The Online Foodservice Consumer - US - August 2016

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