As the coronavirus pandemic eliminates foot traffic to the restaurant and retail sectors, many consumers are turning to delivery and take-out as their only remaining options. The questions on everyone's mind seem to be, "When will this be over?" and "Will things go back to normal?"
Our research suggests that many consumers who have switched to online ordering plan to continue that behavior after the pandemic ends. In other words, we may not see foot traffic visits return to their previous levels.
On April 2nd, Sense360 ran a survey examining the types of ordering channels people are using, like delivery and take-out, and what behaviors people expect to continue in the future.
60% of respondents of have utilized takeout or home delivery in some form since the pandemic started. Note that takeout here refers to order-ahead. About 20% of people in total have used both delivery and takeout during this time period. And about one in five have used only takeout or only delivery. The remaining 40% haven't used either and are relying solely on in-person visitation in order to purchase their items.
Restaurant takeout is the most popular off-premise ordering, followed by home delivery of restaurant and retail orders.
We also examined specific product categories – restaurant, grocery or retail - that people have ordered for delivery or pickup.
The most dominant activity is that people are ordering from restaurants for pickup, even more so than delivery or any other activity listed here. Of those who have used delivery or order-ahead pickup, over 40% of them have used it for more than one type of product or channel as well.
Grocery delivery has the highest percentage of first-time users.
Of the 9% of respondents who have used delivery in the past, about half of them have utilized it to get at least one new type of product that they haven't gotten via delivery beforehand.
The activity that people are switching to the most is grocery delivery: 41% of delivery users reported that they’ve used grocery delivery for the first time during the pandemic.
So even though restaurant ordering for home delivery may be the most dominant way that people are using delivery in total, it doesn't have the growth rate of first-time users that grocery delivery ordering does.
When we start thinking about forecasting behavior change, certainly this seems to be a trend to be watching much more closely than the delivery usage for restaurants, as more and more first-time users are experiencing grocery delivery due to coronavirus.
Delivery first-time adopters plan to sustain this behavior after the pandemic ends.
Of people who already use delivery, about 38% adopted a new behavior - ordering some new type of product (restaurant, grocery or retail) for delivery in the last few weeks compared to their normal historical behavior.
More importantly, over 60% of those people plan to do so again for that product category after the pandemic subsides. This indicates that more and more people are experiencing a behavior change that they expect to sustain. The same goes for take-out: 42% of previous take-out users have adopted a new behavior and ordered a new type of item via take-out, and 64% of those plan to sustain this behavior.
DoorDash was the most frequently cited way to order delivery, followed closely by a given brand's own website.
Diving deeper into delivery, we see that the single most common activity is restaurant delivery through DoorDash, with about 12% of total people having used it during the pandemic.
Coming in at a very close second is ordering directly from a brand's own website (this could be a restaurant first-party platform like Domino's own website, or it could be a retail delivery platform like Walmart's own website).
When focusing on grocery, about 5% of people report using Amazon Fresh or Amazon Prime Pantry, and about 3% of people report using Instacart for grocery delivery during COVID-19.
Value was the biggest determining factor when choosing between delivery platforms, followed by Convenience.
We asked consumers what factors have been most important in choosing one platform over another, and the most common responses center around value - for instance, low fees and free delivery.
The next most commonly cited reasons are around things like convenience or inertia – i.e., the app is already on that consumer's phone. Generally, it appears that if costs are equal, then consumers choose whatever channel is the simplest and most convenient way to order - either because the app is already downloaded, the payment details are saved, or the service is reliable and fast. Lastly, but still highly ranked, are factors like variety and quality of restaurants available on the delivery app.
Now is the time to capture market share
When the world emerges from the COVID-19 pandemic, we will be facing a dramatically different landscape in which clear winners will emerge, having captured market share during the downturn and likely keeping it in the future. Now is a critical time for brands to monitor what's working, pivot to consumers' needs, and continually optimize to ensure that they emerge with a larger, loyal customer base.
Given that the adoption of these off-premise options is likely here to stay, restaurants and retailers alike should act quickly to ensure they have operational and consumer-friendly off-premise options. If you can capture consumers during this era with new ordering/delivery options, it's likely you will retain their loyalty post-COVID-19.
If you are interested in receiving the raw data from all of our analyses, along with a custom COVID-19 Tracker with survey, foot traffic, and transaction data, please contact us. We understand that budgets are tight, so we are offering this solution at the lowest cost possible.