Amazon Is Gaining In The Online Food Delivery Space

Posted: Apr 18, 2017

Source: Benzinga, Inc.

AMAZON not one to let go of any opportunity without a real fight despite its dominant positioning in the online marketplace. This could be one of the reasons that the company has seen staggering growth over the years.

Now, news has it that Amazon is making meaningful headway in the online food delivery space.

Loop Capital Markets confirmed this in a note Monday, with its latest consumer survey indicating that Amazon Prime Now has gained brand recognition and recent usage for online food delivery relative to GrubHub Inc GRUB 2.03%

The survey consisted of 502 U.S. consumers aged 18+.

Brand Recognition Up Solidly

Analyst Blake Harper explained that Amazon Prime Now has captured the top spot in his survey results for aided recognition and recent usage, ahead of GrubHub/Seamless.

Amazon has gained in brand recognition, with 39 percent of the respondents recognizing the brand in March compared to 34 percent in December 2016.

Meanwhile, GrubHub's percentage declined to 38 percent from 40 percent a quarter ago. UberEATS, ranked third, has recognition from 26 percent of the survey respondents, up from 23 percent in December 2016.

Yelp Inc Eat24's recognition remained unchanged at 18 percent, while Groupon Inc has improved brand recognition by 2 percentage points to 14 percent.

Recent Use: Amazon Pips Past GrubHub

Amazon also scored better on recent use, defined as the number of respondents using the online food ordering services in the past three months. On recent use, 20 percent of the respondents confirmed recent use in March 2017 compared to 16 percent in December 2016.

Meanwhile, GrubHub saw the percent decline to 17 percent from 18 percent and Yelp's Eat24 held steady at 8 percent on this metric, while OrderUp saw an improvement to 8 percent from 6 percent.

Majority Of Growth To Go To Amazon

"We continue to see the majority of the market growth going to Amazon, GrubHub, and UberEATS over the next several years, with Yelp Eat24 eventually constrained by its lack of integrated delivery," Loop Capital Markets said.

"We believe the smaller players will continue to struggle to reach scale and profitability."

By Shanthi Rexaline
April 17, 2017
Source: Benzinga

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