Uber eats‘ Q4 2022 performance surpassed analyst predictions, with gross delivery bookings rising 14% YoY to $14.3 billion and delivery revenue jumping 21% YoY to $2.9 billion. Delivery accounted for 34% of Uber‘s total revenue, and the company’s ongoing investment in non-restaurant delivery categories like grocery, convenience, and alcohol could drive further growth.
A key factor behind Uber eats‘ success is the Uber One subscription offering, which bundles Uber eats and Rides services and provides $0 delivery for $9.99 a month. About 40% of Uber eats bookings in the U.S. come from Uber One, according to CEO Dara Khosrowshahi who said, “Delivery remains resilient.”
The program’s membership count nearly doubled in 2022 to around 12 million, boosting user loyalty, spend, and frequency. Dara Khosrowshahi highlighted that “Uber One members spend roughly four times more than nonmembers monthly, with 15% higher retention.” Although new members initially cost Uber due to the discounts offered, the long-term value generated from membership creates a significant growth opportunity.
Cross-promotion between Uber‘s mobility and delivery services is also a strategic advantage. Khosrowshahi added that the company plans to use artificial intelligence and machine learning to create additional upselling and cross-selling opportunities.
The bundled subscription model’s success could attract more restaurants to Uber eats platform, as it offers a unique combination of rides and delivery services. With only 25% of merchants currently active in advertising, Khosrowshahi sees substantial potential for growth in the advertising business, targeting $1 billion in revenue by 2024.
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