Pre-pandemic, the shine was rapidly coming off big tech platforms with policymakers and consumers concerned about their power and influence. The COVID-19 crisis has led many to re-engage with social media and try out new services online. Some platforms have been deemed “essential and even potentially livesaving”.1 What a turnaround in a few short months.
Food delivery companies like Delivery Hero, Deliveroo and GrubHub have found new customers among those self-quarantining or under lockdown. According to a survey conducted by CGA, over half of the adult population in Great Britain either has or is planning to get food delivered during the COVID-19 pandemic.2 The accelerated adoption of new services is illustrated by the fact that food delivery has gained in popularity across all age groups.
As one might expect, 18- to 34-year-olds and 35- to 54-year-olds have increased their delivery frequency by 60% and 30% respectively since the outbreak of the pandemic. The really telling statistic is that one-tenth of over 55s have already increased their takeaway purchases, with one-third planning to order in more often.2
A second wave of older consumers has been pushed to try out these services as they adapt to their restricted circumstances. The task now for the delivery sector is to build retention and facilitate a long-term shift in consumer habits.
Grocery growth
Meal delivery is not the only sector enjoying a boost. The Wall Street Journal reports that online grocery sales have increased by about 90% between March and April. 52% of Americans say they have bought groceries online in the past year compared to half that a year earlier. As with takeaways, the key for investors is whether this is a short-lived phenomenon. The data says otherwise with 63% of Americans expecting to continue online grocery shopping over the coming year.
Once trust has been gained and the customer experiences the convenience, loyalty can be established. Kantar’s recent survey found that 60% of respondents from Germany, the UK and France are likely to continue to shop online to the same extent once the coronavirus has passed.3
Of course, the big players are no slouches and are pushing to increase their market share. Amazon’s new super-fast delivery “Ultra Fresh” will be coming to the UK soon. What large supermarket chains and platforms such as Amazon lack is that ability to provide a more intimate and specialist service for those who really care about the provenance of their food.