Deliveroo launches ad platform in the UK
Deliveroo, the food delivery company, has launched its own advertising platform in the UK.
Deliveroo Media and Ecommerce will allow brands from July to advertise to customers with offers across its app, website as well as social media, email and push notification campaigns.
Ads will also run across Deliveroo’s order tracker page for the first time and new formats will be launched in the coming months in addition to the current sponsored search listings already available.
Delivery-only “Editions” kitchens and rapid grocery delivery “HOP” stores will also come under the advertising proposition so brands can send content and samples to customers.
Criteo, the commerce media company, will supply the ad tech and media sales services to Deliveroo.
Deliveroo has said advertising on the platform will include partnerships with restaurants as well as FMCG companies mainly on the grocery side in a way that is “mindful of the consumer experience”.
This follows a trend of retail companies moving into media and advertising sales like Boots Media Group launched last year, and Tesco and Dunnhumby this year, as well as Walmart, Target, and Kroger in the US previously.
Online retail giant Amazon currently holds an 11% stake in Deliveroo. This was previously 16% before it sold part of its share when Deliveroo floated on the London Stock Exchange last year.
Deliveroo’s share price has dropped 68.68% in the last year, currently listed at 89.14 GBX.
In its first annual results since its public offering in March 2021, it reported revenue was up by 60% but also listed increased losses because of higher costs in rider expenses and marketing.
Eric French, chief operating officer at Deliveroo, said: “Advertising revenue is a small part of Deliveroo’s current model but a big opportunity and a lever the company can pull to increase net revenue.”
He added: “Deliveroo has over eight million monthly active consumers, many of whom are ordering with us on a weekly basis, so we have an engaged and valuable audience for brands to connect with. Our new advertising platform will enable restaurant and grocery partners to tell their story emotionally and effectively whilst ensuring Deliveroo customers continue to receive a food-first experience.”
Deliveroo has said it aims to reach an adjusted EBITDA margin (as a percentage of gross transaction value) of 4%+ by 2026, with more growth potential from afterwards.
Deliveroo currently operates in 11 markets, with more than 170,000 restaurants and 13,000 grocers on its platform, and its says it plans to roll out Deliveroo Media and Ecommerce in the UK before it does so globally.