Sponsored by Sterno Products
For many consumers, the hottest table in town is at home. The growing popularity of home delivery and takeout, coupled with the rise of convenient online ordering platforms and third-party delivery providers, is opening a significant new revenue stream for restaurateurs in a variety of concepts and segments.
“Consumer demand for online delivery is growing rapidly," says John Glass, U.S. restaurant analyst for Morgan Stanley Research, in a recent survey.
The survey found that in the first six months of 2017, 47 percent of consumers ordered food for delivery compared to 44 percent in the same period last year. The share of delivery orders placed online through a delivery service website or app increased to 18 percent this year from 15 percent last year. And 43 percent of those consumers using food delivery this year say their order replaced a meal at a restaurant, up from 38 percent in 2016, suggesting cannibalization of dine-in meals, says Morgan Stanley.
“Many restaurants right now are seeing a slowdown of in-store dining,” says Laura Calder, senior product marketing manager for Sterno Products. “Delivery provides revenues to counter that.”
Delivery for the Digital Age
When the market research firm Datassential surveyed delivery consumers recently, it found that the majority — 79 percent — placed their delivery orders by phone. However, 63 percent ordered with websites and 38 percent with mobile apps. Although only 11 percent of consumers ordered by text message and 8 percent via social media platforms, those who use the latter methods show a strong preference for them.
Not Just QSRs
Quick-service chains, notably pizza players, were the early role models for delivery and still have the highest market share of orders — 39 percent — according to Datassential. But operators in other segments and channels compete in delivery now as well: fast-casual (17 percent), casual dining (16 percent), midscale restaurants (9 percent), grocery stores (8 percent), upper casual restaurants (6 percent) and convenience stores (5 percent).
Bigtime Players in the Game
The list of chain restaurant brands growing delivery is a who’s who in the industry. For example, McDonald’s Corp. announced this summer that its McDelivery program has expanded to 3,500 U.S. restaurants, with UberEats as its leading delivery partner. And with the majority of people in McDonald’s top markets located within a short distance of its restaurants, the burger giant is well situated to meet delivery demand.
In May, Spartanburg, S.C.-based Denny’s launched its Denny’s On Demand delivery program to bring America’s Diner favorites to consumers 24/7. In addition to teaming up with Olo, a digital ordering provider, Denny’s offers online ordering through Twitter and on Facebook with a branded chatbot.
Front-of-the-house seating is a thing of the past in the new crop of “ghost,” or off-premise-only, restaurants. An example is Seaside’s, a delivery/takeout-only concept that offers fried chicken, ribs and lobster from the kitchen of Oyster Bah, a Lettuce Entertain You Enterprises eatery in Chicago. Seaside’s delivery/takeout-only menu expands the sales of the 81-seat Oyster Bah by 10 to 15 percent without additional occupancy expense, LEYE says.
Another LEYE restaurant in Chicago, the fast-casual Wow Bao concept, has moved to the West Coast for the first time with a new Los Angeles location that offers delivery exclusively. The L.A. outpost partners with third-party delivery services like UberEats, Door Dash and GrubHub to tote its steamed buns, pot stickers and dumplings around town.
Protecting the Restaurant Brand
No matter the cuisine, food-carrying equipment that keeps hot food hot and cold food cold is a must for safe, high-quality food delivery. The reasons are clear: “When you do delivery, you lose some control over the brand,” says Sterno's Calder. “You may be relying on a third-party delivery service. Traffic may delay the delivery. You may have to deal with extremely hot or cold weather.”
Sterno Delivery addresses those issues with a line of Insulated Food Carriers made with dense, multilayered foam for proper insulation. The line ranges from compact insulated bags for sandwiches to large insulated carriers for full-sized catering pans, pizzas and stadium vending fare.
All Sterno Insulated Food Carriers are designed with seamless tear-resistant liners, which eliminate seams or holes that can cause spilled sauces or liquids to build up in the insulation foam and cause odors and mold. What’s more, the seamless design makes for easy cleanup.
Bottom line, if the food quality is poor, the customer will blame the restaurant. But high-performing food carriers give operators confidence that their delivery food will arrive at the consumer’s home as it should. As Calder sums it up, “It all comes back to protecting the brand.”