I strongly believe that the food and grocery delivery market are starting to be red oceans. Competition is tough, consolidation is happening quicker than most anticipated and the question of differentiation and customer retention is becoming more and more relevant.

The topic of differentiation online is very important not only for aggregators like Uber Eats and Deliveroo, but also for the restaurants themselves, as eaters are sticking to online ordering and maintaining omnichannel operations (online booking, pick up, food delivery) is becoming a new industry standard.

User-generated content (UGC) has revolutionized the way brands interact with their customers, creating unforgettable moments that leave a lasting impact. From heartwarming testimonials to viral videos, UGC has given more ways to communicate with different audiences, unite the community of loyal customers and build a strong brand.

Statistics indicate the significant impact of UGC on brand performance:

• Increased Web Conversions: Companies featured on user-generated content saw a remarkable 29% increase in their web conversions, demonstrating the effectiveness of UGC in driving customer actions and engagement.
• Widely Adopted Strategy: An impressive 86% of companies have incorporated UGC into their marketing strategies. This overwhelming majority recognizes the value of UGC in building trust and authenticity for their brands and businesses.
• Engagement and Trust Building: About 72% of brands believe that UGC helps them engage customers and build brand trust. By leveraging UGC, brands can establish a genuine connection with their customers, ultimately impacting conversion rates positively.
• Consumer Preference for UGC: A staggering 90% of consumers find user-generated content useful and place more trust in what existing customers say about brands compared to traditional ads and promotional emails. This preference underscores the authenticity and relatability of UGC.
• Furthermore, UGC can significantly enhance the effectiveness of call-to-action campaigns. When UGC is utilized as a call-to-action and encourages people to click on ads, a remarkable five-fold increase in click-through rates has been observed. This highlights the persuasive power of UGC in capturing audience attention and driving desired actions.

Thousands of fans attend MrBeast Burger restaurant opening in New Jersey (Image via MrBeast/Twitter)

Content creation in marketing is a must! And we see that with Youtubers like Mister Beast opening their Virtual Restaurant Brands and capturing the market. David Dobrik is getting his Doughbriks Pizza viral collabing with Snapchat on AR filters getting his fans crazy on social media and motivating them to create more content interacting with his pizza brand. Here you can read more about more cases on the topic. 

Consumers respond best to content that’s authentic, and nothing is more authentic than user-generated content.

For aggregators, there are 2 types of UGC: content coming from the listed businesses and content coming from end users. Both are important and actually have the same execution bottleneck. 

For the content generated by the restaurant partners, aggregators use different strategies to ensure quality photos, as content directly affects the user time on the app and conversion. Some, like Glovo, are offering professional photoshoots for restaurants through their company portal. Others are looking at tackling the large volume of this type of UGC head on by implementing AI solutions to control for quality and enhance photos directly from restaurant owners.

Source: OCUS

“AI-driven image processing accelerates food image analysis, processing images up to 10x faster than manual methods. It enhances decision-making, improves accuracy and consistency, and optimizes for conversion, all while being cost-efficient and scalable. At OCUS, we are seeing our client use our AI solutions to either completely replace costly manual interventions or work alongside image processing teams to drastically increase their efficiency.” – Thibaud Lemonnier OCUS CEO. 

It is important for food delivery companies not to only differentiate from competitors, but get closer to the customer and be even more customer centric at scale. The task is not easy to crack and there is no golden key, it is rather a puzzle, because for example in Brazil alone, iFood geography is huge and growing and you have different groups of customers you need to reach. Just imagine the task for the global player covering dozens of markets. 

Authenticity is a word that gets used a lot in marketing, but there’s a reason everyone is talking about it. Customers relate most to marketing content that seems genuine rather than salesy. 

At the same time engaging with users as well as partners is very important. As the amount of content on the internet is growing every minute, businesses need more streams of content and more voices. And here comes the second type of UGC. 

For example Zomato’s new initiative of collaborating with home chefs under the tagline “joining hands with its competition” is a clever move that has the potential to benefit both the company and the home chefs as well as users for whom content will become more personalised and engaging. 

By encouraging home chefs to post pictures of their homemade dishes, Zomato can generate a significant amount of UGC, which can help in promoting the brand on social media platforms.

It also makes content more personal and engages deeper with the audience as collaborating with home chefs will give Zomato access to a wide variety of authentic dishes that are unique to different regions and cultures coming from original voices. This will allow the company to offer a more personalized experience to its users. Read more about Zomato marketing strategies here.

Doordash is exploring the creator economy partnering with micro influencers to repeatedly create UGC which is used in targeted campaigns as well as direct influencer marketing.

To manage either type of the two UGC at scale, new technologies definitely need to be leveraged. This is where both myself and large aggregators see strong use case for emerging AI technologies. 

And what are your thoughts on the topic?