Credit: UberEATS

Uber's hungry for success with its new food delivery app

The taxi company is rolling out UberEATS across cities worldwide. Should the likes of Just Eat and GrubHub be worried?

by Rebecca Smith
Last Updated: 08 Jun 2016

Never one to sit still for too long, Uber’s announced its latest expansion plans – but they’re probably not what you expected. This isn’t the ride-hailing app’s typical aggressive push to unsettle yet another country's taxi drivers. Instead, it's extending its tentacles into food, launching its delivery service UberEATS across six US cities, Paris and Melbourne in the coming weeks.

Now Uber’s not known for being a shy and retiring company – it shows off its bruising approach to expansion with pride. So it’s not really a surprise that the company isn’t too daunted about trying to create a space for itself within the crowded food delivery market.

It also signifies the company’s desire to expand across the logistics industry. Soon it won’t just be cabbies worldwide taking umbrage with Uber’s hoovering up of their business. Uber founder Travis Kalanick has discussed his desire to create a logistics network that is ‘as reliable as running water, everywhere for everyone’. Whether that vision comes to fruition remains to be seen, but UberEATS is an important piece of the puzzle. 

The success of the app isn’t guaranteed. Uber experienced a few roadbumps when it first experimented with the food delivery space back in 2014 and soon realised ordering food was different to requesting a car. Uber says it’s learned from that and UberEATS is now being unveiled as a standalone mobile app, allowing lunch or dinner deliveries.

As with Uber cabs, you track the driver as it makes its way to you with the food. UberEATS has a flat delivery fee of $5 (£3.50) and the company says there won’t be a hidden service charge or its notorious surge pricing. To do that, Uber restricts options to show restaurants within a delivery radius to make it possible to deliver food quickly, still in good nick.

Still, some might question whether it’s a belated move. VC investors’ appetite for delivery services appears to be waning after a surge in funding during the past couple of years. You’d wager that it’ll be smaller firms that suffer here though – Uber’s got the investment behind it to do what it does best and make a considered, aggressive push into new territory.

The likes of GrubHub, Postmates, Sprig and even Just Eat might feel the heat. There’s no reason to say people won’t download more than one food delivery app; customers like choice when it comes to food after all. But service will have to be ever more consistent – as users will know there’s all manner of alternatives waiting to gobble up their custom should an app disappoint.

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