Once there was a magic show in the town. A magician asked a 10-year-old kid, “What do you like to eat?” A kid said chocolate. He performed some magic, got a chocolate and offered it to that kid.
So, do you think he actually applied a magic or a trick? Is magic real? Well, what I think is that it’s a subject of practicing hand tricks. Nevertheless, we can always consider it as a way of attracting customers for a better business opportunity. And this can be possible by leveraging the power of the latest technologies, tools, and applications developed by web and mobile app development companies.
Let’s think about the food you’d like to have from your favorite restaurant at home and receive it in minutes. Your wish can be a command and you can enjoy a pizza platter at the comfort of your home in minutes. In this digital world, technology evolves and transforms every industry by bringing a digital dimension to the business.
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You must be wondering – How? Well, that’s what we are here to discuss.
A report from Statista states that the revenue in the online food delivery industry is expected to grow by US$449,292m worldwide and US$45,332m in the USA by 2025. In the United States, the Online Food Delivery industry is predicted to rise 12.2 percent in sales by 2022.
This data is categorized into two different categories:
1. In the Platform-to-Consumer Delivery segment, the number of users is expected to amount to 2,114.3m users by 2025. And the revenue is expected to show an annual growth rate (CAGR 2021-2025) of 9.37%, resulting in a projected market volume of US$247,428m by 2025.
2. In the Restaurant-to-Consumer Delivery segment, the number of users is expected to amount to 1,845.2m users by 2025. And the revenue is expected to show an annual growth rate (CAGR 2021-2025) of 10.82%, resulting in a projected market volume of US$201,864m by 2025.
Considering the recent scenario (COVID-19), the growth in food delivery apps will continue to increase.
So, if you are planning for a food delivery app development, you have landed in the right place. Let’s walk through the different key areas of mobile food delivery, from features to current industry trends.
But before we get into it, let’s understand how the pandemic impacted the industry and how the modern food delivery app process changed in response to the COVID-19 pandemic.
Food Delivery Industry in 2021
Despite major growth in the food delivery industry, many companies were struggling to thrive at the beginning of 2020. Many big brands such as DoorDash, Postmates, and Uber Eats were all in negotiations of merging in various combinations, but none of the verbal communications led to a concrete conclusion. Then there was a catastrophe – a pandemic hit the world and disrupted the status quo.
So, during the lockdown period, food delivery services skyrocketed immediately. Everyone was looking to get essential products and foods delivered to their doorstep. So, the quarantine period opened a wide gate for on-demand food delivery app business.
Although it may appear that industry giants control the market, that’s not completely true. During the pandemic, on-demand food delivery startups exploded worldwide, and they are still gaining popularity.
Glovo, a Spanish startup that partners with brick-and-mortar businesses to deliver restaurant take-out, groceries, and other items – gained $528 million in funding. Similarly, Gousto, a UK meal-kit service, raised $41 million during the lockdown.
Gorillas, an on-demand grocery startup that aims to deliver goods in ten minutes or less, has raised $290 million, exceeding its initial $1 billion valuations.
The Future of Food Delivery Sector
As we know, we don’t live in the magical world, nor do we have any divine power. But in this technology-driven world, it’s the same as the magical world to make everything possible with one touch.
The online food delivery services remain high, but this buzz may not last forever; sooner or later, the pandemic-driven growth will be decreased. On the other hand, on-premise services will continue to grow even after the pandemic.
As per the records from Datassential – September 2020, 59% of food delivery consumers claimed they would continue to use delivery apps after the pandemic ends.
Well, in this AI-driven world and adoption of drones/robots, there would be existence for contact-less food delivery.
The industry tried to adopt various technologies during the pandemic in order to maintain safety and hygiene protocols. Moreover, customers also transitioned from cash-on-delivery to cashless payment, which tends to enable contact-less deliveries. Such methods minimize unnecessary in-person touch, interactions and reduce the risks.
Hence, contact-less delivery has stolen the spotlight in recent times.
Now that we have a great market insight, it’s time to understand some on-demand food delivery app models.
Business Models for On-Demand Food Delivery App
If you are planning to develop a feature-rich food delivery app, you should know three main business models to consider. So, let’s dive into those categories to find out their advantages.
