The rise of food delivery technology and how your brand can keep up

Discover seven trends in the food delivery industry and how conversational AI can help improve customer and driver experiences.

Senior Content Marketing Specialist

Dave Hitchins

Senior Content Marketing Specialist

The phenomenal global growth in the meal and grocery delivery market has been driven by the perfect storm of the Covid pandemic, the rise of the gig economy, and technological advancements in messaging apps and AI. 

According to research carried out by Oracle Food and Beverage in 2020, 40% of companies within the food sector have already implemented AI. The world’s AI food and drink is predicted to expand by an annual rate of 19 percent from 2020-2025 and will reach $5.9 billion in 2025. 

The latest trends in the food delivery industry are showing that companies are starting to implement AI more often to: 

  • Enhance efficiency of their service
  • Offer better customer service
  • Lower expenses
  • Boost revenue

Let’s walk through seven of the latest tech trends in food delivery, and how brands can ensure secure and safe communication with delivery drivers and users alike. 

What are food delivery services and why are they so popular? 

In a few years, the food delivery landscape has undergone a remarkable transformation. Previously, the only food that you could get delivered to your home was a pizza, which was great if you liked pizza and weren’t watching your calories, but if you wanted something healthier or a bit more sophisticated you would need to travel to a physical restaurant which would involve getting dressed and dealing with actual people. Sometimes we crave food but are just not in the mood.  

All that has changed, and in most big cities apps like Uber Eats, DoorDash, and Grubhub will deliver delicious hot food from your favorite restaurant directly to your door, for what seems like a trivial fee.  

But the evolution of food delivery services isn’t exactly slowing down. Thanks to AI and new emerging technologies, we are seeing new trends and capabilities that are changing the way we order our food.

Trends in the food delivery industry  

Last mile food delivery  

In the transportation industry, last mile delivery refers to the very last step in the supply chain process where an item is delivered to a person’s home or a retail store. From a customer’s perspective this is the most crucial stage as it is when they get the product in their hands and can check that it is what they ordered and that it is in the expected condition.  

Last mile food delivery is even more important due to the nature of the product. A delivery window from 2pm to 8pm might be acceptable for getting a sofa delivered, but it certainly wouldn’t be for a hot meal.  

How to stand out:

Food businesses that deliver must ensure they can optimize their supply chain to hit very narrow delivery timeslots. This is only possible with the aid of technology.  Conversational AI is used to enhance this part of the journey with real-time tracking and predicting busy times that can make deliveries faster and more reliable. By adopting Conversational AI, businesses can consistently provide quick and high-quality service, keeping customers happy and coming back for more. 

Virtual restaurants and kitchens  

A virtual restaurant is not a restaurant in the conventional sense as you can’t visit it and sit down for a meal. Also known as ghost kitchens or cloud kitchens, it is a food provider that serves customers exclusively by delivery and pick-up, with people either ordering by phone, through an app, or via the business’s website.   

What started off as a way for conventional restaurants to stay in business during Covid lockdowns has grown into a unique industry that benefits from lower staffing requirements and reduced operating costs with built-for-purpose kitchens located in low rent areas with good access to transport links.  

Crucial to the success of virtual kitchens has been the development of conversational AI into apps that make the ordering, preparation, and delivery of food simple and transparent. These work by linking the customer, kitchen, and delivery process into a seamless workflow that can easily adapt to unexpected factors.  

Imagine a virtual restaurant called “Flavors Without Borders.” It operates from a ghost kitchen located in a busy urban area. Customers place orders through the restaurant’s app or website. Specialized software manages the entire process, from order placement to delivery.

If a customer orders a popular dish like the “Mediterranean Grilled Chicken” and the kitchen runs out, the dish is immediately removed from the virtual menu. If a delivery driver encounters traffic, real-time updates are sent to both the customer and the kitchen to adjust expectations. And if a customer decides to have a picnic in the park instead of being at home, the driver receives the updated delivery location through geo-coordinates.  

How to stand out:

Food businesses that deliver must ensure they can optimize their supply chain to hit very narrow delivery timeslots. This is only possible with the aid of technology.  Conversational AI is used to enhance this part of the journey with real-time tracking and predicting busy times that can make deliveries faster and more reliable. By adopting Conversational AI, businesses can consistently provide quick and high-quality service, keeping customers happy and coming back for more. 

Contactless food and grocery delivery  

Food deliveries are known to be contactless when there is no physical interaction between the customer and the delivery driver. It has proved to be a popular and cost-effective way of getting food delivered and certified without having to sign anything to confirm receipt. This provides the health benefits of removing physical contact and reduces the hassle of arranging an exact delivery time as groceries can be left in a safe place specified by the customer, or in a locked storage receptacle that the customer can retrieve at their leisure.  

Depending on the circumstances, there are several ways of solving the problem of confirming that the delivery has taken place, and that the correct person has taken it.  

  • If the customer is at home, they can scan a barcode on the food packaging with their phone in the presence of the driver and this can serve as a digital signature.
  • If the customer has specified a ‘safe place’ to leave the delivery, the driver can take a photo which is automatically visible in the customer’s app with a push notification sent to let them know.
  • To prevent the wrong person from claiming the delivery, the app can include face recognition capability that the driver can use to make sure that they are handing the food to the correct person.
  • The geo-location data of driver’s phone or vehicle can be used to trigger an SMS or app message to the customer that they have visited the specified address.

How to stand out:

You can allow customers to order and interact with an AI chatbot on a chat app to keep the journey smooth and avoid moving between apps and windows. This way a customer can see delivery information, ask a chatbot for a status, and see the completion of delivery all within the same chat app. Applying the AI chatbot streamlines the confirmation process and enhances the overall customer experience. 

