Specialist
Former director at Just Eat plc
Agenda
- Just Eat Takeaway.com (LON: JET) (AMS: TKWY) – marketplace vs delivery mix trends and gross margin implications
- Cost and benefit of salaried and agency riders vs gig economy contractors
- Order density and rider utilisation trends
- Average basket size trends and restaurant commission rate
- Impact of easing lockdown restrictions on platform growth outlook
Questions
1.
How is the AOV changing for Just Eat and the marketplace? What distinctions should we make when assessing delivery vs marketplace AOV?
2.
Just Eat indicated EUR 22.35 or GBP 20 AOV for 2020. Do you think the trajectory could go sideways? Presumably it rises with inflation but would it increase in real terms?
3.
Is there any potential negative mix associated with people ordering at different mealtimes such as lunch or breakfast? Deliveroo says there are 21 meal events in the week. Do AOVs decrease as people start to order across other mealtimes?
4.
Do you expect the AOV to change, particularly with branded restaurants as those become more commonplace on the Just Eat platform? It plans to bring on more branded inventory to create a similar proposition to Uber Eats and Deliveroo. Do you think the inventory mix will impact AOV positively or negatively?
5.
How are the branded meal add-ons set up? Are they partnerships with restaurants?
6.
How quickly might the mix evolve between marketplace and delivery? If Just Eat fulfilled 15% of UK orders in 2020, presumably the exit rate at the end of Q4 was much higher, 20-25%. What optimum mix will Just Eat target for marketplace and delivery?
7.
To what extent is the incremental business adding profit vs cannibalising existing marketplace orders?
8.
How does bringing on new QSR [quick-service restaurant] inventory impact the existing cohorts?
9.
What assumptions are you making around the order frequency? You mentioned the range of cuisine types and restaurants within the categories, but how frequently are customers ordering?
10.
What about the acquisition cost for new customers? If newer customers are placing about 3-4 orders per year, how many of those are typically logistics, delivery orders vs marketplace? How quickly have they migrated to marketplace?
11.
What’s the rough percentage share of new customers for delivery vs marketplace in 2021?
12.
How is the average commission developing when accounting for more delivery orders on the platform?
13.
Do you think the commercial dynamics between restaurants and platforms will change as markets open up and people can travel to restaurants? Consumers and restaurants were somewhat beholden to the platforms for the last 12 months, but do you think those discussions will change once people can dine-in again?
14.
How do you think the customer experience on the platform will be impacted as lockdowns ease and businesses reopen? Do you anticipate delivery times lengthening and the customer experience deteriorating?
15.
Do you think the opening-up challenge impacts one platform more than others? For example, Deliveroo has a lot of inventory that’s conventionally dine-in whereas Just Eat has a huge marketplace business across takeaway and QSR restaurants. Would Deliveroo be more impacted by this trend?
16.
You said restaurants are particularly busy with dine-in covers on Fridays and Saturdays. Do you think the larger branded chains with big commercial kitchens will be at an advantage because they’ll have better SLAs [service-level agreements] on the platforms, faster delivery times and potentially rise through the algorithms to be listed at the top? Whereas smaller independent restaurants will have smaller kitchens and fewer staff. Do you think this would impact the share of branded QSR-type restaurants which pay a lower commission vs independents?
17.
Can you expand on Just Eat scaling the salaried and agency riders? How big do you think its UK rider network is? How big is the Deliveroo network?
18.
How do you think the delivery cost varies depending on the rider category, whether they’re a directly managed rider vs Scoober vs Stuart?
19.
Alternative platforms indicate that riders earn about GBP 4.50 per drop on average. Is that a comparable cost with Stuart?
20.
How many drops would the delivery riders ideally want to make per hour? It seems really hard to get above 1.5-1.8.
21.
Can two drops per hour be achieved under the competitive environment, given that Uber Eats and Deliveroo are presumably investing in very similar locations?
22.
How do you think rider cost will evolve as everybody tries to scale up capability and bring more riders into the platform? Presumably greater pay per drop to incentivise someone to choose Deliveroo over Uber Eats or Just Eat over Deliveroo? How can platforms keep a lid on rider cost?
23.
How effective are promotions in developing stickiness? Just Eat’s main one is free delivery or significantly discounted delivery, whereas competitors seem more inclined to use vouchers for the basket.
24.
How much pricing flexibility does Just Eat retain on the delivery part? How easy is that to reintroduce? It’s a fantastic lever for profitability because the platform keeps it all, whereas to get an incremental GBP 2 from a marketplace order with 20% commission, the basket needs to increase substantially to have the same impact.