1) Platform To Consumer Model
Many famous restaurant delivery services apps like Uber Eats, DoorDash use the Platform to Consumer model. This model brings together all of the offerings of small restaurants and allows customers to order from them via the app platform. Here, the restaurant partners are responsible for their own fleet of couriers.
This model seems to be more profitable as platforms generate revenue from both customers and restaurants by charging a fixed amount as a fee for each other. The model’s value proposition for restaurants allows them to bring and automate orders via an optimized mobile app/web platform, replacing the traditional food ordering paradigm via phone calls.
2) Delivery Service Aggregators
The Delivery Service Aggregator model is technically a part of the Platform to Consumer model. But it’s completely worth being separated.
The platform works as a bridge between a customer (user) and numerous local restaurants in the aggregator model. In case customers face any problems with their deliveries or orders, they offer customer support on behalf of these restaurants. Here, the platform charges a fixed amount of fee on every successful transaction.
GrubHub, JustEat, or Delivery Hero are the food delivery platforms that utilize this model. Moreover, some of the companies have tried to adopt subscription models in which customers are liable to pay a monthly fee in order to leverage other benefits such as discounts and free home delivery.
3) Restaurant to Consumer Model
In the Restaurant to Consumer Model, the restaurant serves food to their customers from their own locations. McDonald’s, Burger King, and Domino’s are well-known examples following this model.
Moreover, these companies adopted food delivery from their websites, apps, or joined delivery platforms to modernize the approach. In addition, they can join their hands with food delivery partners like DoorDash, so they don’t need to serve by themselves.
Domino’s turned out to be a game-changer for the food-delivery revolution. Some of the company’s latest innovations are:
- To place orders, a voice recognition system is used.
- An app that allows users to track delivery while it is on its way.
- Drones are being tested for automated delivery.
Integrate These Powerful Features for a Food Delivery App
As a renowned mobile app development company, we are curating all must-have features that a food delivery app should have for customers, restaurant owners, and drivers.
Let’s get into it.
1) Customer’s App Module
The search filter allows users to search and explore cafes and restaurants with their locations and food.
Customers can easily place their orders for delicious food from their favorite restaurants with a few clicks. Here, customers can select the food of their choice and add it to their cart. Then, they can proceed with the final order placement.
Once the order is placed by customers, they can track their ordered food through a geolocation map. Isn’t it a great feature to make the best and modern food delivery apps?
It allows customers to check how much time a delivery boy will take to deliver. This helps in developing trust and putting faith in the food delivery service providers.
Payment Gateway Integration
Payment gateway integration allows users to make online payments using Debit/Credit Cards, internet banking, etc., for the food they order. On the other hand, restaurants can easily receive the money through payment gateway integration like PayPal, Stripe, and etc.
Reviews and Ratings
Feedbacks and customers ratings play an important role in building strong competition in the market. You should incorporate this feature for your users to rate and review your app or services you provide so that you can overcome issues and win the customers’ hearts.
Order history turns out to be a time-saving feature for users. It allows them to manage and view their past orders. Moreover, they can also repeat the previous orders whenever required.
It allows users to view all the top and nearby restaurants based on the user’s location. Users also can view its menu, price, reviews, and order a meal from there.
2) Delivery Driver’s App Module
This allows drivers to log in or sign up for the app using phone numbers, Gmail, or different social media networks. The whole signup or login procedure should be hassle-free for new joiners to enroll themselves easily.
A driver can upload their information like name, email address, contact details, photo, and others using this user profile. Therefore, it becomes easier for users to know their basic details.
Alert and Notification
How will drivers come to know about their new food order?
This notification feature, on the other hand, alerts the drivers about any new orders that have been assigned. When the drivers are not using the delivery app, they should receive a sound alert for the orders that have been requested.
Manage Multiple Deliveries
At the same time, drivers may handle and respond to various food delivery requests. They can accept any request that is close to another delivery location.
GPS Map Integration
GPS Map Integration is one of the most useful and amazing features for a delivery person. GPS addresses the food delivery person by suggesting the most convenient routes. A delivery person may be required to add a last-minute order, in which case he will require a shorter route to be at the destination on time.
If the consumer has a problem, the delivery person can use the chat or call option to reach them and call them.
Under this feature, the delivery agent can view their food delivery ordered history and payment records.
