The Big Potential of Food Delivery

Ten years ago, the restaurant delivery landscape looked a little different. On the consumer end, it was a matter of sifting through your messy drawer of take-out menus, calling in your order (which meant actual human interaction), rattling off your name and address to a curmudgeonly employee and then digging though your wallet to come up with the right change (and tip) when the delivery guy rings your doorbell. On the restaurant end, it was a dizzying balancing act of taking orders and preparing to-go items while simultaneously trying to manage the busy dining-in crowd.

But then, in 2007, a simple idea took the entire industry by storm—an online restaurant delivery service named GrubHub, and it brought with it the hope of higher outputs, higher revenue streams and less headaches for small and large businesses alike. According to GrubHub’s economic impact study, restaurants saw a six-times greater monthly revenue growth than restaurants not on the platform. And for consumers, it meant less steps between the moment a food craving hits and salvation from hunger pangs. Nearly 10 years later, GrubHub has paved the way in a very lucrative niche. Today, U.S. consumers spend nearly $3.5 billion on delivery food.

Whether a restaurant decides to partner up with virtual food courts like GrubHub or develop their own mobile delivery platform, one thing is clear--customers crave convenience, speed and ease when it comes to getting their hands on their next meal. In fact, 61 percent of Millennials said that the availability of takeout and delivery is one of the most important factors when choosing where to get their grub. And as a result, more and more restaurants are realizing the big potential to grow their revenue streams by adding or enhancing the technology behind their delivery services to make food to-go faster and easier than ever before.

“Customers just assume that they can order their meals online these days. It’s rare that people will pick up the phone or drop by the store to place their takeout or delivery orders. So now, more restaurants are rushing to make their delivery process as seamless as possible—that’s good news for customers and for these restaurants,” said Amir Eisenstein, chief marketing officer for Eat 24.

But beyond its convenience value, Eisenstein believes that there’s a hidden psychology behind online ordering, too. Customers are more likely to place bigger—and more expensive—orders, which means an additional source of revenue that wouldn’t have otherwise existed before the boom of app-based ordering. This is often referred to as the “add-on effect.”

“If you order a pizza over the phone, you’ll tell them to bring an XL pizza and a Coke. But when you go online, you’re exposed to the entire menu. All of a sudden, people order appetizers, ribs, salads and other stuff they don’t normally order over the phone. They have more time to peruse the menu, and as a result, they end up ordering slightly more,” Eisenstein added.

In 2015, Toppers Pizza* introduced a new and improved toppers.com, and it was re-launched as an e-commerce site. Enhancements were made to simplify the online ordering process, and a new responsive design allowed customers to have a pizza delivered to their door with the touch of a button on their smartphones. Since the new website was unveiled in August 2015, Toppers has already seen a noticeable spike in traffic, with nearly 40 percent of system-wide orders now being placed online—a 33 percent jump from 2014.

Delivery in the pizza industry is nothing new. In recent years, Domino’s Pizza has gotten noticeably good at something that wasn’t always its focus—developing technology products to get pizzas to people more easily. Domino’s made its online ordering simple, for instance, by letting customers save an “easy order” that they can get in just a few clicks. And there’s the Domino’s Tracker—a progress bar that updates customers on their pizza order in real time.

But Toppers believes they’ve introduced the perfect weapon to their arsenal—not only is their technology faster, better and more-efficient, but they’re delivering a higher-quality pizza at speeds equal to, if not faster, than a lot of the bigger chains. As state-of-the-art online ordering technology becomes a standard for an industry dominated by delivery, Toppers believed there was still an unmet need for people who wanted more than cheap, homogenous pizzas delivered to their door.

“We started out as a brand that wants to create better pizza while delivering it at the same speed as the other major national chains. We use fresh dough and have fresh ingredients—you’re not going to find that on the big chains’ menus. So when you’re scrolling through your food options online, what are you going to choose? Generic pizza or the innovative pizza?” said Scott Iversen, vice president of marketing for Toppers. “Today, to really succeed in your industry, you need the full package—quick-delivery, better technology and a high-quality product.”