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Mena food delivery market sizzles with Dh32 million sales per restaurant and 10% order surge in Q1

Sector is expected to grow at a robust CAGR of around 20.5%

The online food delivery market in the UAE is expected to reach a revenue of $67.12 million by 2024, with an anticipated compound annual growth rate (CAGR) of 5.55 per cent, leading to a projected market volume of $87.92 million by 2029, a study showed on Tuesday.

The Middle East and North Africa (Mena) region is experiencing a surge in restaurant delivery, driven by a growing consumer appetite for convenience.

New data from Syrve Mena, a restaurant software provider, and Admitad, a leading partnership marketing platform, reveals a 10 per cent year-over-year increase in delivery orders during the first quarter of 2024. This follows a strong 2023, where residents placed six per cent more delivery orders and spent five per cent more than the previous year.

In Saudi Arabia, the number of users in the meal delivery market is expected to reach 19.5 million users by 2029, with a projected user penetration rate of 42.9 per cent in 2024.

This year, UAE restaurants received thousands and millions of delivery orders with a median of 228,740 orders per year and Dh32 million sales per restaurant, according to Syrve Mena data. The number of delivery orders reached more than 600,000 per year with Dh126 million sales amount for fast-food chains specialising in delivery.

The study highlights the dominance of mobile convenience in the Mena food delivery landscape. Over 70 per cent of all orders are placed through smartphones, reflecting the region’s high mobile penetration rate. Interestingly, promotions are king when it comes to attracting customers. Over half of users leverage coupons and promo codes, while over a quarter benefit from cashback rewards, emphasising the effectiveness of loyalty programmes.

“Content also plays a significant role, with blogs and thematic web pages influencing over 20 per cent of delivery orders. Well-targeted contextual advertising adds another 18 per cent to the mix,” said Anna Gidirim, CEO of Admitad.

Delivery habits also showcase intriguing seasonal trends. Orders typically peak during March and April, coinciding with Ramadan, with a secondary surge in September and October. January and February, on the other hand, are generally slower months.

The study also dives into cuisine-specific trends. Arabic cuisine has a surge in the mornings, with 71 per cent of orders placed between 10:00am and noon, and kebabs taking the top spot for delivery. In contrast, dinner is the show’s star for Indian (43 per cent delivery orders) and Italian restaurants (85 per cent delivery orders), experiencing peak hours between 8:00pm and 11:00pm. Roti, butter naan and dal makhani are popular choices for Indian delivery, while Italian restaurants see a strong demand for dinner classics such as pasta and risotto.

At the same time, international chains (64 per cent delivery orders) also peak during dinner hours, with shawarma, kebabs and fries being popular choices. Interestingly, delivery makes up a smaller portion of the business for Italian and Asian chains (13 per cent of delivery orders), but their peak hours still mirror those of others, from 8:00 pm to 11:00 pm.

Fast food also reigns supreme in the delivery arena, with a staggering 89 per cent of orders placed for delivery. Their peak hours align with others from 8:00 to 11:00 pm, and churrasco and rolls are a top delivery item.

“The Mena region’s food delivery market is booming, driven by convenience-seeking consumers and a strong mobile culture,” said Alexander Ponomarev, CEO at Syrve. “We expect this trend to continue as restaurants leverage data and technology to deliver personalised experiences and cater to evolving customer preferences.”

The future looks prosperous for the Mena food delivery market, with factors like urbanisation, smartphone adoption, and convenience-driven dining experiences contributing to its rapid growth. Furthermore, the increasing popularity of mobile ordering, compelling promotions, and strategic marketing promises continued growth for both restaurants and delivery platforms, the study showed.