Uber Eats Is On Fire
Uber Eats is on fire. The number of deliveries in the United States for December grew 17% from November and 10X from the first full month of operation in May.
Looking at Superfly Insights revenue in 4 of the 5 international markets UK, France, Australia and Mexico grew at an average 14% MoM in December. South Africa, its most recent launch, grew at 100% which is now the standard for Uber Eats in the first few month entering a new market.
One of Uber’s key success factors in entering new markets is smart use of discount for first time users. The graph below details the % of users and % of transactions that received a discount in each market.
One of the fascinating aspects of Uber’s go to market strategy with ‘Eats has been their smart use of discounts. In the UK, where Uber Eats launched in June 2016, Uber is keeping the % of discounts per delivery high, leveling off just under 50% — even 6 months into the UK market.
One might think that Uber, with it’s massive cash reserves, is doing this in every market. But Superfly Insights shows that Uber is maintaining a high level of discounts only in markets where it has stiff competition.
Uber makes sure almost 100% of the users see a discount on their first transaction and then reduces the number based on the level of competition in the specific market. While this makes sense intuitively, Uber has transformed this into an art.
(1) Superfly Insights has a panel of 2.5mm users. 25% domestic, 75% international.
(2) The Uber panel contains 100k customers