By now we all know how online businesses are thriving across the world on the unprecedented rise of on-demand delivery services. The online food market is one such field that is growing at a rapid pace, given that more and more customers are enjoying the conveniences of on-demand food delivery at their doorstep.
Moreover, the impact of Covid-19 worldwide has caused numerous brick and mortar businesses to shift online, further triggering the growth of online businesses.
To utilise these opportunities, besides the major food delivery platforms, which are already dominating the area, many start-up food businesses are entering and taking advantage of the market potential. The players who are operating in this field are experimenting with mainly two sets of business models; one that is creating food delivery platforms, which is working as the point of interaction between customers and multiple restaurant owners. The other set of business owners are the ones who have their own food businesses and are launching independent food delivery app.
So, if you are planning to launch a food delivery app, this is a good time to make such a decision. However, since the market is getting crowded and the competition is rising, it is not so easy to keep a business afloat and achieve quick success.
Hence, before you take the final step, you need to consider a few important points. Whether you are planning to create an aggregator or independent food delivery app, you can take the help from this blog and get all the information on how you can build and successfully launch a potential food delivery app.
Why you should invest in a food delivery app and what is the market potential?
Even though the food delivery market is crowded and major players are already dominating the area, many new players are still entering the market to utilise the opportunity that this market is offering currently. Let’s check out why the market is still expanding and promises a lot of growth opportunities;
- More and more people are seeking an online solution for convenient and doorstep touch-free food delivery services due to the pandemic
- According to Adroit Market Research, the online food delivery market is likely to touch $161.74 Billion by 2023
- It has been estimated by Restro App, that per customer, the revenue is likely to touch $12 in 2023 for food businesses that have their own delivery app in comparison to an $8 rise per customer for the food business that depends on third party delivery platforms.
- As per Statista, the growth of food delivery apps users are estimated to touch 53.9 million by 2023
These figures ensure, the opportunities are widening in the food delivery market and there is a lot of scope for the budding service providers in this area. So, before you venture into the field, let’s check out some of the major food delivery platforms that you have to compete with;
- Domino’s Pizza, etc.,
Different Business Models for food delivery app development
Let’s explore here the different types of food delivery app models;
In an aggregator business model, the platform is the point of interaction between the consumers and the food delivery units. Under this model, the platform can have an integrated food delivery system or may not have one.
Let’s check out below, how both these aggregator platforms that have their own food delivery system and the platforms that don’t have integrated delivery system operates.
Aggregator, who doesn’t have logistics for food delivery, works in the following way;
– The consumer selects his/her favourite food and places the order
– Settles the payment through online mode, also can choose offline mode
– The platform sends the inputs to the specific restaurant
– The restaurant sends the food to the customer’s address with the help of their own courier
– In the case of offline mode, the payment is cleared in this step
On the other hand, the aggregator with logistics for food delivery works in the following way;
– The consumer chooses the food items and places the order
– Consumers choose the online/ offline mode of payment. For online mode, the payment is settled in this stage
– The restaurant gets the order and places delivery request to the platform’s courier to pick up the order
– The food is delivered by the courier service of the platform
– Payment is settled in case of offline mode
- Hybrid Platforms
In the hybrid business model, the restaurant just creates an independent app with the help of quality mobile app development services and delivers the food order on their own or appoints a third-party delivery company to deliver the food orders.
Since, these models do not require the restaurants to make a huge investment, these models are great for small businesses.
Let’s see how this model works;
– Consumer places orders after selecting their foods
– Settles the payment
– The restaurant gets the order and packages the order
– Restaurant arranges to deliver the food packet to customer by their own staff
– Or, the admin of the application finds the order request and send the information to the third-party courier for picking up the order
– Food is then delivered at the doorstep of the customer
Why popularity for on-demand food delivery app development is on the rise?
