Uber is expanding its business and looking to be a part of the huge grocery and convenience store business.
There is a bit of an eCommerce ‘moment’ that is happening at a local level. That’s a lot of what we are investing behind here – Jason Droege, head of Uber Eats
He further added, “I can shop almost everywhere outside of a city through my phone or my computer but it’s actually pretty hard to shop the merchants in my city. Eats, in one way, is a restaurant delivery service. In another way, we are solving customers’ dining needs. If you abstractly think about it that way, grocery stores and restaurants are serving a lot of the same needs.”
Uber Eats had become an important part of the company’s revenue with its $595m benefit, and its growth of monthly active customers to 140 percent when compared to last year. Earlier this year, Uber in Australia tested this method of delivering both cooked meals and staples from the grocery chain, Coles.
After its success, Uber is looking into the supermarkets of Europe, and North America to do the same. Uber had also joined hands with Nestle and Unilever for delivering packs of coffee, ice cream, and baby supplies to people in countries like Belgium and Brazil. With the help of Uber Eats some cinema chains in Australia have also delivered fresh popcorns to people sitting at their home.
Uber has not given an exact date as to when this service would be open for business but Mr. Droege mentioned that it would be soon.
Businesses that operate locally are realizing that eCommerce is or can be an effective channel. I think that actually the conversations we’ve had with some of these potential partners have been really encouraging in terms of how to work together to bring them online – Mr. Droege
If Uber decides to open shop delivering groceries, it would be competing against giants like Amazon and other similar grocery delivery systems available worldwide. Mr. Droege mentioned, “We are in building mode right now. Uber is a company that builds first. Eats is in that same vein.”
The delivery sector is becoming one of the fastest-growing systems all over the world. On-demand delivery apps say they are attacking the $2.8tn global restaurant market and another $6.3tn spent in grocery stores.
However, the question of profit remains wide open as most of the delivery companies use incentives, and loss-leading delivery fees so that they could win market share. Now only time will tell the whole story of Uber’s profit if it ever gets any.