Lumina Intelligence explores whether the dominance of savoury food in delivery is about to be disrupted by the growth of sweet treats
Foodservice delivery in the UK has been one of the few pockets of growth across the hospitality sector in the past two years. From 2019-2022 the UK foodservice delivery market is expected to have grown by +74% - equivalent to £5.7bn in absolute terms [1]. Exponential growth has been spearheaded by an abundance of supply side availability, where just about any food type or cuisine can now be obtained through delivery. As more options become available across the market, there is a new opportunity emerging around sweet food.
Savoury food still makes up the bread and butter, with 91% of delivery occasions including savoury options [2]. However, this is falling year on year with occasions involving sweet foods increasing to 17% in 2022 [3]. Initially, the uptake of delivery among low ticket channels, most notably traditional fast food, saw consumers opting to increase delivery values and overcome delivery fees through add-ons.
The group of consumers adding dessert items to meals offers a great opportunity for operators to boost spend. This can be bolstered through end-of-order call to actions to encourage users to complete their meal with a dessert. More recently, the growth in sweet and snack food ordering in 2022 indicates that consumers are now opting to order this category of food as standalone delivery. Desserts via delivery hits many consumer trends currently driving recovery in the out of home market, such as increased treating, value for money scrutiny and customisation.
The emergence and continued success of dessert parlours in the UK has ridden off consumer trends for experience-led dining, treating and younger consumers or families wanting to enjoy socialising without alcohol. Growth among the two market leaders, Creams Café, and Kaspa’s Desserts, has outpaced physical expansion seen in the market for the past seven years [4].
Treating remains a leading driver of delivery occasions, with 19% of occasions driven by a consumer wanting a treat. Ice cream, cookies and chocolate confectionary are now appearing among the top food categories ordered for delivery (where chips, burgers and pizza dominate) and Ice cream/sorbet is the fifth most popular item ordered through Uber Eats, an aggregator that holds a 21% share of occasions. Treating is expected to increase as a driver in the eating out market in the next year, with many consumers faced with smaller living budgets and forced to cut spending on higher spend commodities and experiences.
In the face of the cost-of-living crisis, good value for money is becoming more important to consumers when ordering delivery. Operators can boost value for money credentials through including dessert items in meal deal packages and offering discounts on larger orders. Meal deal bundles will be especially popular with families and these households are valuable as they spend on average +6% more on food and +14% more on drinks for delivery. Family-led occasion messaging, for example around half-terms and seasonal holidays, should be utilised to target these households.
Foodservice delivery in general is in a favoured position as the UK approaches its most challenging economic period in the past 30 years (if going by inflation). Through Lumina Intelligence’s psychographic measures, it was found that price-led consumers over-index in restaurant delivery occasions vs dine-in, indicating that delivery is also seen as a more budget friendly way to enjoy eating out, at home. Price is also less of a barrier to ordering delivery, than when purchasing out of home (38% vs 50%), furthering the notion that delivery is seen as a more budget friendly option.
The opportunity for dessert food delivery is a promising one, with sweet and snack food ordering highest amongst the 18-24 age group, a demographic that has continually over indexed in delivery. Although chains will be faced with challenges around health credentials amid calorie legislation; careful messaging around treat occasions, driving value for money with meal deal options and offering additional customisable toppings will allow operators to capitalise on this sweet opportunity.
[1] Lumina Intelligence UK Foodservice Delivery Market Report 2021
[2] Lumina Intelligence, Eating Drinking Out Panel
[3] 12 WE 23.01.22 vs 13% 12 WE 24.01.21 -Lumina Intelligence, Eating Drinking Out Panel
[4] Lumina Intelligence Operator Data Index