While a restaurant can collaborate with major platforms, it can also launch an independent food delivery app. A restaurant partnering with a top platform has its own benefit. On the other hand, it also faces plenty of challenges. To know, what are challenges that the restaurant can eliminate by launching its own app has been listed below for you to check out;
- Dependence on delivery partner
Collaborating with third-party apps requires the restaurants to pay delivery fees to the platforms. Given the policies, rules and regulations can be altered anytime according to the discretion of the third-party organisation, they can change it anytime and increase the fees. This sudden change can impact the business of the restaurants and can cut into their revenues.
In the case of an independent food delivery app, the restaurant is not required to pay fees and deal with uncertain decisions.
- Limitations to control food delivery service quality
Multiple restaurants are present on the platform, and thus, your facilities and USP is not conveyed to your customers, therefore you cannot control how your service is catered to the customers. This is another downside of partnering with a third-party platform and can be eliminated by launching one’s own app.
- Limited scope to build customer loyalty
There is another limitation that a restaurant can face while working with a delivery partner, the restaurant is not able to reach customers individually. Most of the time, activities related to promotion and advertisements are taken care of by the platform and sometimes the restaurants can charge a hefty fee for promoting and advertising the restaurants on their platform. Henceforth, the restaurant can lose out on the opportunity to build customer loyalty.
These are some of the reasons, why you should consider launching your own food delivery app and serving your customers to establish your own presence and build customer loyalty.
Different types of revenue streams for the food delivery apps
There are multiple ways through which a food delivery app can earn revenue. You can get a good idea about the types below;
Whenever a customer orders food from a particular restaurant through the aggregator’s platform, the restaurant pays a certain amount of commission to the aggregator.
Under this model, the users have the option to subscribe to the service provider’s services. By signing up for the subscription forms users can receive special offers, free delivery and heavy discounts etc.
- Busy Hour Fee
Busy hours are great options for earning money. Applying this model, the food delivery platforms hike the fees for the food delivery during busy hours and earn a two-way income, i.e. by charging the restaurants higher fees for the orders and also, by increasing delivery charges customers.
- Paid advertising
One of the most lucrative ways to generate revenue for the platforms is by charging fees for advertising and promoting some restaurants on their platform.
Guide to start your food delivery app
Since now you have a fair idea about the framework in which the food delivery apps run, let’s dive in and understand how you can start a food delivery app for your business;
- Analyse the market first and identify your target customers
If you want to launch a food delivery app, you need to first analyse the market (especially the market you are targeting, it can be local or global), the key competitors, identify the target customers. Investing in proper market research will help you to build a versatile food delivery app. Follow the below steps to get an idea of how you can thoroughly analyse the market;
– Identify the market that can help your business idea to flourish
– Recognise the viable project concept (this includes the business model, app type, features etc.)
– Find your market niche where there is scope for new applications
– Acknowledge the suitable demographics by studying and testing your ideas among the set target audience
– Study the collected data and understand what type of food delivery app you need to build
- What’s your Unique Selling Proposition?
Unique selling proposition can be price structure, product characteristics, placement strategy or promotional strategy for a business to establish its presence in the market and distinguish itself from competitors.
Make sure you identify your unique selling proposition (USP) before you build and launch the app. USP helps to distinguish your business in the market and help to draw a separate acknowledgement from your customers.
Paying heed to Business Model Canvas and its suggested aspects can help you to understand what kind of business you want to build and what USP you want to have;
– Your Key Partners- Stakeholders and people who are assisting in your project. For example; Software developers and vehicle fleet etc;
– Key Resources- Money, people, knowledge etc required to develop your project. For example; investments to build the project and professionals helping you etc;
– Key activities- Activities and actions you take to run your business. Example; Marketing, promotion and traffic generation etc;
– Value proposition- Your service solutions
– For Admins- Order management, Payment processing, profile management
– For end users- Easy order placing, availability of a wide range of foods, online pay mode, prompt delivery
– Revenues- Your monetizing strategy example; ads, commissions and, busy hour price surge etc;
– For couriers- Order management, delivery history, status update etc.
