As the coronavirus pandemic picked up speed in the early part of March, consumers flooded into grocery stores to stock up on food and basic goods. Sales went from virtually flat to almost 79% growth year over year as the coronavirus outbreak was declared a pandemic.
While supermarket sales remain elevated from the levels seen before the crisis began, consumers who fled restaurants to cook meals at home are now returning to their favorite dining spots -- only now they're having their food delivered.
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Change at a moment's notice
Data from Earnest Research, which analyzes anonymized credit and debit card purchasing data from millions of consumers, shows that for the week ending March 18, year-over-year sales for third-party delivery companies like DoorDash, Grubhub (NYSE: GRUB), and Uber (NYSE: UBER) Eats rose 13.7%, a 10 percentage point decline from the week before.
However, just seven days later, after most states ordered all restaurants to open only for takeout or delivery orders, the delivery apps saw their business surge. Sales rose almost 20 percentage points higher from the week before to record a 33% year-over-year gain.
The big winner in third-party delivery was DoorDash, which saw sales for the week ending March 25 rocket 72% higher from the year-ago period (and up 32 percentage points from the week before), while Grubhub and its affiliated Seamless service saw only 7% year-over-year growth, barely above its performance the prior week.
Both Uber Eats and Postmates fared significantly better than Grubhub, posting 26% and 13% gains, respectively.
While the grocery and restaurant landscape has changed considerably over the past month, there's good reason to believe that third-party delivery services will continue to see growth. It's also clear that some services will be dashing forward while others are left behind.
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Rich Duprey has no position in any of the stocks mentioned. The Motley Fool recommends Uber Technologies. The Motley Fool has a disclosure policy.
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