Are you covering the future of restaurant delivery?
The pandemic disrupted how consumers eat, driving us away from on-premise dining and toward delivery platforms like DoorDash, UberEats, and GrubHub. But the boom in delivery is about to take a hit.
Goizueta Business School professor Dan McCarthy’s latest research says that as dine-in recovers, the delivery side is expected to drop considerably. COVID made the year for restaurant delivery. Industry-wide delivery sales went from ~$23B (2019) to ~$51B (2020), growth of ~$28B. About $19B of that $28B (70% of total) was purely due to the pandemic.
Delivery growth was largely due to people replacing on-premise restaurant visits with delivery orders, either because on-premise dining wasn't allowed due to dine-in restrictions, or because they were afraid to go on-premise for health reasons.
The other major mechanisms -- employment changes, store closures, and individuals staying completely at home -- all depressed delivery sales, all else equal.
Substitution from dine-in more than compensated for those sources of weakness.
If dine-in activity were to return to pre-pandemic levels, McCarthy expects a significant headwind for delivery sales. For more, read the paper here, and the summary here.