– Target Customers- Buyer persona. Example; Young adults, college students, working professionals, busy parents etc.
– Customer relationship- Community bonding, prompt food delivery
– Channels- Marketing channels. Examples; Promotion, ads, SEO partnership, and events etc.
– Cost Structure- Cost components based on resources and activities. Examples; technical maintenance of app, marketing campaigns and logistics etc.
- You need a reliable and expert app development service provider
For building your food delivery app you need to hire capable mobile app development services for developing and designing your app.
A capable mobile app development company will have-
– Rich experience
– Top-notch resources
– Use cutting-edge-technology to build your app
– Affordable development cost
– Best customer services
Whoever you are hiring to build your app must have an in and out knowledge of your business idea and can help you to build your dream food delivery application.
- Develop the food delivery app
This is the phase where you build the application. This stage mainly consists of three sub-phases;
– The first phase can be dedicated to analysing the business, UX/UI app design research, and creation. You need to consider top features of a home delivery app.
– The second phase is dedicated to development tasks, where the development team builds the front-end and back-end of the application
– In the third stage, you need to pay attention to testing the app usability, quality assurance so that the app functions flawlessly
- Build an app with the best designs
Food delivery app must be designed keeping in mind the factor that designs have a lot of influence on users’ decisions. A well-designed app will be future-ready, user-friendly and have the power to enhance the UX manifolds.
- Build a Flawless application
The application you are building must function flawlessly; otherwise, it may not be able to create any market value. In this case, it is suggested to opt for a native app development procedure for best performance. In comparison to hybrid app development, native app development helps to provide better UX, able to utilise all the unique features offered by the operating system (Android and IOS).
- Proper product testing is a must
Once your app is ready, make it a point to get it tested by a QA specialist. Run the app on various devices and test your app against any possible scenario that can crop up and measure how it runs, check for any flaws. Fix these issues before you launch it.
- Select Potential Marketing Channels to Promote Your App
Building the app and launching it simply will not make it popular. Instead, you need to select suitable channels to market your app. Let’s check out the channels you can utilise;
– Marketing campaigns- After you launch the app, you can launch paid ads to advertise and promote your products
– Influencer marketing- You can get in touch with influencers and bloggers who can enumerate your apps benefits and unique idea to their audiences.
– SMM- You can promote your app using social media platforms. This is one of the effective ways you can promote your app right now.
Top App Features of Food Delivery Apps
You must include a wide range of features in your app and this is divided into three groups;
– Client features
– Courier feature
– Admin features
A food delivery app must have these client features,
– Registration- This includes verification via, email, social media, and phone number. Having the option to register with social media profiles (Facebook, Instagram, Twitter etc.) is one of the quickest sign-in features that you can include in your app
– Profile management- Option to alter the user profile data provided during registration must be included
– Search- Include in your app, GPS enabled search option to enable easy searching of food items.
– Order Placement- Easy order submission, cancellation of orders, order changes
– Payments- You can integrate your platform with GPay, PayPal, credit cards, internet banking etc. Also, the COD option must be available.
– Receipts- View invoice with list of items ordered
– Ratings and Reviews- Option to provide feedback, ratings and reviews
– Notifications- Prompt information for updates related to order status and delivery should be given
– Bookmarks- Bookmark option to wish list favourite food items
– Order history- Order history must be provided
– Estimated delivery time – The real-time location of food delivery man, the time it can be delivered, route etc.
– Loyalty programs- Send personalised offers and discounts and notes
– Social network integration- Provide options for users to share their favourite food items on their social media profiles
Courier features that an app should include are;
– Registration- Include the options for registering with the app through email or phone number
– Profile management-Options to change the profile data should be included
– Order management- Courier must have all the information about the food deliveries, like size, pickup and drop-off locations, estimated time to deliver
– Status update- Included statuses for orders like order placed, order accepted, cancelled or order delivered etc.,
– Navigation- Integrate app with Google maps or Apple maps in order to help the couriers to understand the location
– Delivery history- List of orders which have been delivered must be included
– Earnings- Information on earnings for every order delivered must be provided on a daily, monthly, yearly basis etc.
