Weighing Convenience vs. Price for Food Delivery Subscriptions

Revel Blog | Sydney Kida | December 22, 2022 |

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In spite of many shifts in the marketplace and in consumer preferences as of late, convenience continues to reign supreme for consumer spending behavior. One area where that translates meaningfully for food brands is that of delivery.

In fact, as reported in a Restaurant Business article by Jonathan Maze, restaurant spending is up 14.1%, over the past year according to federal data. Menu prices were up 8.5% in November, which means there is 5.6% of organic growth in food away from home.

Furthermore, in a Technomic Consumer and Operator Outlook study, Technomic Associate Principal Lori Rakoczy reports that a lack of energy for cooking, and therefore, a high priority on convenience, continues to be the top motivator for people deciding whether or not to order from restaurants. 

Ultimately, that means there’s still a healthy consumer appetite for food delivery. With so many varied options now available for meal delivery service, one option for operators to consider is the value of food delivery subscriptions. 

Unpacking Food Delivery Subscriptions

You may be familiar with meal subscription services like HelloFresh and Blue Apron. For a recurring fee, subscribers are shipped pre-packaged and pre-portioned ingredients to their home, which they can then assemble and cook with minimal thought and without regular trips to the grocery store. 

While these services make it easier for people to cook meals at home, they aren’t a perfect solution for the finding in the Technomic study, where many people don’t have the energy to cook at home at all. An alternative option to these healthy food subscriptions for meal prep is an online food delivery solution like Uber One (by Uber Eats delivery), a Dash Pass (by DoorDash delivery) or other food delivery services for hot-and-ready restaurant meals. 

When it comes to the question of “which food subscription is best?” the answer could be a combination of more than one option. In many cases, the decision comes down to convenience vs. price. 

Food Delivery Apps: Convenience vs. Price

Many consumers have accepted app downloads as a standard practice now, but it’s still a big deal for a brand—any brand—to claim prized real estate on a mobile device as a downloaded application. 

For meal prep subscriptions and third-party delivery for takeout restaurants alike, the price must be worth the added convenience for a consumer to faithfully download and use a dedicated app for the service. 

Health-conscious consumers may still opt for a healthy meal subscription over food box delivery from a restaurant. However, some restaurants do offer healthy menu items, and with them, the added convenience that zero food preparation is required for the meal. 

The best food subscription options will vary from household to household, but a constant in addition to convenience is consumer preference for choice. As a restaurant operator, you may benefit from a hybrid delivery solution, offering multiple third-party delivery options in addition to an in-house delivery service, in order to appeal to the widest possible market. 

Could Subscriptions be the Next Phase of Restaurant Loyalty?

Meal subscription services and meal delivery kits are familiar concepts for most households at this point. But for restaurants, unlocking the next big opportunity for guest loyalty is a pursuit that’s constantly under way. 

Some notable brands, including Panera, for example, have deployed membership programs to attract, engage and retain loyal customers. Having fresh meals delivered on a recurring basis via a subscription service could be a great balance between a family’s demanding schedule and a restaurant’s guest retention strategy. 

One key benefit of a subscription model is that it can be predictive. Operators wouldn’t have to guess, but rather, would be able to anticipate demand from a large segment of customers and stock and staff accordingly each week. 

Subscription services could also build on the meal kits made briefly popular by pandemic restrictions, offering a blended approach to family interaction and kitchen demands. While these are no longer among the lone options for restaurant food as they were during lockdowns, they could be a cost-effective option for keeping your guests engaged and satisfied. 

Returning to the Panera subscription example, another angle is to offer a subscription for a low cost, readily available product like coffee. In Panera’s Unlimited Sip Club, members can sign up and enjoy unlimited coffee and fountain drinks for a flat monthly fee. 

Of course, the upside to this type of subscription is that patrons regularly visiting the chain will likely add to their order when enjoying their bottomless beverages. Similar to add-on potential with gift cards, where redeeming patrons are more likely to overspend rather than leave a fraction of the prepaid card unspent, this type of subscription costs operators very little to provide, helps encourage loyalty, and inspires order additions when guests engage with your brand. 

An occasional prepared meal delivery, perhaps with the delivery charge waived, could be a loyalty benefit subscribing members enjoy when they reach a certain spending threshold with your brand. 

So, Which Option is Best?

Unfortunately if you sought a direct answer to that question you will be disappointed, as it’s this author’s opinion that the right approach to home delivery meals will vary significantly from brand to customer. 

With that said, hopefully this blog post gave you proverbial food for thought and some viable alternatives to the frozen food delivery many have come to accept as the main option for food delivery subscriptions. 

Of course, a critical element in any delivery approach is the right tech stack, one designed to meet the needs of your customers within the parameters of your restaurant operations. If you haven’t already done so, explore Revel’s solutions for food delivery. Our cloud infrastructure can support native delivery for your POS platform, seamlessly integrate with a third-party solution, or offer you a hybrid of the two. With the right solution in place, you’ll be able to vastly expand your restaurant’s footprint and retain even more hungry guests.