The Millennial crowd are a tough crowd indeed.
An inheritance of hardship – the recession youth – and an increasingly overstimulated mind has rendered them less inclined to want to part with their hard earned cash. Even less so if the purchase path is strewn with obstacles.
But there is a new breed of brand whose appeal lies in their ability to reduce the burden. We don’t mean some kind of bank-manager-come-councillor setup, but a business whose purpose is to bridge the gap between products or services and their potential consumer audiences, allowing the user to spend their cash wisely and purchase with ease. Let’s call them “convenience brands”.
Enter: Deliveroo. Their USP? To deliver not just fast-food but gourmet restaurant dishes, to your front door, direct from the restaurant kitchen.
Building an army
The UK’s appetite for food delivery has never been bigger. Where dine-in sales have dwindled by just short of 8% over the past five years, the takeaway proposition has grown in popularity by over 2%.
If we think about it, in an increasingly time poor society, that makes perfect sense. Our biology necessitates that we feed ourselves at least three times a day, preferably more, so a hassle free means of doing so is what we’ve all been waiting for, right? Right.
If Deliveroo were an army, they’d have conquered.
With a rapidly expanding team of over five thousand cyclists and drivers (“Roowomen” and “Roomen”), and a market spanning approximately one hundred cities across Europe, Asia and Australia, they are darned near the Mongol Empire of food delivery services.
They’ve managed to entice many top name restaurants too, including Pizza Express, Gourmet Burger Kitchen and Marylebone-based, Michelin-starred, Indian eaterie Trishna.
So how have they done it? Well, their attack was two-pronged: offering customers the ability to order from an almost inexhaustible list of big name restaurants, via an easy App – for a flat rate of £2.50 – and restaurants, who hadn’t previously offered a delivery service, the option to tap into an extra source of revenue for a small commission fee.
And with a 24hr advanced order system, Deliveroo has banished the notion that a takeaway means a night in front of the TV with a greasy Chinese. Now you can cater a dinner party, with restaurant standard food, within your own four walls. The idea has opened up a massive opportunity for anyone to be able to have anything, in food terms.
Disrupting dinner times
But what drives someone to disrupt an industry on such a scale? London-based William Shu founded Deliveroo with lifelong friend Greg Orlowski, after arriving in the UK from New York. An investment banker for Morgan Stanley, Shu was used to working late nights to crunch the numbers.
Where dinner time used to be a treat, he grew increasingly exasperated at the lack of decent food delivery options, and the lengthy wait times, compared with his experience of the NY takeaway market;
“When you’re working that hard and you don’t think about anything else, your sense of reality becomes warped and it becomes a huge issue… So I called up a childhood friend of mine Greg at the time, who was a software developer, and said ‘Hey why don’t we do something about this?’”
- William Shu, Co-Founder of Deliveroo
Invigorated by the idea of bringing something new to the UK food scene, Shu undertook an MBA back in his native America and he and Greg – at that point a software engineer – teamed up to take on the market.
The business was birthed from Shu’s own London flat in early 2013 and, with only three restaurants on board to get it off the ground, they undertook and aggressive expansion plan.
One of the pair’s biggest bugbears was the lengthy wait times associated with the traditional takeaway experience. In the first eight months of the venture, Shu made deliveries himself for five hours a day on his scooter. In order to fully understand the logistics of the business.
And Deliveroo really has stepped up to the plate (ahem), using tech to plan and refine routes for its bicycle and moped fleet. Where he began by physically riding the routes to “shave off elements of the journey”, technology has taken over to continuously refine, minute by minute;
“His team of data scientists run simulations on Deliveroo’s own software to better understand new geographies, and are constantly re-testing its core routing algorithm that decides how to pick the right driver to deliver an order.”
Several successful investment rounds and the backing of a number of angel investors meant the brand was able to expand its model into new markets and now, it says, it is profitable in an unspecified number of those markets.
The future of food ordering
Now not far off joining the other “Unicorns”, in the business of being a global mega-brand, Deliveroo are reported to have received over £400m in investments and are planning to add the US to their list of colonies.
There are also rumours of plans to rollout a massive so-called “Dark Kitchens” initiative – to feed the nation’s growing demand for takeout from their favourite restaurants.
Similarly to supermarket spaces which cater only to online shoppers, Deliveroo plan to offer a vast kitchen network which isn’t attached to any specific restaurant, in hopes that it will ease the pressure on restaurant kitchens.
This isn’t to say that Deliveroo are the only ones making waves in the world of takeaway dining. In fact, hot on their heels are UberEats which, with a giant of a proposition already behind them, are pitched to do very well indeed.
Where Deliveroo paved the way, many are sure to follow.
It all goes to show that you can have an idea, build on it from your bedroom, and take on the world. That’s how you Deliver-do it.
“You should start a business because you’re passionate about something, not because you want to make money.”
- Will Shu, Co-Founder of Deliveroo