Food delivery tracking  

Time seems to slow down when you are hungry and waiting for a food delivery to arrive. Rather than phoning up the business and possibly distracting them from finalizing your order, the best apps with integrated conversational AI provide real-time delivery tracking so that you can see the status change as the order is accepted, prepared, and dispatched. You should then be able to see a map showing the location of the driver, so you know when it is safe to get out the plates and cutlery.  

How to stand out:

Implemented AI chatbot helps your customers to seamlessly track their food delivery within one chat app on demand. Chat apps are intuitive and familiar, allowing your customers to easily access tracking information without navigating through complex menus. By personalizing messages and providing relevant information tailored to each customer’s order, you are more likely to have customers coming back and ordering again thanks to an excellent customer experience. 

Ordering food by chatbot  

If you have tried browsing a conventional restaurant menu on your phone that has simply been scanned and uploaded as a PDF, you will know that it doesn’t make for an easy or quick experience. Online menus that have been optimized for mobile are a step in the right direction, but what is really useful is a chatbot that can provide a more flexible and ‘human’ ordering experience.  

“I’m in the mood for chicken and I’m very hungry, what can you suggest?”  

The chatbot can then display meals that fit the criteria of chicken + large portion and can even show photos and suggest alternatives.  

“If you are really hungry and in the mood for poultry, why don’t you try our festive turkey special?”  

With a chatbot you can provide all sorts of extra information that would just clutter up a conventional menu – nutritional information, where ingredients have been sourced, and even reviews from other diners are just a few ideas.  

The customer could even provide a delivery address and provide payment details without even leaving the chat app. Updates on the order and delivery status can also be sent automatically in the chat.  

How to stand out:

Conversational AI technology can make it easier and faster for your business to collect customer data so that you can use it to build detailed profiles and send menu recommendations, or notifications when a favorite restaurant is having a deal or special offer.  

Food delivery by drone  

If you thought that this was a fantastical idea that would never work in practice, you would be wrong. The Chinese delivery giant Meituan has been using drones to deliver food orders for almost two years.

“Look, up in the sky, it’s your dinner!”

Flytrex

Drone delivery company slogan

To avoid the regulatory minefield that has bogged down Amazon’s plans for package delivery by drone, Meituan doesn’t have the drones deliver directly to customers address, but to pick up kiosks dotted around the city. These set routes make the task of navigating urban areas much easier.

In the US, startups like Flytrex are gradually rolling out food delivery by drone with the catchy slogan “Look, up in the sky, it’s your dinner!”. The area they cover is currently very limited but expect to see the service available in more areas as technology and local legislation catches up.

How to stand out:

Having a drone delivery service already makes you stand out. But consider how the experience would look to the customer. Would they have the same tracking abilities as when a driver is delivering their order? Who can they talk to when something is wrong with the delivery or food? With the right machine learning and algorithm training, conversational AI can make any customer journey efficient and easy for your end user – even in uncharted territories like drone delivery. 

Driver and employee AI powered assistance  

Food delivery brands have many employees, from cooks, managers, and delivery staff. It can get challenging for these brands as many drivers can clock in and out at their convenience and are delivering massive amounts of orders at all hours of the day. By introducing an AI powered chatbot specifically designed to assist employees, you can make it easier for them to: 

  • Log their hours and routes
  • Ask details about their most popular dish
  • Submit complaints
  • Request time off
  • Get details on safety procedures
  • Ask for IT support on POS issues

How to stand out:

To have 24/7 availability to provide support and assistance to your employees and drivers in the shape of a digital AI assistant is a huge benefit and a relief for employees and drivers who for example have language barriers. It is a great convenience to have all the information needed as an employee in your native language to avoid confusion, reduce errors, and be prepared for any challenge. And for drivers who work all hours of the night, perhaps when employee service agents are not working, this continuous support ensures that they can always get the help they need, regardless of the time of day. This way businesses improve employee experience, and demonstrate a commitment to technological innovation and excellence. 

Ensuring the safety of customers and drivers

We have dealt with this subject in detail in our recent blog on ensuring safety in the food delivery and ride hailing industries.

We cover a number of the technology tools that ride share and food delivery companies can use to ensure the safety of both customer and drivers. These include:

  • Number masking: Number masking enables two-way voice calls, without exposing each person’s phone number. This ensures secure and convenient calling between customers and drivers for necessary updates like ‘I’m caught in traffic’ or ‘Please knock as the doorbell is broken’.
  • Multi-factor authentication: When recruiting new drivers and signing up new app users it is crucial that the company is able to confirm that the person is who they say they are. The most efficient way of authenticating large numbers of app users is with an automated process that sends a one-time pin code (OTP) on a verified channel like SMS or WhatsApp as part of a 2FA verification process.
  • Automated identity checks: An effective first step in driver vetting process is to do an automated identity check using the person’s driver’s license and a selfie that they submit. Facial recognition AI is used to automatically detect that the photo matches the license.

Elevate customer and driver experiences with food delivery trends

The food delivery industry is undergoing a remarkable transformation with emerging trends changing the way people order food. Conversational AI technology stands out as a game-changer, offering brands an unparalleled opportunity to differentiate themselves in a highly competitive market. By leveraging AI-powered chatbots and virtual assistants, businesses can enhance experiences for both customers and employees (from drivers to cooks). Embracing these innovations not only meets the evolving expectations of consumers but also positions your brand at the forefront of the industry. As the landscape continues to evolve, staying ahead with cutting-edge technology and a customer-centric approach will be key to long-term success in the dynamic world of food delivery. 

Ensuring the safety of customers and drivers

Discover a number of the technology tools that ride share and food delivery companies can use to ensure the safety of both customer and drivers.

Safety in food delivery

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Jun 11th, 2024
11 min read
Senior Content Marketing Specialist

Dave Hitchins

Senior Content Marketing Specialist