Investments Spurring Aggressive Expansion of Food Delivery Companies to Thrust Global Revenues to $200 Billion, Predicts Frost & Sullivan
Frost & Sullivan predicts online food delivery industry revenues to rise from $82 billion in 2018 to a staggering $200 billion in 2025. That translates into a combined annual growth rate (CAGR) of 14% as a result of increasing global penetration, strategic mergers and acquisitions, and adoption of new technologies such as artificial intelligence, AR/VR, drones and autonomous vehicles.
The sector plays a unique role in bringing together several technological advancements, companies and processes to provide convenient, quick and cheap food delivery to end customers.
"Automotive OEMs will actively participate in the development of specific autonomous vehicles such as drones and ground bots for the online food delivery industry, either through their own programs or acquisitions," said Viroop Narla, Team Leader, Automotive & Transportation at Frost & Sullivan. "A combination of autonomous aerial and ground delivery methods is expected to make the future of food delivery more efficient and cost-competitive."
North America has the highest concentration of online food delivery companies. Homegrown Uber Eats has the highest presence globally, operating in more than 670 cities. However, in certain countries, local players alone dominate their home markets, such as Meituan Dianping in China, Swiggy in India and iFood in Brazil.
Frost & Sullivan's latest research, Future of Global Online Food Delivery Services Market, analyzes the global online food delivery industry and discusses the current market scenario, key trends, innovative strategies, and competitor profiles, and provides a region-wise revenue forecast for the sector through 2025.
Asia has been the largest market for online food delivery globally, passing $45 billion in revenue in 2018. China contributed over 73% of that share, with India a distant second at 13.2%. The Asian market will surpass $100 billion by 2025. Europe is expected to grow at a CAGR of 14.5% between 2018 and 2025, which is higher than any other region.
"Online food delivery companies will increasingly look at new revenue streams to stay ahead of the competition," noted Narla. "Cloud or dark kitchens are expected to become a very popular setup for these companies to either prepare food or rent space to other food businesses."
Market participants can explore the growth opportunities in:
Pursuing continuous onboarding of restaurants and other food providers to expand selection for customers and broaden reach.
Adding features such as payment wallets, subscription offers and crafted meal options to ensure customer retention and spur innovation.
Improving penetration in growing markets with a large population, such as India, Asia-Pacific, and Africa, which is critical to future success owing to their large segment of millennials and a burgeoning middle class.
Exploring the concept of ghost restaurants under their own brands or licensing through third-party companies, as this reduces overhead expenses significantly.
Future of Global Online Food Delivery Services Market is part of Frost & Sullivan's Automotive and Transportation research and analyses available through the Frost & Sullivan Leadership Council, which helps organizations identify a continuous flow of growth opportunities to succeed in an unpredictable future.
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