The Associated Press reports this morning that "Uber’s food delivery business brought in more money during the third quarter than its signature rides business, showing just how much consumer behavior has changed — and how far the company has adapted — since the pandemic struck."
According to the story, "Uber brought in $3.13 billion in revenue, down 18% from the same time last year. Its mobility business, which includes ride-hailing, scooters and bikes, accounted for $1.37 billion of that, down 53% from the same time last year. Despite the decline, the rides business showed improvement from the second quarter, when it brought in just $790 million."
But, "Uber’s Eats business generated $1.45 billion in revenue, up 125% from a year ago as restaurants relied on Uber for delivery and the trend of people ordering in instead of dining out during the pandemic continued … Uber Eats continued to add restaurants to its app, and its partnerships with restaurants grew by more than 70% compared with last year. It also added a contactless payment feature to allow customers who are dining in restaurants to order or pay using their Uber Eats app.
"Uber also expanded its grocery delivery service, which is now operating in 10 countries outside the U.S. It also launched a prescription drug delivery pilot program in Dallas and Seattle."
- KC's View:
There's just one problem: as the AP writes, Uber's "rides business was more profitable than delivery."
I wonder if it might make sense for Uber to develop a delivery business that would allow its retail clients to private label it - while Instacart provides infrastructure, retailers would have a greater sense of ownership. Could this be a way to generate greater usage, especially if they could come up with a new cost-sharing formula that would benefit both parties?