Dive Brief:

• Uber Eats has launched a click-and-collect option through its app, called Pick-Up. The company piloted the service in select U.S. cities in the beginning of the year, and has expanded it to London and Paris, according to Big Hospitality. Pick-Up will be available to all restaurants on the app, or more than 2,000 location in the London area. 
• The service is free to Uber Eats app users, while restaurants pay a discounted service fee. 
• The rollout comes on the heels of Deliveroo’s February announcement that it is also developing a click-and-collect option on its app, expected to roll out by the end of this year. 

Dive Insight:

Adding an in-app click-and-collect option is perhaps another sign that aggregate delivery companies are competing directly with restaurants. Some brands, like McDonald’s and KFC, have been offering click-and-collect services for years. McDonald’s U.K. launched the service in 2018 through its own branded app, while KFC started trialing the service in 2013 and ended 2018 with 10,000 restaurants offering the option.

During Yum Brands’ investor day in December, KFC CEO Tony Lowings said the brand will eventually have more outlets with click-and-collect than Walmart, Kroger, Costco and Target combined. These two quick-service giants aren’t alone, either. According to PYMTS.com, 45.1% of QSRs provide a pick-up in-store feature for mobile apps. 

Parallel to delivery, click-and-collect is a priority for a reason — it offers another choice for consumers who want to get their meal as conveniently and seamlessly as possible. And, thanks in large part to the grocery industry, more of these consumers are used to clicking and collecting.

Uber Eats isn’t the only delivery service going after consumers who prefer to pick up their meal on their terms. Deliveroo announced its click-and-collect service in February, saying the service will bring even more choice to consumers. While Uber Eats restaurants pay a discounted service fee to use this channel, Deliveroo collects a marketplace commission for being the online venue for the transaction. 

Besides convenience, it’s likely these delivery companies have other motives for expanding into click-and-collect. As they continue to grow and for some, go public, profit has been elusive. Click-and-collect may be a more viable path to profit than delivery on its own, which requires more people and logistics. 

Click-and-collect is a good idea on paper for delivery companies, especially as more consumers get used to having that channel as an option. But as delivery also grows as an option, click-and-collect becomes a bit less convenient by comparison, and recent studies have shown that customers are willing to pay more for optimized convenience. 

For now, however, click-and-collect is a growing space and therefore ideal for delivery companies that want to diversify. According to Nielsen, millennials prefer click-and-collect over home delivery when it comes to grocery shopping, which could translate into the restaurant space because of habit alone. But if more aggregates add this service, restaurant brands will have to contend with even more competition.