The largest food delivery apps today share most of their customers. For instance, 73% of Grubhub’s customers didn’t use other meal delivery services in the second quarter of 2018. Today, that number has fallen to 45%. Why is this?
Generally speaking, most food delivery apps offer the same or similar restaurants - meaning little room for differentiation. DoorDash, GrubHub and UberEats all offer around 300,000 restaurants to choose from, making it nearly impossible to stand out and be the app of choice. So, how do food delivery apps get that edge and build consumer loyalty? Let’s take a look at some tips.
Be the first app on the device
Pride of place is vital for consumer loyalty - 95% of users install the majority of their apps in the first 48 hours of owning a device. Considering the high competition among food delivery apps, being one of the first installs is key to maintaining a long-term relationship with users.
Additionally, 54% of food delivery app users start with a restaurant in mind and then go to the app to order rather than the other way around. Seeing that most apps offer the same restaurants, being the first app install will encourage users to go to your app, first, to find the restaurant. Further, apps downloaded in the first few hours of owning a device are likely to have a higher LTV, since users intend and expect to use the app eventually.
The only way to ensure your app is being placed in front of users the first time they open their device is by partnering with OEMs and carriers, or a service that handles that relationship - like ironSource’s Aura. Aura places apps in front of millions of users every day at prime moments when they’re setting up their new device. Aura also gives app advertisers access to campaign performance to track the success of the partnership.
Shift to a subscription model
Once you’ve taken pride of place on the user’s device, the next step is retaining these users with benefits and perks to keep them coming back - essentially rewarding them in some way or another. In a recent survey, 61% of respondents said that the most important way to interact with users is to surprise and reward them for being a good customer. If you want the users that you worked so hard to acquire to be exclusive to your app, try offering meaning and value through subscriptions or other methods of rewards.
Subscription models, for example, get rid of per-delivery fees that offer users competitive pricing options to keep them loyal to the service. Within the subscription model, you can offer customers special services, discounts, or exclusive opportunities that help in getting a rapid ROI. Postmates was the first food delivery app to offer a subscription model in 2016. Just this June, 16% of Postmates users subscribed to Postmates Unlimited, and that number is expected to grow.
You can also consider partnering with rewards programs, such as Chase Sapphire, which granted their users one year of free subscriptions to DoorDash.
Build exclusive partnerships
While the above tips will undoubtedly build loyalty, at the end of the day, people are going to eat what they want to eat and not every food delivery app will offer every restaurant. It’s important to partner with as many big food chains as you can. Big chain restaurants, diners, and coffee shops have huge customer pools, countless numbers of locations, and impressive advertising reach. This is especially vital since most QSRs are new to the digital world and UA, and will likely want to build partnerships.
For instance, Starbucks has 16 million active loyal users - more than any one food delivery app could imagine. Partnering with moguls such as Starbucks, which is what Uber Eats has done, will carry those loyal customers over to your platform. It is also possible to share restaurant partnerships with other apps. Food delivery apps need to be on the lookout for ways to retain loyal customers - the key to app performance. In an industry expected to hit $16.6 billion by 2023, one can expect new players, impeccable innovation, and unprecedented growth in the next few years. Be prepared and build your user base now with these tips.