BRACE YOURSELF FOR A MASS EXODUS OF EMPLOYEES

Restaurants struggling to hold onto their employees are about to hit by a major setback, according to new research.

A survey of 13,659 wage earners by the online job marketplace Joblist revealed that 58% of restaurant and hotel employees intend to quit their jobs by the end of the year, stoking what the researchers have dubbed The Great Resignation.

If the pattern set by earlier quitters persists, a fourth of the workers will leave the hospitality industry for good.

The employees who intend to bail are in addition to the 16% of industry respondents who indicated they’re already no longer working.

The overall driver is the individuals’ dwindling satisfaction with their positions, the study found.  The proportion of workers turned off by their hospitality jobs has doubled during the pandemic to a third of the labor force, compared with the 15% who said they were dissatisfied before the coronavirus crisis.

The percentage who said they’re satisfied with their positions dropped to 42%, from a pre-pandemic benchmark of 64%.

“Such extreme levels of employee dissatisfaction will likely lead to a wave of resignations in the near future,” the Joblist study states. “This is a strong signal that the labor shortage affecting the hospitality industry might get worse before it gets better, as increased turnover exacerbates an already difficult hiring environment for employers.”

Among the 25% of former hospitality workers who said they’re done with restaurants, bars and hotels, the leading source of their dissatisfaction was low pay (cited by 56%).  The other most frequent triggers for departures were a desire for a new career (50%), a lack of benefits (39%), difficult customers (38%), long hours and rigid schedules (34%) and potential exposure to coronavirus (23%).

The exodus is also being fueled by a desire for more education. Eleven percent of the respondents said they’ve already gone back to school or enrolled in a training program as a prelude to a new career, and more than a quarter said they’re thinking of pursuing that route.

Some good news

The findings suggested that employers are far from helpless. Across all fields of employment, about a third of job hunters said they would reconsider quitting their current positions if the employer addressed just some sources of their dissatisfaction.

In addition, Joblist said that all employers should benefit from the reopening of schools for in-classroom learning. About 40% of the respondents said their work lives were impacted by the need to participate in their children’s remote learning.

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GrubHub founder Matt Maloney leaves 4 months after company was acquired

Grubhub founder Matt Maloney is leaving the food-delivery giant just four months after it was acquired by a European conglomerate.

Amsterdam-based Just Eat Takeaway bought Grubhub, which also owns Seamless, in June for $7.3 billion, naming a new chief executive — former president and chief financial officer Adam DeWitt — to succeed Maloney who was bumped up to the company’s board.

Maloney will step down in December to “pursue other opportunities,” the company said on Friday.

“Great entrepreneurs like Matt start businesses that touch the lives of millions of people,” Just Eat Takeaway’s CEO Jitse Groen said in a statement. “He has built a magnificent company and helped create hundreds of thousands of jobs across the US. We are sorry to see him leave the Company and wish him the best in his future endeavours.” 

Maloney, 44, who co-founded the company in 2004 in Chicago, had most recently grappled with the most tumultuous period in Grubhub’s history, as cities and states impose regulations aimed at curbing the fees delivery services charge to restaurants.

These efforts began in New York City before the pandemic in 2019 — led by City Council member Mark Gjonaj (D-Bronx) — and accelerated as the restaurant industry was decimated by COVID-19 and legislators took up their cause.The Grubhub food delivery app has lost market share to Doordash and Uber Eats over the past couple of years.Bloomberg via Getty Images

Over the past couple of years, Grubhub has steadily lost market share to rivals, Doordash and Uber Eats, across the county and in its core market, the Big Apple.

By one measure, Grubhub controls 34 percent of New York City as of July, down from 72 percent just two years ago, according to data analytics firm, Bloomberg Second Measure. Doordash has edged into the number one position with 36 percent market share, according to the data company.

Grubhub has also lost market share across the country, accounting for 17 percent of US food delivery sales in May compared to 21 percent for Uber Eats and 57 percent for Doordash, according to Second Measure.

Two years ago The Post exclusively broke the news about GrubHub erroneously charging restaurants fees for as much as $11 a pop for telephone calls that never resulted in a food order — and resulted in City Council hearings and legislation making the practice illegal.

