this– to quote one of my favorite sayings by Louis Pasteur, “Chance favors the prepared mind” see ya on the backside.