Online food ordering has revolutionised the way takeaways and restaurants generate revenue. In the last few years, the industry has grown to an impressive 12 billion pound industry in the UK.
According to a report by the British Hospitality Association, the market will continue to grow at 11.5% until 2025 to around £20bn per year.
As a restaurant or takeaway owner, the key question is how to you position yourself in the coming years to make sure you get a maximum slice of this proverbial pie.
To understand the answer to this question, it's important to look at how we got here.
The Rise Of The Food Portal
The growth of online food ordering can be attributed to the rise of platforms such as Just Eat, Deliveroo, and Uber Eats. These apps were the first to capitalise on the trend of customers preferring to order food online. They based their success on the fact that most takeaways and restaurants couldn't afford to build their own apps or websites due to the high cost. In the early 2010s, it was common for a typical high street restaurant to not have the budget of £100,000 - £500,000 to create a top-notch online ordering system and invest in marketing. Joining a food portal became a much more cost-effective option.
At first, the adoption of these platforms was slow, but as more and more restaurants and takeaways joined, the pace picked up. The low commission fees initially offered by these platforms were attractive, and by being listed on them, businesses could tap into the growing market of online ordering. This was a win-win situation for both the platforms and the restaurants. It allowed the former to grow their user base and the latter to expand their reach sales.
Online Ordering Fees Get Expensive
Soon though food portals started increasing their fees upto and over 30% per order. At first, restaurants were able to absorb the increased commission fees imposed by the food portals, as during the COVID-19 pandemic, customers had limited options for ordering food and were willing to pay inflated prices for a break from home cooking.
But as restrictions began to ease and the cost of living crisis emerged, people had less disposable income and were less willing to pay high prices for online food delivery.
The food portals seemed like a great idea at first, but as the market became saturated and costs went up, we realised we needed a new solution." - Sarah, Owner of "Sushi Express
This left restaurants in a difficult position. They still needed to sell their food online, but couldn't afford the exorbitant costs imposed by the food portals. It became clear that an alternative solution was needed. Restaurants needed a new, lower cost way of selling their food online.
Going Own Brand
One solution was for a restaurant to invest in their own ordering platform. Many had already tried. But this first generation of own brands websites and apps often lacked quality and functionality. Many businesses mistakenly believed that simply having a website was enough, but in reality, it was not.
Additionally, many of the first generation of own-brand ordering providers delivered solutions with poor quality and user interfaces, making them difficult to use for customers.
If customers don't know the restaurant had its own ordering app and then if by some miracle they found it but it was hard to use, it's no wonder many discarded own brand apps as a solution to food portals
Time For The New Kids On The Block
A new generation of restaurant apps has emerged that addresses the quality issues and lack of marketing that plagued the first generation of own-brand apps. These new apps are built on the latest technologies and come with well-designed websites and mobile apps that include loyalty schemes and marketing.
The providers of these apps market the apps of their restaurant clients themselves, integrating them with search engines like Google and social media sites like Facebook.
"With our own ordering app, we were able to cut down on commission costs and reach more customers in our local area." - John, Owner of "Pizza Palace"
The result is a powerful combination. A well-designed, user-friendly ordering experience and a marketing plan that can reach thousands of customers in a restaurant's local area. This new approach to own-brand apps allows restaurants and takeaways to have their own app and website, get it in front of thousands of people in their local area, and offer a world-class ordering experience, all without the excessive commission costs, restrictions, and loss of customer data that come with food portals.
This new generation of restaurant apps is a game-changer for the industry. They provide restaurants with a cost-effective way to reach customers and increase sales, while also allowing them to retain control over their customer data. Most importantly they retain can recover thousands in lost profits, almost overnight.
The future of the online food delivery industry is trending towards the use of own-brand apps, as more and more restaurants and takeaways are realising the benefits of building their own online platform. Using the latest generation of apps provided by companies like Order Digital, they can market to their customers, take orders through any channel (web and mobile), provide loyalty programs to retain customers and grow their revenue.
“Having your own app is the key to unlocking the full potential of your restaurant business. With Order Digital, you can create a world-class ordering experience for your customers, increase your reach and revenue, and retain control over your customer data and branding. Don't let food portals hold you back, take control of your online presence and grow your business with Order Digital.”
The rise of these new generation of restaurant apps that are easy to use, affordable and effective, means that restaurants now have a viable alternative to food portals.
Instead of continuing to pay 30% commission to food portals, they can upgrade to a more modern, fully-advertising own-brand ordering solution and capitalise on this shift as customers seek to continue ordering, but reduce their costs.
And with companies like Order Digital, it's easy for restaurants to build their own platform and take their business to the next level.
So if you're looking to grow your restaurant business, consider upgrading to an own-brand ordering solution, and take advantage of this shift in the online food delivery industry.