Food Delivery Apps Need To Pursue Customer Engagement

Erica Vialardi

Food delivery apps are becoming a very competitive battleground in the digital economy. Similar to participants on reality television cooking shows, online food delivery providers are going to great lengths to outdo their competition and become the favorites of the ultimate judges: Consumers.

For the next post in our “Tested for you” blog series, my colleague Martin and I donned our “secret tester” hats on and analyzed the top food delivery apps in five Western European countries to rate how they fare in customer engagement and retention. After digesting 4684 kcals and countless app downloads, results are sweet and sour, but despite market over-saturation, there are still untapped growth opportunities to seize out there.

Time to put personalization on the menu

It seems paradoxical that pure online players primarily focus on plastering European cities with traditional display ads sporting Foodora’s pink, Deliveroo’s turquoise, or JustEat’s red. It’s a sign that this is a market of incumbents, with their first objective being their brands staying top-of-mind.

Even social media strategies look very consistent across the different apps and countries: Most are sponsored ads, which would show up on our Facebook or Instagram feeds only after we placed our first order. The social media channels seem to be a customer-retention rather than a customer-acquisition tool. Additionally, the social ads contained an infinite list of restaurant proposals, and were almost never geo-targeted.

Customer profiling is apparently still not on the plate. An interesting exception: UberEats, which, instead of ads, was the only app to send one email per week with basic personalization (“Dear first name,” sent at 6 pm, on time to buy that food for dinner). What struck us most, though, was that not even one of the apps sent badge or SMS notifications to our phones. What could be more mouth-watering than getting a personal “Hungry for your favorite vegetable pasta?” message ding on your phone, perhaps after long morning meetings, when your stomach starts to grumble?

It looks like food app providers still have a long way to go before they get their contextualized and personalized marketing strategies right.

Food delivery apps should take a cue from molecular gastronomy

Once you’re out of a metro area, it’s much harder than you’d think it would be to get the fresh food of your choice. Despite using your location, you cannot filter restaurants using basic criteria like hours or type of cuisine, let alone more advanced filtering criteria like researching by ingredients or customer ratings, which are available only on UberEats and AlloResto in France.

The majority of apps do not provide customer ratings at all on the restaurants they serve. A suggested improvement would be to link the restaurants with ratings for their establishment on Tripadvisor or similar. Without the ability for customer feedback we both asked ourselves: What’s the added value then, compared to old-fashioned phone ordering at your trusted restaurant around the corner? And indeed, most people seem to still order food by phone.

Just as molecular gastronomy scientifically tracks the exact processes of taste from taste buds to nervous systems, food delivery companies should adopt a similar approach to mapping customer behavior and customer experience on their apps. Technology can provide explicit and implicit customer behavior tracking. Enabling fast and flexible addition of functionalities on the apps is the secret ingredient to customers coming back for more.

Don’t forget: Quality ingredients include outstanding customer service

Overall, the food quality was satisfying and we experienced delivery waiting times of around 30 minutes consistently across apps and countries. However, transparency about delivery status and service levels varied greatly. In Germany, Foodora offers a view of the delivery progress on the app, while JustEat, one of the biggest market participants there, delivers mostly good food quality, but a customer experience very close to traditional delivery service.

Service levels are also inconsistent. For example, one order forgot to include parts of the meal, so the local restaurant offered a free substitute and arrived later with the fresh dish. In another case, after 45 extra minutes of waiting time, the app provider only offered 5€ vouchers as a refund, but they expired in 3 days, so they were virtually useless. We also bumped into some funny discoveries: On, you can hardly find good pizzas. There seemed to be an issue with delivering pizza in a box that didn’t turn crispy dough into a mushy something.

One point we agreed on: The best option to get fresh and high-quality food is to order Asian food. Then again, why not just phone your trusted restaurant around the corner—especially if you live in the countryside in France or Germany, where the choice of restaurants provided by the apps is extremely limited.

An abundance of growth opportunities

One interesting note: Between the time we created this post and the publication, we discovered several new hiring positions in digital marketing for the leading food delivery companies in Italy and Germany. We took it as a good sign, one that demonstrates companies consider this an area with much room for improvement, with investments toward more sophisticated techniques—an attempt at moving away from competing purely on price and delivery convenience. This may be additionally confirmed by the fact that food delivery apps are making more agreements with high-end restaurants.

Until companies master the customer experience, they’ll stay hungry as consumers shop for different food delivery options.

Want to learn more about the future of food? Join SAP Hybris for the customer engagement event of 2017. 

Martin Stocker is the co-author of this post.

Erica Vialardi

About Erica Vialardi

Erica Vialardi is the EMEA Audience Engagement Marketing Manager at SAP Hybris.