The company’s shares were getting hammered, plummeting by 43 percent after a poor earnings report on Oct. 29, 2019, in which GrubHub drastically slashed its financial outlook, blaming fierce competition at the time.

At the time, Maloney wrote a 10-page letter to investors and pointed a finger at what he called “promiscuous” diners who were getting lured to other services like UberEats and Doordash that have been dangling discounts, he said.

“It’s very hard to trick a consumer to pay more than they want to pay,” Maloney said on an earnings call, adding that consumers “are incredibly price sensitive, they understand what they are paying.”

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Slice Invests Additional $15M in Pizzeria Accelerator

Slice, the pickup and self-delivery provider for independent pizza restaurants, announced an additional $15 million infusion to its Slice Accelerate program that grants independent pizzerias with $15,000 in technology and services to grow their businesses. First started last year, this latest round is expected to bring another 1,000 restaurants into the company’s small business accelerator.

Inspired by the added stress offline small businesses were experiencing as a result of COVID-19, Slice launched Slice Accelerate in September 2020. The program was designed to set independent pizzerias up for future success by offering additional services and one-to-one support that would maximize their potential and help them to compete with predatory third-party delivery apps.

Over the past year, Slice invested more than $1.5 million into the program and supported more than 100 shops by granting each $15,000 in tech and services as well as one-to-one mentoring. The program’s first cohort of Accelerate shops have seen incredible growth, according to the company. Data suggests that pizzerias that are accepted into Slice’s accelerator program can expect to double their digital sales within the first 12 months.

“I’m incredibly proud of the impact Slice Accelerate has made thus far. After seeing such strong results within the first year, Slice Accelerate is here to stay,” said Slice founder and CEO Ilir Sela. “Unlike a loan or a cash offering which is a quick fix—the complimentary services we offer through Accelerate are designed to bring lasting, effective results that set our partners up for future success and we look forward to continuing to invest both in our new and existing Accelerate shops.”

Additionally, Slice has brought on Pritesh Chandarana as the general manager for the program. Chandarana brings to Slice rich experience from past roles at Uber and Oyo and the company says he has an “incredible track record of maximizing potential for independent and small businesses across the country.”

Slice is accepting shop nominations, and selected shops are announced on a rolling basis. Slice’s selection criteria will include entrepreneurs with “enormous potential and a desire to use technology to scale up operations while maintaining a great quality product.” This opportunity is for small business owners wanting a playbook for success and an increase in sales.

For more information or to nominate a local shop that’s deserving of this grant, visit accelerate.slicelife.com.

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ChowNow Launches ‘Order Better Network’ Online Platform

ChowNow, a platform powering online ordering and marketing for independent restaurants, unveiled its Order Better Network, the industry’s first product to connect restaurants to over a dozen diverse channels for delivery and takeout, including major internet, social and hospitality brands. The Network enables restaurants to connect with millions of new customers and makes it easier than ever for diners to find new local restaurants.

Brands on the Order Better Network include:

  • Order With Google
  • OpenTable
  • Yelp
  • Rewards Network, including: Hilton Honors Dining, Delta SkyMiles Dining, United MileagePlus Dining
  • Snapchat
  • Tripadvisor
  • Nextdoor
  • Seated

Being a part of the Order Better Network helps restaurants grow their online sales by up to 30 percent. ChowNow helps restaurants set up digital storefronts on these partner platforms and will continue to add new partners to maximize restaurants’ online footprint.

“ChowNow’s mission for over ten years has been helping independent restaurants thrive,” says Chris Webb, co-founder and CEO of ChowNow. “The Order Better Network offers a huge opportunity for growth. Now for the first time, restaurants can easily and efficiently expand their online presence across a variety of popular brand channels and access millions of new customers.”

ChowNow has helped over 22,000 local restaurants across North America build their online business sustainably, with over 150 million orders processed and $4.7 billion in food sales generated to date. The company offers a range of digital tools and services that can be tailored to meet an individual restaurant’s needs, from building branded websites and apps to providing marketing support and valuable customer data analytics.

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Local Columbia restaurants struggle to find right way to work with big delivery services

COLUMBIA — Despite the pandemic’s surge of carryout customers, some small Columbia-area restaurant owners say that delivery services don’t add up for them.