Restaurant Admin features
Restaurant admin should be able to do the following;
– Registration- Options for restaurants to create accounts by providing business details like name, location, address, working hours etc.
– Profile management- View/update profile data entered while registration, update data on operation hours, add location,
– Order Management- Information access to incoming orders, place delivery request or arrange delivery on its own, update statuses. Tracking data of deliveries after the courier picks it up.
– Content Management- Restaurant menus, meal descriptions with the help of images, price, promotions, ingredients etc.
– Payments- Include important features for restaurants to accept payments, track per order earning, daily, monthly and yearly earning information access.
System Admin features
The list of admin features that your app must have;
– Define Area of operations- Manage area of operations in map
– Manage Restaurant Profiles- Options to create and update restaurants accounts.
– Manage Delivery Personnel Accounts – Add/Edit Delivery Personnels and view current locations of online riders on map.
– Order Management- Information access to incoming orders, statuses. Tracking data of deliveries.
– Content Management- Restaurant menus, meal descriptions with the help of images, price, promotions etc on behalf of the restaurants.
– Manage Delivery Charge- Define unit distance-wise delivery fees.
– Payments- Define platform fees, check payment status of orders completed, track per order earning, view share of restaurants, and update payout requests of restaurants.
– Profile management- Update profile data like Business Name, Email, Contact Number, and Password etc.
Top Tech Components to Build a Versatile App
Building a food delivery is a complex process and requires the right knowledge and proper resources. Top mobile app development services employ quality resources and deep knowledge for building futuristic food delivery apps. Let’s check out some of the technologies used in building versatile apps;
Programming language- Java, Kotlin (Android) and Swift and Objective- C (iOS)
SDK- Android SDK, iOS SDK
Toolkit- Android Studio, Android Developer tools (Android) and Apple Xcode (iOS)
Various Challenges You Face While Developing a Food Delivery App
While building a versatile food delivery app, you can face multiple challenges because the whole process is complex and needs a dedicated solution. You can’t simply build an app and sit back and relax but that app needs to meet the demand of the prospects, serve them with the best facility and prove convenient for use than the existing food delivery application. Thus let’s take a look at all the challenges you can face while building your app;
- App’s Reliability and Scalability
An app must be reliable to use and have features that will help in the smooth integration of a vast amount of data. An app on food delivery can be very complex because it has to run simultaneous functions. These include running back-end programs, for example processing personal data, important financial transactions, security features etc. These are the areas that require proper attention while integrating them with the app during the building phase and also in the pre-building phase for creating a plan listing all the features that need to be included.
Given that, these issues require proper solution and planning you need to appoint a leading mobile app development company that can take care of both the technological side and build a user-friendly app.
- Intense Competition
Major players are already dominating the food delivery app area. If you want to launch an app that can run successfully you need to pay attention to how it can effectively meet the demands of the consumers, have advanced features. You also, need to utilise the right channels to market the application and reach out to appropriate and targeted audiences to emerge as a successful app in the field.
- Searching for partners
Restaurants are always looking for popular platforms that have a huge user base. To draw their attention, you need to build an app that caters to their needs properly. However, in the beginning, it is wise to partner with small local brands.
- Search for the right courier
Collaborating with the right couriers is essential, however, it often becomes a challenge to find and partner with the right couriers. However, you can select reputable couriers and that can solve your problem.
- Retaining Users
You can attract users; some may even select your app for food deliveries, however, it’s difficult to retain customers. This is why you must make sure that your app provides the best UX and pleases the customers with user-friendly and advanced features and most importantly include a convenient ordering process.
Before building your food delivery app and going ahead with the launching process you must be aware of everything that will help you to build an effective application. Through this blog, we have tried to guide you through the entire process and by the end hopefully, you have the idea of what it takes to build a versatile food delivery application and why you need to hire the best app development company.