Uber is leveraging its ride-hailing success in Africa to deliver local fare that caters to the tastes of its middle-class customers, Reuters reported on Thursday (Jan. 2).
The company tapped data from its rides service to track food destinations and from Uber Eats to monitor food searches, which provided insight into what people were craving and from where.
In May, Uber Eats rolled out in Soweto. Working with about 20 partners in the area, the service delivers an extensive menu of 480,000 items, featuring local specialties like caterpillars and sheep’s head.
“I’d say Uber Eats has improved our sales by about 15 to 20 percent. But I’m targeting even more, up to 50 percent,” restaurant owner Dumile Badela told Reuters. “There’s huge opportunity.”
The online food delivery space in Africa was worth 10.49 billion rand ($713 million) in 2019, according to Statista. It is expected to expand about 14 percent each year, reaching 17.6 billion rand by 2023.
“Now that we’re in Soweto, we want to take those experiences and expand them to other townships, and go even deeper into Soweto,” Dave Kitley, Uber Eats’ general manager for South Africa, told Reuters. “We’re thinking a lot about migration … When they move, their taste buds move with them.”
Two companies corner 80-90 percent of the food-hailing market in South Africa – Uber Eats and South Africa’s Mr. D Food, which is part of the Naspers-controlled eCommerce firm Take-a-Lot, according to research firm Insight Surveys.
The Mr. D Food app has an estimated two million downloads in South Africa and 700,000 active monthly users. The company handled 1.5 billion rand in food orders in the past year.
Conversely, Uber Eats told Reuters that its downloads hit 2.1 million, but did not provide food sales data.
Those services will soon be joined by Estonian-based Bolt (formerly Taxify), Uber’s chief rival in Africa. Bolt is planning to soon introduce a food delivery service in South Africa.
Bolt CEO Markus Villig said his company is beginning to see profitability in most of the regions in which it operates, and that the firm is close to breaking even in about 66 percent of markets.