April 21, 2021

US Online Food Delivery Market to Grow to $28.5 Billion

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The global online food delivery market was worth $136.43 billion in 2020. It was a significant change over 2019’s $107.44 billion. According to the research data analyzed and published by Comprar Acciones, it is projected to grow by 11.1% in 2021 to $151.53 billion. In the US, the market is set to grow at 7.4% in 2021 to reach $28.49 billion. Moreover, based on a Morgan Stanley report, the US food delivery penetration rate was at 9% in 2019. In 2020, it rose to 13% and could go as high as 21% by 2025.

Grubhub’s Exclusive Customers Drop from 71% to 49%

The US online food delivery market has a handful of top players that play the dominant role. In 2018, these included DoorDash, Grubhub and Uber Eats. At the time, they had a collective market share of 70%. Grubhub was in the lead with a 55% share at the time but gradually lost to the competition.

However, as of October 2020, DoorDash became the lead player with a 45% market share. Uber Eats was second with 30% and Grubhub took the third spot with less than 20%.

For Uber Eats, the $2.65 acquisition of Postmates completed in November 2020 boosted its share significantly. It had approached both DoorDash and GrubHub for acquisition deals and failed. Grubhub ended up getting acquired by Just Eat Takeaway for $7.3 billion in June 2020. The deal is set to close in Q1 2021. It will create the second largest food delivery company outside China.

Part of the reason for the wave of consolidations in the industry is that customers are not loyal to any single service. According to a study by Second Measure, 71% of Grubhub customers did not use any other food delivery service in 2018. However, by Q3 2020, the figure had dropped to 49%. DoorDash had 53% exclusive customers in the same quarter while Uber Eats had 43%.

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