Deliveroo’s Orders Drop by 7 Million as Consumers Cut Back


Aggregators in the food delivery space are feeling the heat from rising prices worldwide, as consumers start to cut back. United Kingdom-based food delivery aggregator, Deliveroo, shared in its first quarter financial report on Thursday (April 20) that its orders dropped by 7 million YoY, falling from 79 million to 72 million. Additionally, the average monthly consumers decreased by 500,000 during the same period, from 7.6 million to 7.1 million. Deliveroo’s CEO, Will Shu, said in a statement, “Revenue growth of 4% and broadly flat GTV (both in constant currency) represents a resilient performance, particularly in the context of inflationary pressures and the ongoing cost of living crisis and against a challenging comparison base.” Shu also added that the company remains confident in its ability to deliver on its plans to drive profitable growth and sustainable cash generation.

The news comes on the heels of Just Eat’s announcement that in its most recent quarter, orders fell by 14% YoY from 263 million to 228 million. However, unlike Deliveroo, the Netherlands-based aggregator attributed this decline to the continued impact of the pandemic. On the company’s earnings call, CEO Jitse Groen argued that the impact of the cost-of-living increase is immeasurable.

However, PYMNTS research shows that consumers do indeed cut back on food delivery orders when prices rise. According to the February study “Connected Dining: Rising Costs Push Consumers Toward Pickup,” which surveyed a census-balanced panel of over 2,100 US consumers in January, almost half of all consumers (48%) have become more likely to pick up their restaurant orders themselves rather than have them delivered because of inflation.

As such, aggregators must find ways to lower costs for consumers, despite the already narrow margins of the model. Tony Xu, CEO of leading US aggregator, DoorDash, told analysts on the company’s most recent earnings call, “On the affordability side, we’ve taken down transaction costs for consumers by about 8% in the past year, and we’re always trying to drive this down. When it comes to affordability, certainly, DashPass [the aggregator’s delivery subscription] has been a big driver, but at the same time, we’re working on quite a lot of other initiatives as well to make sure that we can keep making the service more and more affordable.”

According to research from PYMNTS’ study, The 2022 Restaurant Digital Divide: Restaurant Customers React to Rising Costs, Declining Service, the vast majority of diners have made changes to their restaurant spending in response to rising prices. The study drew from a survey of over 2,300 consumers who regularly purchase food from restaurants. It revealed that 88% of millennials and Generation Z consumers, 87% of bridge millennials, and 85% of Generation X consumers reported making such changes, with three-quarters of baby boomers and seniors also making adjustments to their restaurant spending.

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