Services such as DoorDash and Grubhub have marketed themselves as ways for restaurants to reach more customers than before. 

At its new location in West Columbia, longtime local favorite D’s Wings has four spaces out front reserved for pickup orders. While the restaurant can receive orders from DoorDash, it’s mostly using those space to fulfill orders called in directly by customers. 

An order that comes in from DoorDash or another service means that a substantial share of the revenue goes to those delivery companies.

At a time of rising prices for ingredients, that doesn’t make a ton of sense to Scott Thurber, one of the co-owners of D’s. The restaurant already has had to raise menu prices this year because of higher costs. Losing a percentage of the sale to a delivery company doesn’t help.

“Margins are thin enough,” Thurber said.

The big delivery companies are facing new resistance in some major markets. 

In September, Chicago filed a lawsuit against DoorDash and GrubHub, alleging that the companies have used misleading fees and markups in their agreements with restaurant owners. The companies deny that any pricing is misleading.

Other suits about the companies’ business practices have been filed in Massachusetts and the District of Columbia. 

Also in September, DoorDash, UberEats and GrubHub sued New York to block a recently imposed city cap on fees that the services can charge to restaurants. The companies argue that the fee caps hurt both them and restaurants.

Some delivery services can expect to receive up to 30 percent of the purchase cost of food under some commission plans. Consumers also pay a delivery fee to the companies on top of that. 

For high-end restaurants, delivery services don’t make a lot of sense, said Ricky Mollohan, owner of Mr. Friendly’s in Five Points.

Before the COVID-19 pandemic, the restaurant used one of the services, Bite Squad, and limited its ordering window to early and late on weeknights and never on weekends.

Even that was a challenge, Mollohan said. A small kitchen in a fine dining restaurant is only big enough to serve the number of tables in the restaurant. 

Any added orders, which is a key selling point for the companies, only are likely to overrun capacity, he said.

“For fine dining, it’s just simply not practical,” he said.

Mollohan admits that he’s not a fan of carryout dining in general. For a restaurant that focuses on peak freshness and plate presentation, there’s a letdown in putting that meal in a box and letting it get cold on the way home, he said.

Sometimes, even without any business agreement, Mr. Friendly’s gets calls from third parties placing online orders. Often, it becomes obvious because they are using an outdated menu to place customer orders.

Mollohan said he has sent multiple emails and made many calls to stop services from listing his restaurant. For him, it’s about the reputation of Mr. Friendly’s and how it could be damaged by poor service or orders from outdated menus that cannot be filled.

“You do not want them representing you in any way,” he said.

Sound Bites Eatery, a new restaurant focused on fresh made-to-order salads and sandwiches on Sumter Street in downtown Columbia, is splitting how it handles deliveries.

So far, manager David Stelzer said, it has had staff members make most deliveries in the downtown core of nearby businesses and office buildings.

For orders when no staff staff member is available to go or the address is too far away, the order will be fulfilled by DoorDash.

That adds a fee to the customers’ order, and Stelzer is well aware of the $7.50 in additional cost for a salad or sandwich order.

For a restaurant focused on freshness, the time to get their food to the customer is an additional worry. 

“We are still figuring it out,” Stelzer said.

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Rideshare Drivers Could Make as Little as $4.82 Per Hour if Uber Gets Its Labor Law in Massachusetts, Study Finds

Uber, Lyft, DoorDash, and Instacart are looking to buy another law in Massachusetts by replicating Prop 22, the disastrous, virtually irrevocable California ballot measure that deprived their workers of employee status. Now, leading rideshare labor researchers from the UC Berkeley Labor Center have predicted how bad it could get—as little as $4.82/hour for Uber and Lyft drivers.

The findings from researchers Ken Jacobs and Michael Reich aim to disprove Uber and Lyft’s illusory claims that drivers would ultimately make more money than they would as employees. Like Prop 22, the measure writes in a pay floor of 120 percent of minimum wage, which would be $18/hour in Massachusetts. But, like Prop 22, the ballot measure excludes much of workers’ time on the clock; the companies would only cover the differential for “engaged time,” that is to say time spent traveling to, and shuttling, a passenger. By researchers’ estimates, that excludes about 33% of a driver’s actual hours spent waiting for rides and circling the block—a side effect of flooding the market with drivers in order to reduce wait times for riders.