3) Admin Dashboard Module
Each activity performed by users or delivery persons on the food delivery app can be monitored by an admin. The admin dashboard allows them to keep a track of food delivery, drivers and scheduled/canceled orders and access driver information.
Manage Order Requests
From food parcel pickups to delivery and scheduled orders, you can manage everything. You are responsible for simplifying orders and delivering them to customers at a given time.
The availability of delivery agents and restaurants must be tracked by the administration. This feature lets you receive real-time updates and notifications about drivers and restaurant owners, such as updating their profile, restaurant timings, and availability.
Payment and Commission Administration
The food delivery agents and restaurants can manage payment and commission rates for every food order using this admin interface.
Offers and Discounts
It allows the admin to offer various discounts and coupon codes on the app.
Admin gets alerts and notifications once the driver accepts the order requests and is on his way for parcel collection/delivery.
It allows the admin to add and delete restaurants from the app.
The admin can run and manage different campaigns through email, SMS, and social media marketing.
Revenue Models for Modern Food Delivery App
Well, there are many revenue models you can integrate to make modern food delivery applications. Once you hire the ideal mobile app developer for the app development, they will help you choose the appropriate revenue model to generate more revenue.
You can consider the commission-based model for your on-demand food delivery app development. The portal owner will receive a commission from restaurants for each order placed through their portal under this strategy. When consumers order food from a restaurant, the restaurant pays a commission to the aggregation platform.
In the subscriptions model, the admin charges the merchant a monthly or yearly subscription fee for listing his restaurants on the food delivery platform.
3) Paid Advertisements
One of the best ways to generate revenue is to offer paid advertisements by highlighting some restaurants and their food in the app. The admin will charge restaurants by promoting their ads in the app.
Moreover, food providers can pay for banner advertisements with their special meal recommendations. This revenue model is highly recommended for renowned services, so you can consider this model once your app gains a huge user base.
4) Delivery and Other Charges
The portal owner charges delivery commission from customers. If the admin utilizes his logistics network to deliver the food, he can charge clients a delivery fee.
One way to generate revenue is to use surge pricing during busy hours. Restaurants will have to pay a larger commission to the app in order for it to process their requests faster. It’s also feasible to charge clients a higher commission for faster order fulfillment.
Tools and Technologies Used for Food Delivery App Development
Let’s understand the latest tools and technologies to integrate for your on-demand food delivery app.
|Programming Languages||Java, Kotlin||Swift, Objective-C|
|Toolkit||Android Studio, Android Developer Tools||Apple Xcode|
|SDK||Android SDK||iOS SDK|
|Mailing Services||Gmail, SendGrid, ZeroBounce, MailGun, TempMail, FastMail, Firebase Cloud Messaging|
|Push Notifications||Twilio, Nexmo, Plivo, Sinch, Apple Push Notifications Service (APN), Firebase Cloud Messaging (FCM)|
|Social Media||Twitter, Facebook, Instagram, Snapchat, Viber|
|Payments||Stripe, Braintree, Google Pay, Apple Pay, PayPal’s SDK|
|Restaurants API Solutions||GrubHub, Zomato, Foursquare Places|
|Location Tracking||MapKit for iOS|
How Much Does It Cost to Develop an On-demand Food Delivery App?
The overall cost to develop an on-demand food delivery app depends on various factors, such as several features, the complexity of mobile app development, third-party integrations, proper mobile app development process and many more.
Now, let’s understand the other factors here as well:
- App Features and Functionalities
- Project Analysis and Scope Statement
- UI/UX Development
- App Platforms
- App Deployment
- App Maintenance
- App Security
- App Development Team
As a business owner, if you are planning to develop an on-demand food delivery app, it requires in-depth market research, industry knowledge, and a proper budget. Therefore, we shared on-demand food delivery features, business models, revenue models, and technologies in this guide, which may clear your mind about making a perfect food delivery app.
So, while on the verge of developing a feature-rich food delivery app, it’s important to understand which food delivery market you are planning to target, the problems/challenges to handle, and your goal.
As a part of our initiative to assist food providers in setting up their online food delivery business, an experienced mobile app developers from Radixweb offer the best mobile app development services irrespective of their business sizes. If you are looking to develop a food delivery app and understand its development process, we are just a message away. You can contact us, and our expert will be there to answer all your queries in no time.