How Can You Monetize Your Food Delivery App?

In recent years, the on-demand and gig economy segment has been in the news due to the top-notch convenience it offers to users. And why not? After all, people’s inclination towards “comfort” and “online apps” is increasing. The entire on-demand sector is booming, but the online food delivery market is growing by leaps and bounds, where users can browse restaurants, place an order, and get their favorite food at their doorsteps.?

UberEats, Zomato, GrubHub, Rappi, etc., are popular food delivery apps in their respective regions and make the overall food delivery experience enjoyable for customers and drivers. Moreover, after witnessing the major success of these apps, startups and even well-established entrepreneurs are taking a keen interest in this domain and want to develop a fully-featured food delivery app.??

But what business model does the food delivery app follow? How does this help to make money? In this blog, you will learn about the monetization strategies you should consider if you are about to enter the growing food delivery market.

Top Food Delivery App Monetization Strategies and Models?

Launching a food delivery business is not everyone’s cup of tea. You need to work on multiple aspects such as features, technology stack, design, business model, revenue streams, a team of professionals, and whatnot.?

Regardless of your business model, your mind always considers the revenue model first. With more people loving the comforts of getting food delivered to their doorsteps, the demand for online food delivery app script has increased drastically over the last few years.?

Again, from the restaurant's perspective,? they can leverage such services to increase order volume and sales. On the other hand, delivery providers are individual professional drivers who accept online orders and work flexibly to earn extra income. This way, online food delivery apps establish a win-win situation for all the stakeholders involved.?

Now, without any ado, let’s look at the monetization strategies that will help you get better returns on investment and boost profits.?

Subscription Model?

One appealing concept for app monetization is the subscription service. Give customers the choice to sign up for a premium service, which offers advantages like free delivery, exclusive discounts, and first-priority access to new foods or eateries. You can ensure a consistent flow of income and cultivate a devoted customer base by offering them extra value.

Commission Based Model

This is the most popular monetization strategy followed by all popular food delivery apps. ? It helps food delivery business owners earn revenue by charging a particular commission on each order successfully delivered to the customer’s location. In this revenue model, the app collaborates with nearby restaurants in exchange for a specific commission on orders that take place on the app.?

The model is beneficial to the app and the affiliated companies. The platform connects users to nearby restaurants and allows them to get food delivered to their doorsteps. By charging a fee, the food delivery app makes money.?

For instance, the popular food delivery app UberEats charges 15% to 30% commission on each order placed.?

Delivery Charges

This is another vital revenue model where the app charges specific fees if the restaurant lacks dedicated doorstep delivery partners. Delivery charges can be based on distance and time. For instance, users must pay more delivery charges if the order has been placed during peak hours. Deliveroo is one of the food delivery apps that make money this way.?

One of the reports stated that Deliveroo made ￡129 million; for each order, they charged ￡2.5 to the customers, and thus, they made a decent amount of money in no time.?

In-app Purchases?

In-app purchases are another exciting way to make money from your food delivery platform. It would help if you did not overlook this monetization strategy, as it ensures long-term success.?

It will only be ineffective if the offer isn't worth the financial outlay. If you overcharge for in-app purchases or the value isn't high enough to make paying for them worthwhile, they won't succeed. If you lack the time, traffic, or resources to determine the appropriate price for every sale, this might not be the best course of action.?

Advertising?

This is another excellent way to make money for an online food delivery platform. Restaurant or store partners can get started with the sponsored option, where they can advertise their products or dishes in exchange for a certain amount. By advertising, we mean that online food delivery apps can list a restaurant at the top of a search for a specific period.?

For instance, popular food delivery apps such as Zomato, Doordash, GrubHub, etc., charge money to restaurant owners to feature their names on the top. This means there is a chance that restaurants will get more orders and attract more customers. But make sure you collaborate with restaurants popular in the city area and have a decent number of positive reviews.?

To Conclude?

The on-demand food delivery model has gained considerable momentum in recent years and offers a hassle-free experience to customers by saving their time and effort to visit physical restaurants. Especially amidst the pandemic, online food delivery apps have made huge revenue and allowed restaurants to stay afloat. As you can see, there are different ways to earn income through food delivery apps. So who is stopping you? Enter the lucrative food delivery market and take advantage of this promising business model.?