“Minimum wage” is one of the many misleading promises Uber and Lyft and DoorDash have used to deprive workers of their rights. Gearing up for the 2022 Massachusetts vote, advocates are up against a $100 million propaganda sweep, and we can guess what this might look like based on the over-$200 million Prop 22 campaign. The companies deliberately sowed confusion about who the measure benefited and who was behind it, pummeling voters with flyers disguised as Bernie Sanders endorsements and Latinx voter guides, and forcing workers to disseminate their messaging. Some California voters told the Washington Post later that they’d been duped. A judge ruled it utterly deceptive and its enforcement unconstitutional. Uber CEO Dara Khosrowshahi fully intends to implement Prop 22-like measures in every state. They’ve already been running ads in Massachusetts for months.

The brief report is limited by Uber and Lyft, which hoard their data and have refused to share it with researchers other than those that they keep on their payroll. (Presumably, Uber and Lyft could share it if they wanted to definitively discredit opponents.) In the absence of that, researchers were able to calculate the $4.82 estimate based on anticipated driver expenses, the measure’s limited benefits offerings, previous driver surveys, and the ballot measure’s loopholes.

On top of excluding waiting hours, the companies also promise reimbursements for expenses, but a portion far less than workers would receive as employees. They offer a low health care stipend, but only to people who work a minimum number of “engaged” hours, which, researchers find, would exclude most drivers. Then, the independent contractor status bars drivers from receiving unemployment insurance, workers’ comp, or medical leave. Factor in the payroll tax that “self-employed” drivers have to cover themselves, and the take-home pay dips well below $18.

Lyft declined to comment directly on the study or to provide data contradicting it. A spokesperson directed Gizmodo to the Massachusetts Coalition for Independent Work, a 501(c)(4) backed by gig companies.

The group shared a release titled “Drivers React to Special Interest Propaganda Push on Ballot Question,” labeling the UC Berkeley Labor Center a “union-affiliated Berkley, California think tank.” (Nowhere does the release disclose that the coalition is not a grassroots labor organization or that it’s backed by rideshare companies.) The release quotes a person identified as a driver calling the study “misleading propaganda” and accuses Reich of publishing the study in an effort to promote union membership.

The rest is light on details, saying that the ballot measure guarantees 120% of minimum wage and that, factoring in tips, drivers receive “a higher earnings floor than offered in countless other industries.”

Uber did not respond to our request for comment.

Testimonies from app-based workers don’t reflect the lifestyles of people making a lot of money with flexible hours. New York City delivery workers for UberEats, Lyft, and DoorDash have reported that they often work six or seven days a week, and in a survey of 500 workers, half said they couldn’t pay rent. Before New York City passed a wage floor for drivers, Reich and James Parrott found that 60 percent of drivers worked full-time, 80 percent had bought a car to drive for work, and one-fifth were on food stamps.

It’s worth mentioning that some studies have severely underestimated drivers’ earnings, and researchers have to rely on data from the companies themselves. That’s not a reason to dismiss these studies (and notably, Reich and Parrott have been proven right). We have plenty of reason to flat out reject app-based companies’ numbers.

Here’s an example: last year, dueling studies on Seattle rideshare drivers’ wages came out around the same time, one from Cornell that was commissioned by Uber and Lyft, the other, by Reich and Parrott, commissioned by the city of Seattle. The former found that drivers made $23.25/hour, while the other landed on $9.73. 

Cornell researchers drew from the companies’ data, measuring only one week in October 2019. They used the companies’ preferred methodology and admittedly based their figure on a set of assumptions about what drivers are doing during wait times (possibly their own thing) and why they drive (possibly a side-hustle). An absurd number of findings were followed with disclaimers about limited data, research, and time constraints.

Reich’s and Parrott’s independently conducted study considers far more details, with contributions from numerous city officials, additional researchers, and a review by the city of Seattle. It compared data from the Census Bureau, the Seattle Department of Transportation, their own survey of 6,500 drivers, and limited available data from Uber. They gathered more data on what portion of drivers actually worked full-time. They similarly found that gross hourly pay amounted to $21.53 but deducted expenses and factored in wait times.

