How Deliveroo developed a taste for restaurant food delivery

May 03, 2018 12:07
Consumers in Hong Kong value fast and convenient service more than anything, says Deliveroo CEO Will Shu. Photo: HKEJ

If you are a Londoner, don't be surprised if you get to meet the boss of Deliveroo in person – as a delivery driver for food take-outs.

Will Shu, co-founder and CEO of the British online food delivery firm, reveals that he delivers food to customers, particularly those living in his neighborhood, personally "once every one or two weeks".

Shu says he undertakes the missions as they help him gain better understanding of his customers and their needs, and also to experience first-hand the daily chores of the firm's delivery staff. 

Moreover, the activity can sometimes be a good physical workout.

"I'm always talking to other riders, going: 'Hey, I’m doing deliveries for this company, would you like to join?" Shu told the Hong Kong Economic Journal recently.

Launched in 2013, Deliveroo has become one of the most successful startups in Britain. Shu says the idea originated before 2010, when he was working in the financial sector in the UK.

"Take-away menu is definitely one of the must-have items in the office. We could just call the restaurant, and provide a credit card number to place orders,” Shu recalled. He added that he had been a loyal customer of Just Eat, the first popular food delivery service in Britain.

However, Just Eat relied on restaurant staffers to deliver food at that time, leading to long waiting times. The company was also found wanting in building brand recognition among consumers.

Shu started thinking about ways to revamp the business model of a food delivery service platform, like setting up an own delivery driver team, which is how the idea of Deliveroo first took root.

Shu shared his idea with a friend, Greg Orlowski, who then brought up the issue of the need for a portable computer for each delivery driver if a self-owned delivery team is to be formed.

"But where could we find suitable mobile devices when the iPhone had just launched?” said Shu who postponed the startup idea until 2012, when the mobile application ecosystem took shape.

Deliveroo was launched in the following year, with Shu and Orlowsk as co-founders.

First started in the UK, Deliveroo has rolled out in Hong Kong since 2015, a market which Shu previously identified as a strong contender to replace London as Deliveroo’s largest market in the world.

Shu noted that there were only local Hong Kong style diners (cha chaan teng) and a few western style restaurant chains offering food delivery service, and that medium- and high-end restaurants were absent in this market, providing an opportunity for his firm.

"There are so many dining options in the city, with a high urban population density. We believed it would not take too long for food to get delivered from the restaurants to consumers’ doors," he said.

"We know consumers in Hong Kong value fast and convenient service more than anything, that’s what we are here for," Shu added.

The CEO recognizes that Hong Kong’s community and environment are very different from that in the Europe and the United States.

He admitted that his firm couldn't “just copy and paste” to Hong Kong their success formula from the West.

He referred to Deliveroo "runners" as an example. With the high population density and lower popularity of biking in the city, Hong Kong is the first market where Deliveroo offers point-to-point delivery service on foot for some orders.

The online food delivery platform is set to gain more ground as it establishes closer collaboration with restaurant partners with "Deliveroo Editions" business, a central kitchen that hosts a variety of restaurants.

The company launched its first such facility here in Wanchai last September, helping its restaurant partners to expand, create new brands and draw in new customers with a wider array of food choices.

Brian Lo Ka-chung, Deliveroo’s Hong Kong general manager, told HKEJ that the kitchen concept already caters for 18 brands on the Deliveroo platform, and that the company plans to set up new kitchen facilities in the city.

"We were the online food delivery service provider in Hong Kong, and now we see ourselves as a partner with restaurants in the city," Lo said.

This article appeared in the Hong Kong Economic Journal on May 2

Translation by Ben Ng with additional reporting

[Chinese version 中文版]

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Hong Kong Economic Journal