Restaurants and retailers have the potential to reach more customers than ever before, as food delivery services continue to rise in popularity. But to fully take advantage of growth opportunities, businesses can review industry and consumer data to understand what's truly driving the rise of food delivery services, and how to unlock new efficiencies and strategies.
Why online food delivery continues to grow in popularity
It's a new era for restaurants — one where guests are eager to splurge in the grocery and restaurant categories according to McKinsey — but that doesn't necessarily mean that they'll be dining out. Statista forecasts that the online food delivery market is slated for a compound annual growth rate of 9.49% from 2024 to 2029, expanding from a projected $1.22 trillion to $1.92 trillion globally.
These growth projections track with the latest data to come out of DoorDash's annual Restaurant & Alcohol Online Ordering Trends Report. In a survey of more than 1,500 US consumers, 70% of respondents had ordered food delivery in the past month, 33% said that they were ordering more delivery in 2024 compared to 2023, and 49% were placing repeat orders at least once a week.
So what's driving this trend? Food delivery services make everyday life easier for people with busy schedules and can also be hugely helpful for party hosts — 39% of diners said they had ordered delivery when hosting a social gathering at home.
Convenience is also appreciated when people find themselves in a bind, with 74% of consumers saying they recently used delivery when they needed food last-minute. Whether people are ordering in to simplify weeknight dinner plans or to treat themselves on the weekend — online food delivery remains a preferred option for consumers, and that trend appears to be here to stay.
"Delivery is a service that's become very much a part of people's lives. When I have to work late and my kids are home alone, they DoorDash. It solves a problem in society: how to get food if I don't have time to cook and I don't have time to go to a restaurant, but my kids still need to eat."
The current landscape of third-party delivery
For a growing number of consumers, the internet is the first place they look when deciding where they want to dine. And while Google reviews and social media help them make decisions, food delivery platforms are increasingly helping them discover new restaurants in their area. 67% of customers had recently ordered from a new business on DoorDash, suggesting an openness to discovering new dining options through the platform. For the majority (51%) of respondents, third-party apps are their favorite way to browse for food options.
Once consumers are on the apps, they make good use of them. Significantly, 86% of customers who utilize food delivery platforms are ordering on them at least twice per month — a slight increase over the previous year.
It's important to note that businesses of all sizes are benefiting from food delivery services — not just big players and popular chains. In fact, 56% of customers favor restaurants they frequent on a regular basis, which bodes well for beloved neighborhood hubs — and better yet, 33% of consumers actively look to buy from local restaurants that only have one location in the area.
Overall, restaurants are finding that third-party delivery apps are an effective way to engage and entice prospective diners. According to the same DoorDash survey, menu selection and menu pricing are the top two factors customers consider when choosing where to eat, and an online ordering platform enables businesses to easily put their wares in front of consumers.
How the Rosenberg's Bagels & Delicatessen grew profits with delivery
Of course, businesses know that third-party delivery services aren't all the same — something that Joshua Pollack, founder and owner of Denver-based Rosenberg's Bagels & Delicatessen, learned firsthand.
In the past, Pollack had tried utilizing a variety of third-party delivery services for his businesses, but due to integration issues and challenging fee structures, they didn't provide the value he was looking for. He took a break from third-party delivery to reassess his needs, and after hearing sales pitches from many platforms, he exclusively partnered with DoorDash.
Unlike other vendors, the DoorDash team had a unique and informed appreciation for his priorities as a business owner. "The downfall of a lot of sales pitches is that they like to talk revenue, but they don't talk about profits," says Pollack. "Sales don't mean anything if you don't make a margin on them."
With DoorDash, Pollack and his team could seamlessly launch a full suite of sophisticated digital tools and advanced analytics across all five of his restaurant locations. DoorDash Storefront allows for a commission-free online ordering website that's customized to the restaurant's brand, while marketing tools like Promotions and Sponsored Listings target customers with discounts and offers.
"The DoorDash team is great at walking you through marketing tools and identifying what works best in the market for building repeat business or attracting new customers. It gives us a toolbox to look at and analyze in real time where our marketing dollars should be spent."
The results speak volumes. In the second half of 2023, Pollack's restaurants generated $130,000 in average monthly sales on DoorDash Marketplace. Their DoorDash marketing campaigns garnered an average return on ad spend (ROAS) of 8.7X. Today, DoorDash accounts for about 40% of their overall orders across all locations.
"A lot of our DoorDash orders are either new customers or people who order more frequently because of our placement on the app," says Pollack. "That's really exciting to me, because here we have an opportunity to work with a tech company that can give me visibility."
The future of the food delivery market
As Pollack and other restaurateurs have noted, consumers are evaluating businesses and making more of their purchasing decisions online. It may start with search engines, online reviews, and social channels, but food delivery platforms are proving to be a valuable vehicle for online exposure.
This visibility is one of the main benefits of partnering with a preferred third-party food delivery platform — and DoorDash is the #1 leader in category share for US food delivery. But another major advantage is that it takes the logistical burdens of coordinating drivers off your plate. It also provides customer data that you can analyze for trends and patterns to inform your menu and marketing strategies.
In the present and in the future, restaurants will be focused on strengthening customer relationships with loyalty programs, special promotions, and personalized offers — all areas that are powerfully supported by partnering with a third-party technology platform. Seamless online experiences keep customers coming back, while tapping into the customer base of a market-leading app like DoorDash can help restaurants reach new diners in their neighborhood.
The massive rise of delivery services points to one key thing: the future of food delivery is bright. As customers require greater convenience in their daily lives, the demand for delivered food — as well as flowers, groceries, and alcohol — will only continue to grow.
Ready to grow your business with a third-party food delivery platform? Sign up for DoorDash and maximize your food delivery service with minimal effort. Browse the Product Guide for Merchants to learn more about DoorDash products and services to grow your sales and reach more customers.