App-based companies fudge the numbers all the time. In a recent post, I cited an app-based delivery workers’ study finding that New York delivery workers made $7.87/hour before tips when factoring in wait time. DoorDash told me that their workers made on average $25/hour and ignored the question of how it calculated hours.

Tellingly, the companies didn’t prove Reich and Jacobs wrong after they published a similar study on Prop 22 in 2019, which the Massachusetts Coalition for Independent Work calls “debunked.” In rejecting the findings, though, Uber didn’t invalidate them—it only says that it chooses to look at different sources of data and definitions of work hours. “A cashier cannot, for instance, show up to work whenever or wherever they want,” Uber economist Alison Stein wrote in a blog post. “They cannot choose to ignore certain customers, or to take an unscheduled break.” Uber doesn’t actually measure what on-app time is spent as a “break,” and refuses to do so, Stein said, because monitoring drivers would limit their “freedom from control.” (If drivers were employees, Uber would still be required under federal labor law to pay for time it designates as “breaks.”)

The $4.82 figure is a hypothetical low estimate, but what’s certain is that the ballot measure doesn’t guarantee minimum wage in the sense that wage is payment for work. What it does ensure is that drivers, excluded from employee rights, won’t be able to bargain for more.

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Grubhub founder quits four months after Just Eat deal

The founder of US food delivery platform Grubhub has quit the business just four months after it was bought by UK-listed rival Just Eat Takeaway.

Matt Maloney joined the Just Eat Takeaway board in June but has since stepped down to “pursue other opportunities”, the company said.

Just Eat boss Jitse Groen said: “Great entrepreneurs like Matt start businesses that touch the lives of millions of people.

“He has built a magnificent company and helped create hundreds of thousands of jobs across the US. We are sorry to see him leave the company and wish him the best in his future endeavours.”

Mr Maloney did not comment.

His company, Grubhub, was bought by Just Eat for around £5.8 billion to make Just Eat the biggest food delivery platform outside China.

It has 244,000 restaurants on its platform with 588 million orders placed last year.

Grubhub had previously been courted by Uber, but it failed due to competition scrutiny.

Mr Groen said at the time that the importance to the deal’s success was his long-standing relationship with Mr Maloney.

He said: “Matt and I are the two remaining food delivery veterans in the sector, having started our respective businesses at the turn of the century, albeit on two different continents.

“Both of us have a firm belief that only businesses with high quality and profitable growth will sustain in our sector.”

Mr Maloney said last year when the deal was announced: “Combining the companies that started it all will mean that two trailblazing start-ups have become a clear global leader.

“We share a focus on a hybrid model that places extra value on volume at independent restaurants, driving profitable growth.

“Supported by Just Eat Takeaway.com, we intend to accelerate our mission to be the fastest, best and most rewarding way to order food from your favourite local restaurants in North America and around the world. We could not be more excited.”

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ChowNow launches Order Better Network

  • Online ordering platform ChowNow on Tuesday launched “Order Better Network,” a solution that connects restaurants to more than a dozen channels for delivery and takeout orders. Brands on the platform include Google, OpenTable, Yelp and several more.
  • The Order Better Network helps restaurants set up digital storefronts on these social platforms so diners can browse, order and checkout without leaving them. The new offering has shown to grow online sales by an average of 30%.
  • Triple-digit growth in delivery and carryout sales at full-service restaurants has forced more restaurants to rely on digital ordering. Independent restaurants, which have smaller marketing budgets to pay for placement on third-party apps, could benefit from ChowNow’s new offering. 

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Dive Insight:

This launch could entice independents running on thin margins away from third-party delivery platforms, which charge commission fees of 30% on average. ChowNow provides a commission-free model to its 20,000-plus restaurant partners. Last April, ChowNow partnered with Instagram to add “Order Food” buttons to stories and profiles.

According to a company blog post, the Order Better Network “casts a wide net that effectively lets your restaurant be everywhere at once,” reaching diners who are ready to order. ChowNow said it will continue to add new partners to the network, but the current roster already offers broad audience reach. Before the pandemic, OpenTable sat more than 31 million diners every month, for example, while Yelp has 31 million unique devices using its app.

