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Features, Cost, and Monetization of On-demand Delivery Apps

Online delivery business models using mobile is trending since 2017. As we already know, the number of mobile users is increasing, and that figure is expected to shoot up to 258 billion by the end of the year 2022.

This is big news for the entrepreneur, SMEs, and online delivery business models who faced difficulty while reaching their target audience and creating a buzz about their products/services. With the rapidly evolving mobile landscape and increased use of lean methodologies in mobile app development, enhancing brand recognition, improving customer engagement, and attaining more significant growth is no longer a big deal for SMBs and large enterprises. If your business works as a bridge between a set of buyers and sellers or service providers and receivers, you must invest in on-demand app development without giving a second thought. Even if you’re a start-up trying to come up with some unique ideas to impress investors, you can develop an idea across the on-demand model, leverage on the booming on-demand and app economy, and ultimately get funded.

In fact, most of businesses investing in on-demand apps are start-ups. Food and grocery delivery app is an exciting space to start with despite immensely competitive market.

39 US-based private food start-ups with $5 million or more in funding are into food and grocery delivery business although Uber and Airbnb still rule. Apparently, they all are start-ups.

On-demand app enables the user to order any product or service and deliver it over to their doorstep literally, whether it is a drive, meal, cleaning service, or something else you might think of. Essentially, the answer to “What is an On-Demand Service App?” It is a connection among users and their needs a connection in the form of a mobile app.

On-demand delivery apps are on the rise these days.

Companies like Airbnb, Uber, and Glovo are one of the leading players in this industry. However, a bunch of start-ups has managed to fit into this niche: Nuro, Deliv, and LogiNext.

Business benefits of an on-demand method of delivery over traditional methods

  • User experience
  • Fast delivery of products or services
  • Cheaper prices than traditional service providers or sellers
  • Independent contractors working part-time.
  • Live chat and support system
  • Multiple payment options
  • Actionable rating systems

Important features for on-demand delivery apps

  • Customer Apps
  • Delivery App
  • Merchant App
  • Admin Panel
  • Accepting Order (and Rejecting)
  • Auto Price Calculation (or Fare Calculation)
  • List of Order/ Requests
  • Real-time Tracking
  • Maps and Navigation
  • Payment Gateway Integration
  • Delivery Confirmation
  • Review and Rating

If we talk about On-demand Food Delivery App, there are two different types of On-Demand Food Delivery Services in market. Starting on-demand delivery app development, you need to consider the service’s type. There are two main types: marketplace and platforms with in-house logistics.

Marketplace

Popular services: Airbnb, Uber, and Glovo, Zomato, Swiggy, Uber Eats, Delivery Hero, Deliveroo

Marketplaces or aggregators stand for on-demand delivery apps that connect users with restaurants. Customers can look through the menu, order food, and pay for it right from the app. As any other marketplace, on-demand delivery apps offer customer support if there are any problems with ordering or delivery.

The most widespread monetization model among aggregators is a fixed fee from each order. For restaurants, aggregators are a great way to keep a constant order flow minimizing idle hours. So, the commission is usually worth it.

Platforms with Logistic Support

Popular services: Domino’s, Jimmy John’s, McDonalds

This business model generally stands for on-demand delivery apps by restaurant chains offering users options from their menu. The restaurant is responsible for the whole delivery process and no commission applied. It is common to hire full-time couriers to serve the clients.

This business model is perfect for well-known restaurant chains. It lets them keep customers engaged providing personalized offers and not to pay commission to third-parties.

How to hire development companies for your on-demand delivery app?

Since App development company may seem overwhelming for businesses or entrepreneurs, especially for those selecting a company for the first time. Research exists to help you pick the best company for your needs, but where do you start? Clutch recommends considering the following factors when shopping for an iOS/Android app development company:

  • Portfolio of Company
  • Support and Maintenance provided by the company.
  • Conduct market research.
  • Meet your business goals.
  • Prototyping provided for the app.
  • Project Management technique.

How to monetize your on-demand delivery app?

Delivery charges

Since delivery charges are the main revenue source of all food delivery apps. If a restaurant does not have its own delivery team, such kind of an app can take care of delivery for a fee. Delivery fees can be a percentage of the order price or a flat fee depending on distance.

Peak hours

This monetization approach involves a delivery surcharge during peak hours. For example, UberEats sets surge pricing during lunch and dinner. At peak hours, UberEats limits menus and locations and charges an extra fee to make them available. To see how successful this approach can be, look at the graph below that shows the average UberEats income per delivery by city.

Advertising

Advertising is another way that food delivery apps make money. A delivery app can offer to advertise to restaurants at an additional cost. In a delivery app, advertising can mean listing a restaurant at the top of search results for a period of time. This is one of the major sources of revenue for Swiggy. Swiggy charges money to restaurant owners to feature their restaurants in the app. By being on a featured list, restaurants are shown above others in search results and can attract more customers.

Vendor Subscriptions

The subscription model is widely popular and extremely successful for some of the market leaders. The user needs to purchase monthly or yearly plans to provide the service for the user base. In this case, the business model is to generate revenue from the subscription amount paid by the vendors.

Cost of on demand delivery app like Airbnb, Uber, and Glovo 

The Cost to create an on-demand delivery app varies depending on the features. It will likewise rely upon the App Development Company that you are contracting. Yet you need to know the cost to develop an app like Airbnb, Uber, and Glovo, Zomato, Swiggy, Foodpanda, FreshMenu somewhere close to $12,000 to $18,000 around. You can hire a Mobile App development company that can be suitable for your time and budget. They charge on every hour premise. This every hour value contrasts as indicated by the country the on-demand delivery App developed for.

App platform

The platform cost of an app like Airbnb, Uber, and Glovo, Zomato, Swiggy, Foodpanda, FreshMenu varies based on the different platforms; Android costs relatively higher than the iOS platform because it mainly has more devices to be tested against. 

App design

The designing cost to develop an app like Airbnb, Uber, and Glovo, Zomato, Swiggy, Foodpanda, FreshMenu maintains its hold in the market, it is important to fancy customers with a variety of options in a variety of places by luring them in to make reservations. The app must design to be user-friendly and engaging.

Development

A Food ordering mobile app cost to develop an iPhone app as Airbnb, Uber, and Glovo, Zomato varies on the good and experienced developer vital as his location and expertise also influence the development of the app.

Advance and External Features

The features of the Airbnb, Uber, and Glovo, Zomato mobile app cost various like data sync, geolocation, booking/delivery calendar, push notification alongside OTP evaluation, etc.

Access Control Panel

The development cost of on-demand Food delivery apps like Airbnb, Uber, and Glovo, Zomato, and Swiggy varies and depends on the development of features to users of social media, email id storage, and using OTP’s.

The development cost for a on-demand delivery app like Airbnb, Uber, and Glovo, Zomato, Postmates, GrubHub, Doordash, Foodpanda, Swiggy, Uber Eats, JustEat, Faaso’s, can be resolved key factors as:

In India– The app development cost is exceptionally low when compared with other regions like Europe and the USA. It is $20-$80 every hour for building up an on-demand food delivery app with every one of the features.

In Europe and America– The value range is $120-$250 every hour.

Looking to launch a on-demand delivery business?

We have a team of UI/UX designers and developers having experience in multi domain applications who are developing scalable and prominent solution in React Native, iOS, and Android of different complexities. Feel free to write us in case of any queries.

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