How Much Is the Online Food Industry Worth?
If you’ve ordered your groceries or takeout online this year, you’ve contributed to the massive wealth of the online food industry. Currently, the global online market is worth $111.32 billion, and the industry is only growing. Food delivery services are expanding, and more grocery stores offer online ordering now than ever before. From caviar to beer, you can satisfy even the wildest cravings with the touch of a button.
What exactly led to this surge in net worth, and how will the events of 2020 affect the industry in the coming years?
A Brief History
Food delivery is nothing new. The first pizza delivery occurred way back in 1889 in Naples, Italy. Then, in World War II, chefs and volunteers delivered meals to citizens seeking cover from bomb threats. In the 1950s, soldiers returning from war popularized pizza delivery in the States and, 10 years later, food trucks entered the scene.
However, online ordering didn’t make its debut until the early 2000s when GrubHub and major pizza chains began creating mobile applications. By 2015, online ordering began to overtake mobile ordering and, two years later, DoorDash university startups began implementing robot delivery. Meal kit delivery services like Blue Apron also launched during this time.
A Growing Industry
Since then, online ordering has become commonplace. Now, amid a global pandemic, food delivery is enjoying a major moment in the spotlight.
To avoid the grocery store — and the subsequent risk of contracting the coronavirus — millions of people are ordering their groceries online. During March, 31% of U.S. households used online grocery ordering, with 10.3 million of them using this service for the first time. Thus, this relatively new form of online ordering is becoming a major contributor to the wealth of the online food industry.
Digital foodservice orders are also experiencing a boom as many restaurants had to close their doors to dine-in customers during the pandemic. In May, these online orders increased by 138%, and now, new users represent nearly half of third-party food delivery apps. Of course, the global economic slowdown has slowed the overall growth rate of the online food industry. However, it will likely experience a major rebound next year.
The Future of Online Food
According to surveys, 43% of individuals using online grocery services are very likely to continue doing so. Moreover, 30% of households who didn’t use these services in March would likely try it over the next few months. Likewise, experts expect those who tried online food delivery during the pandemic to continue using mobile applications and online ordering even after restaurants re-open.
Still, more than 50% of Americans are cooking at home more than they were before the pandemic. Thus, restaurants will have to continue diversifying their services to offer DIY meal kits and experimental food bundles if they want to attract these newfound chefs. If more businesses rise to the challenge, the online food industry will likely expand and exceed even the most optimistic future predictions.