“ChowNow’s mission for over ten years has been helping independent restaurants thrive,” Chownow Co-founder and CEO Chris Webb said in a statement. “The Order Better Network offers a huge opportunity for growth. Now for the first time, restaurants can easily and efficiently expand their online presence across a variety of popular brand channels and across millions of new customers.”

But third-party platforms offer competitive access to diners, too. Half of U.S. consumers have ordered from a major third-party delivery provider at least once, according to data from August 2021. DoorDash, which has the biggest slice of market share among delivery platforms, has more than 20 million active consumers worldwide in a given month.

DoorDash, Grubhub and Uber Eats have all also added new features to appeal to smaller restaurants and compete with rival online ordering platforms. These tools include tiered pricing structures and marketing and technology support. Grubhub introduced a new toolkit last year that allows restaurant partners to add online ordering to their native channels, without charging a marketing fee for the service.

Still, ChowNow and similar companies like CaterCowOrdermark and Lunchbox are growing while charging restaurants low or no delivery fees. ChowNow’s partnership with major websites could hasten that growth, particularly as delivery demand remains high and third-party commission fees eat into erestaurant margins.

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From DoorDash To Huawei: Business Model Revolution

It used to be that we could excuse most CEO’s for not being more involved or supportive of innovation, because they typically did not come from a technical background. That excuse became invalid when business models became de rigueur for strategy discussions. Almost every day, now, the business press features unfamiliar, non-technical, competitive moves by insurgents revitalizing mature, traditional industries. They are making unconventional choices regarding business model elements that typically were formerly disregarded in strategic conversations among successful, incumbent market leaders.

DoorDash, for example, has moved from being merely a delivery vendor, to becoming a legitimate ecosystem partner with the restaurants that it formerly served. Its business model places it at key customer-facing touchpoints along the customer journey that they jointly share, including ordering, payment and delivery. In many instances, it is the restaurant who is the supplier, and DoorDash the key customer brand. Ghost kitchens, or non-retail kitchens for the delivery trade, have, similarly, arisen as important players in linking restaurant knowledge with delivery providers. Wao Bao, for example, describes itself as a “partner with local restaurants to simply steam our [signature] menu items and have them available for pickup or delivery via third party services (i.e. DoorDash, Grubhub, and Uber Eats.).” Its website speaks of “a virtual kitchen concept that slides into any commercial space and transforms it into an Asian restaurant…” This is business model innovation. Local restaurants can now add exotic items to their menus, without the expertise or kitchen equipment that was traditionally required. This reduces what were once formerly unbreachable barriers to entry to many industries. We can also see business model innovation in the same food and beverage delivery industry when Gopuff acquired BevMo! so as to control its own alcoholic beverage inventories, “a move it claims helps it achieve a more reliable service and bigger margins,” both of which have important customer experience and business model connotations.

Nor is the business model revolution limited to so-called old-economy industries. It is also evident in the U.K.-based broadcaster Sky’s decision to move into hardware as well as content. As streaming video becomes an important part of viewing life, Sky sees customer needs to “navigate a complex entertainment ecosystem,” as an attractive value-proposition opportunity, that they can serve as a “content gatekeeper,” by packaging their services in a TV box. Is technology involved? Absolutely! But, this is not so much technological innovation, if at all, as it is business model innovation, regarding customer journey pain points, and the need for new content navigation and delivery offerings. Technology is more an after-thought, and probably completely out-sourced; this is very much business model innovation.

Apple, the quintessential iconic consumer technology company, has long been a pioneering business model innovator. Its early concern for a better customer experience as the starting point for all it did not only resulted in a graphical user interface to delight the user, but also led to the pursuit of physical device beauty and more satisfying customer experiences, from box-opening to the tactile sensation of how an iPhone felt in your hand. Hardware-involved as such choices might be, they are still very much about the business model, as well. In fact, Apple’s pathbreaking entry into its distinctive retail presence, and the interconnectability among all of its products, were strategic choices that made the rest of its business models coherent.

