The pizza and food delivery wars are heating up again.
With more people staying home and ordering pizza delivery during COVID-19, the financial impact on pizza delivery has been significant. Domino’s reported $920 million in Q2 revenue, more than $108 million than during the second quarter of 2019. And just last month month, Domino’s added 39 new stores in the United States, in addition to another 45 new locations around the world.
What’s also interesting about the growth is where it’s coming from — 65% of U.S. sales are coming from digital channels, while 50% of global sales are via remote channels. In other words, online ordering has become the main channel for pizza deliveries.
COVID-19 is clearly having a massive impact on the delivery, and when combined with another year of unexpected and crazy weather all across the globe, it gets complicated. In fact, on-demand and delivery margins are smaller than ever, with the weather having a significant impact on the food delivery industry.
In order to further understand not just the state of pizza and food delivery, we did a survey to understand how the weather is impacting the industry and the most exciting opportunities to drive consumer growth. What we found isn’t surprising, but it is enlightening for on-demand and pizza delivery companies everywhere. Here are the results.
Pizza delivery survey
Our survey group consisted of an anonymous group the following:
- 277 survey responses
- Ages 18-50
- Based in the United States
- 60% male and 40% female
- Household Income of $100k – $150K
We asked respondents 5 questions, which included:
- When the weather is bad (rain, snow, ice, cold…etc), how likely are you to order pizza delivery?
- How important is the expected delivery time when ordering pizza?
- If your pizza delivery is later than expected, how likely are you to consider a different restaurant next time you order delivery?
- Are you willing to pay more for faster pizza delivery?
- Would you like getting notifications on your phone when the weather will be bad, so you can schedule pizza delivery in advance?
The results, as expected, were quite interesting.
Results: ETAs are incredibly important
Here are the core takeaways from the survey:
- 49% of people are more likely to order pizza delivery during bad weather
- 92% of people say expected delivery time is important to them (within the 92% group of respondents, 39% said it’s very important)
- If the actual delivery time is later than the expected arrival time, 69% of people are likely to consider a different restaurant the next time they order (within the 69% group of respondents, 19% said very likely)
- 32% of people are willing to pay more money for faster delivery
- 56% of people would like to receive notifications on their phone when the weather is going to be bad so they can schedule a pizza delivery in advance
A competitive delivery advantage
A few things are clear from this data. First, the weather significantly impacts how people think about food delivery, as 49% of people say they’re more likely to order delivery during bad weather. Second, consumers are looking for help to make their lives easier before bad weather arrives. In fact, a whopping 56% said they would like to pre-schedule food delivery via cell phone notifications before a storm impacts them.
Using predictive weather impact data for on-demand operations opens up a number of exciting growth opportunities, but it all starts with having access to the right data via a weather API or predictive software. Below you can see an example of an impact dashboard for on-demand and pizza delivery companies:
As you can see, companies can understand the impact weather is going to have on their operations, supply and demand, and even ETAs multiple days in advance. This can have an impact on both first-time customer experience and customer loyalty, as 92% of people said expected delivery time is important to them. Even more importantly, weather impacts ETAs more than anything else, and with 69% of people saying they’d consider a different restaurant the next time they order if they’re actual delivery time is different than their expected delivery time.
It’s clear that understanding the weather can have a big impact on your bottom line. By better preparing for expected demand and adapting to weather delays in advance, you can help save future revenue and improve customer lifetime value.