Food delivery companies are using data and AI as their competitive advantage to break into the food production market, says GlobalData

The challenges for foodservice operators brought about by online food delivery and takeaway meals have only intensified since the pandemic began. Aggregators are capitalizing on the disruption to drive revenue, with AI technologies a key element of their success. AI is essential for these companies because it allows them to make the most of the huge repositories of data collected during the ordering process, says GlobalData, a leading data and analytics company.

According to the GlobalData report, Artificial Intelligence in Foodservice, while the orders ultimately go to foodservice companies, it is the food aggregators that are collecting the bulk of consumers’ data, from their food tastes to their personal and payment details. This gives them a significant competitive advantage, contributing to a growing imbalance in power relations between aggregators and foodservice companies (especially the smaller ones).

Alice Cordo Gallucci, Thematic Analyst at GlobalData, comments: “Some aggregators, including Deliveroo, Swiggy, and Uber Eats, have started to go a step further, using the data at their disposal to identify the gaps in the market and create agile brands focused exclusively on delivery to meet unfulfilled consumer demand.

“However, this trend has not been uniform, with companies like Just Eat sticking to their original function and positioning themselves as reliable partners for small and medium-sized foodservice providers. This side of the market may expand its offering for foodservice brands soon, offering additional features including conversational platforms. This would allow SMEs that cannot develop AI capabilities to take advantage of what these technologies have to offer and benefit from becoming part of a larger infrastructure while retaining their local and authentic character.

“The change in business model, accelerated by the pandemic, is here to stay, and aggregators are the clear winners. Larger foodservice companies, with the data and capital necessary to make the relevant investments, have tried to develop their own delivery capabilities, but even major brands, such as McDonald’s and Yum! Brands, eventually opted for strategic partnerships. While the high delivery fees and lack of ownership of customer data are considerable drawbacks, food aggregators offer an opportunity that neither SMEs nor big brands can refuse.”

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