One last example of business model innovation, and at the very forefront of hi-tech strategy, is that of Huawei, the beleaguered Chinese telecom company, that has incurred massive revenue and supply-chain losses due to embargoes by Western governments; a situation they could never have adequately anticipated. With a 30% drop in revenues in the first six months of this year, against 2020, Huawei has resorted to unorganizing its portfolio of research and development opportunities, upon which it now spends 16% of its revenues, into a “huge collection of start-ups,” hoping that they can get closer to their target customers, and move faster as a result. While there is undoubtedly an element of inside-out thinking to this approach, it is much more about how the technology is developed, and when, than it is about the technology itself. It also, by default, repositions strategy decisions much lower in the organization, as well; and, so, a big bet on entrepreneurship as a competitive advantage. In this case, what we see is business model innovation, and organizational transformation to support this new innovation approach, in an effort to move forward without reliance upon what were previously core assets.

Make no mistake about it, business model innovation is everywhere, and it is profoundly changing a number of previously innovation-stagnant industries. Business model innovation places a premium on business acumen to identify novel ways of improving the customer experience, while the technology, to the extent that any is needed, can always be sourced as required. As a result, in the age of digital, ironically, it may well be that technology loses its role as the instinctive, and even principle, corporate strategic asset.

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Delivery wars heat up as services turn to OOH advertising

The delivery service wars — battles between DoorDash, UberEats and Grubhub — have been raging for several years as each brand jockeys for position as the leading food delivery provider.

Through the COVID-19 pandemic, popularity in delivery services skyrocketed as people stayed home to avoid getting the virus. Consumers felt comfortable ordering from delivery apps and chose their favorites.
In recent months, however, as the virus has (somewhat) receded and indoor dining restrictions eased, more patrons have returned to eat at restaurants, forgoing the delivery option. As a result, the major combatants in the service wars have had to pivot, finding ways to retain customers and convince them delivery is still a safe, efficient option. They needed new ways to promote their business.

The solution:out-of-home (OOH) advertising.

Intersection, an experience-driven OOH media and technology company, said that in the New York City market, 2021 Q3 delivery service campaign revenue increased more than 260% since Q2.

Digital Signage Today talked to Chris Grosso, CEO of Intersection, an experience-driven OOH media and technology company, by email to learn how the pandemic has affected the delivery wars, how delivery companies are leverage OOH marketing through the pandemic, what markets should expect to see an increase in OOH ad investment and more.

Q: In what ways has the pandemic affected OOH advertising in the delivery wars?
A: As vaccines rolled out and more people began spending more time outdoors for dining, shopping, and entertainment, delivery services wanted to keep the momentum they had during the lockdowns. The best place to catch audiences as they leave the couch is with OOH. In addition, a recent Harris Poll showed that 75% of Americans are burned out from staring at digital devices and 55% are noticing OOH ads more frequently.

Q: How have delivery services utilized OOH to reach more customers, generate business?
A: In cities like New York, the strategy seems to be saturation to stay top of mind. Our Q3 delivery service campaign revenue is up more than 260% since Q2. In addition, delivery services need to hyper-target neighborhoods and dayparts as they expand their delivery footprint. OOH products like LinkNYC allow advertisers to get their messages out to the right neighborhood at the right time.

Q: Do you feel some delivery services are using OOH better than others? Any specific examples?
A: Any brand with relevant and bold creative is going to win in OOH. One delivery service leveraged our digital assets in New York and Philadelphia to implement a dynamic program that changed creative and locations based on time of day to reach their target audiences as they traveled throughout the city. For instance: In the morning their creative would promote breakfast restaurants. During the evenings, their creative displayed dinner options available via the app. Other brands have used video for their campaigns, and I always find those very eye-catching when walking down the street.

Q: What are some of the key elements an OOH delivery service campaign should have to attract more customers?
A: Relevancy and context are important and OOH enables brands the ability to do both quite well. And of course, the ability to target — both neighborhood and daypart — and measure results are critically important. One leading online grocer leveraged Intersection’s Digital Event Measurement product to track traffic driven to their website from their city-wide campaign on LinkNYC. The campaign generated an attractive cost per site visit and also allowed for in-flight campaign optimization.

Q: Besides delivery service, what other verticals do you see best utilizing OOH? What trends do you think will pick up in the future?
A: Digital brands looking for ways to expand their presence to the physical world are leveraging OOH campaigns effectively to have a presence in public space. Most of the leading tech players are also major participants in OOH. In addition, media and entertainment, education, finance and health care have continued relying on OOH both before and throughout the pandemic. We’ve also seen automotive and pharma pick up in recent months.

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