Why Uber matters in food

Aug 29, 2014by Phil Lempert in Viewpoints

I’m sure you have noticed how Uber has upped the game in same-day delivery, social media, mobile payments — and food.

An upstart that was born in San Francisco in 2010 that is very focused, organized and well-funded, Uber is now operating in 170 cities in 37 countries to the tune (according to TechCrunch) of $213 million (which represents over a billion dollars of bookings; Uber collects 20% commission on all receipts).

Why should food retailers care?

On July 18, Uber conducted a special “promotion” across six continents — selling and delivering ice cream!

Not only is this six-hour event a brilliant social media play (check it out at #UberIceCream) where people throughout the world added happy photos and praise for Uber with smiles on their faces, of course…it’s ice cream!, it is proof that Uber will be on location on demand within minutes. This event was step one to add a new dimension to the same day delivery business that is being led by Google Express and Amazon. Let’s not forget that Uber is in the transportation business; while for Google this move is yet another extension for worldwide dominance to satisfy all consumer needs.

Next, Uber announced their “Corner Store” introduction in Washington D.C. followed by restaurant delivery in Santa Monica, Calif.

I am intrigued by another side of their move into food — mobile payments. Uber’s email invites point out that “no cash needed — your order will be billed to your Uber account,” obvious for Uber users who are already comfortable with using (and trusting) Uber’s mobile payment system. And trusted it is. Seeing the driver’s car location, their photo and license plate number way before you enter the automobile has done a lot to reinforce trust. Moving beyond just transportation propels Uber as a proven and tested mobile payment provider ahead of the others (with the exception of Starbucks) who have been struggling to move mobile payments mainstream.

Food retailers may question the long term consumer desire for same day, on-demand delivery and whether it may just be a novelty or passing fad; however, I see it as changing the way shoppers will plan their meals, and buy prepared foods. Uber will have a huge negative impact on both fast food and casual dining, and help customers move to an almost daily acquisition of foods.