By Sylvain Charlebois (AIMS Senior Fellow)
The user rate for food delivery apps has reach a record level in May 2019. A recent survey conducted byAngus Reid Global, in partnership with the Agri-Food Analytics Lab at Dalhousie University, suggests that 29% of all Canadians have used a food delivery app at least once. Data was collected across Canada, from May 17 to 19 2019, and a total of 1500 Canadians were surveyed. Findings suggest that food delivery apps are more popular West of Quebec than in Eastern Canada. Atlantic Canada and Quebec have at the lowest use of app users across Canada, at 15%.
Manitoba has the highest rate at 45%, which can likely be explained by the popularity of SkipTheDishes. According to our recent survey, the Manitoba-based app is the most popular site in Canada, with a market share of 29%. UberEATS is second at 14%. Respondents earning more than $100k have the highest user rate at 33%. Unsurprisingly, the majority of users (52%) are between the ages of 18 and 34.
SkipTheDishes has the highest satisfactory rate of all apps at 89%, followed by UberEATS at 86%. Both scored high compared to other apps available to Canadians. Most respondents praise the speed of delivery, the quality of the food, and the options given for tipping the driver. Prices and packaging solutions also appear to be factors affecting the overall satisfactory rate.
Despite a high satisfaction rate of many leaders in the market, the intent to use delivery apps is slowly approaching its peak in some parts of Canada. A total of 31% of Canadians intend to use a food delivery app within the next 6 moths which is 2% more than the current user rate. Only 37% of consumers in Manitoba intend to use a delivery app over the next 6 months which is down from 45%. For other regions, 42% of respondents in Saskatchewan plan to use a delivery app over the next 6 months, which would be an increase of 10% from the current user rate. Almost 23% of respondents in Quebec intend to use a delivery app over the next 6 months, up 8% from the current user rate. For other provinces, we expect user rates to increase but very slightly.
Food delivery apps are technologies that have emerged over the last 5 years and are now very common in Canada. Food delivery apps have benefited from a massive conversion from foot traffic to online purchasing of food. Based on this most recent survey, we expect Canadians to continue to use apps on a regular basis, but do not expect the market to expand further in a significant way. As grocers, meal kit providers expand their e-commerce presence, causing us to expect consumers to vary their purchasing habits.
Some apps do showcase well-established restaurant chains, which appear to be the case for SkipTheDishes. Yet for other apps, independent restaurants are more predominant. UberEATS and Foodora appear to have more independent restaurants on their apps. Or at least, independent restaurants are easier to find when ordering online.
Overall, we believe food delivery apps are here to stay, but since the intent to use within 6 months is lower than the current user rate. We don’t expect the user rate to increase significantly over the next 2 years, but there is the possibility of the rate beginning to increase once again in 2022. More that 56% of respondents willing to use a food delivery app over the next 6 months are between the ages of 18 and 34. That will drive demand for this kind of service and will likely increase user rates across the country. And finally, access to more options for a greater number of Canadians may increase the user rate, especially in rural regions of the country where the current user rate is 8%.
SYLVAIN CHARLEBOIS,
Professor in food distribution and policy, Dalhousie University
Senior Director, Agri-Food Analytics Lab, Dalhousie University.
