The online food delivery market is massive and growing fast. A recent study from Morgan Stanley says the U.S. market is currently worth about $30 billion, with the potential to be worth some $210 billion in the long term. Some call it the Uberization of food delivery, Morgan Stanley calls it the "pizza paradigm" - consumers want to be able to "order on-demand, and get fast, reliable, inexpensive or free delivery." Companies like Yelp Eat24, GrubHub, Postmates, UberEats and DoorDash are vying to dominate this thriving market.
When it comes to food delivery though, the report found 17 percent of people don't use online delivery because it takes too long; another 17 percent because it's not convenient - proving that one of the biggest points of differentiation in this market is customer service.
Yelp is one company using data to meet and exceed customer expectations. The company's VP of engineering, Kris Wehner, who oversees services related to restaurant reservations including restaurant and diner-facing technology, relies on Splunk to make data accessible for all employees, boost customer satisfaction and gain a competitive edge.
Moving Data Analytics from Engineers to Business Ops
When most people think about data analytics, their minds typically go directly to the engineering team. Traditionally, engineering teams use data analytics to drive "back-end" processes (i.e., applications, IT, production), with no clear impact on sales, marketing or other customer-facing departments. That has completely flipped. Now, we are seeing more companies rely on data analytics as a primary driver of customer experience and differentiation. For Yelp, the gold is in the "machine data" - or data generated by computer systems, mobile platforms and networked devices - including log data, clickstream data and wire data.
According to Wehner, the biggest challenge at Yelp before adopting Splunk was that the data was nearly inaccessible to customer-facing business users, and even the engineers wasted valuable dev cycles to get what they needed. "With demand growing so fast and competition growing," Wehner says, "we faced the issue of scaling with our open source clusters and having our infrastructure remain stable. We'd only have partial data availability, which made it difficult to rely on as a single source of truth."
To complement its open source tools, Yelp deployed Splunk Enterprise, which gives teams outside of engineering, including business operations and community management teams, access to data. These groups are using Splunk analytics to inform both IT and operational areas, customer strategies and user experience.
Winning the Online Food Delivery Market with Data
Yelp's Eat24 food delivery service uses Splunk to monitor its order pipeline, providing its operational teams with customized dashboards and real-time alerts to track food deliveries, making wait times as short as possible. Wehner explains, "We've been able to free up resources to invest more in our Yelp transaction platform, not having to spend a whole lot of time and money in producing the alerting and performance metrics that we otherwise would have."
With over 35,000 restaurant menus, 1 million menu items and 1,500 U.S. cities to manage, that would be an enormous lift. By relying on data analytics, "The biggest impact to our customers is through our transaction platform, which enhances our ability to track deliveries, ensure food orders make it on time and deliver the best service possible to hungry users," Wehner says.
Being able to understand this data is also invaluable to Yelp's community management teams. They are using analytics to review how well their Yelp Elite events are performing, the success of email campaigns and ultimately the value they're getting out of their community events.
With the battle for the food delivery market raging on, customer experience is king. As market players continue to innovate and expand their on-demand services, expect to see companies with data analytics strategies like Yelp's come out on top.