Hailey Mopas

9/12/20
MKTG 452

Target Market Analysis

Grubhub is one of the leading online and mobile food ordering services with the largest network
of restaurant partners. It helps customers to find and order food from wherever they are. The
app allows customers to type in an address, search for restaurants nearby, and track orders.
Grubhub is known for its convenience for delivering food right to your door without having to
leave the house. With social distancing as the new norm amidst the Covid-19 outbreak,
consumers are having to order takeout and use food delivery services. This report will describe
Grubhub’s target market to better understand how the company can expand and retain
customers.

Demographics
Age
Grubhub’s delivery app is popular among adults in 25-34 and 45-54-year-old age groups (Aliyan
2019). Given this trend, Millennials and Generation X are important to target because they are
comfortable with mobile devices, and purchasing online is easy for them. However, Grubhub
hasn’t reached a strong base with Generation Z consumers. This may be because most
individuals in this age group are in college and most likely eat pre-cooked meals. The data
below shows the demographic of Grubhub users in different age groups (2019).
● 18-24 years 5%
● 25-34 years 32.2%
● 45-54 years 32.2%
● 55+ years 20.7%

Gender
Grubhub’s main users are women making up 64.3% while men make up 35.7% (2019). In
couples, women tend to be the primary grocery shopper and cook. Because of this trend, I can
assume that women are the dominant performers for providing food for their family making them
more likely to use Grubhub services (Packaged Facts Food Carryout and Delivery 2020).

Income
Since Millennials and Generation X tend to have busy schedules, they are more likely to use
convenient services. This age group spends the most money on food and has higher
expenditures at restaurants (Packaged Facts Food Carryout and Delivery 2020). Segmenting by
income shows that lower-income consumers are most likely to eat pre-cooked meals while
higher-income consumers spend more at restaurants and delivery services.
● The median income level of users of Grubhub is $70,136.63 (Eunice et al., 2019).
Given the median income level, I can assume that higher education is also correlated with more
restaurant and delivery service spending.
Location
Grubhub is available in more than 1,700 cities across the United States (Molla 2017). However,
Grubhub’s most popular locations are in Texas, New York, Los Angeles, and Chicago (2017).
Given the locations, Grubhub targets urban areas where most people have demanding
schedules.

Psychographics
Dining out Attitudes
Food delivery users having their dining out attitudes. 20% of delivery service users dine out 4+
times/week and 47% of their primary reason is to treat themselves or satisfy a craving and 30%
use the service to try new food around their area (Schoenbauer 2020).Given this data, I can
assume that the target market spends the most on eating out.

Online Shoppers
Consumers who use Grubhub can also be individuals who enjoy online shopping. 25% of users
who like to shop online place online delivery orders weekly (2020). Online shoppers are more
likely to say that they will pay for convenience when dining out. Because of this consumer
insight, online shoppers are more likely to use Grubhub and other delivery services.

Work environment
Grubhub’s target market is consumers with busy lifestyles. 6 out of 10 workers like to stay at
their desks and continue working as they eat their lunch and ⅔ prefer to buy their lunch rather
than bringing lunch from home (Grubhub 2019). Individuals working in high paced and busy
work environments will use Grubhub more often so that they don’t need to leave work.

Usage
Grubhub is usually busy between 2-4 pm and 5-7 pm which are typical late lunches and dinner
times (Zaidi 2017). These periods also may indicate that consumers use the app mid-afternoon
to look over dinner options before placing orders. In 3 months, the information below shows how
much consumers used the service (Zion 2020).

● 50% have used the service 1-2 times

● 24% have used 3-4 times
● 12% have used 5-6 times
● 7% have used 11 or more times

Contactless Delivery
Due to the Covid-19 outbreak, 40% of Americans have ordered restaurant delivery more often
than they did before (Roberts 2020). Grubhub implemented safety and health protocols so that
customers and drivers can use contactless delivery. This pandemic has increased the demand
for orders that involve little to no contact. This benefits consumers because they do not have to
enter stores, reducing their exposure to others.

Consumption Constellations
The marketplace for food delivery services consists of Grubhub, UberEats, Doordash, and
Postmates. The list below shows the market share between each delivery service.
● 37.8% of consumers use Grubhub
● 36.0% of consumers use UberEats
● 19.9% of consumers use Doordash
● 9.8% of consumers use Postmates
Given this data of the market, I assume that the target market most likely uses other delivery
apps as well (Zion 2020).

Evaluation
After researching the target market for Grubhub, the main consumers are Millennials and
Generation X. This makes sense because this age group usually has the busiest individuals
from work and home life with young children. Grubhub targets these types of customers
because of the convenient service that they offer. However, I was surprised that Generation Z is
the lowest age group to use this delivery service. This may be because most college students
use their meal plans and have less disposable income. Generation Z is also known for spending
money on pre-cooked meals and fast food because it is inexpensive. With Grubhub, consumers
have to pay extra for delivery fees and tips, which is why people with higher incomes can afford
delivery services.

Online shoppers, individuals with busy lifestyles, and dining out attitudes are consumers’
consumption of using the service. Online shoppers enjoy ordering food online because of its
easy accessibility. Individuals with busy lifestyles like to order food and stay at their desks while
eating. Consumers who dine out more often like to spend the most money at restaurants. These
examples of consumer psychographics show that consumers who have these habits are more
likely to use Grubhub.

Suggestions
Since most of the users are women, I think that Grubhub should appeal to women with healthy
food options. Because most women have their primary concerns about food, they could partner
with healthier food restaurants that advertise their meals as fresh and nutritious (Packaged
Facts Food Carryout and Delivery 2020). This could help marketers appeal to women’s
concerns about health and diet.

Since the use of the app is the least amongst Generation Z, Grubhub could appeal to this age
group by offering student discounts. College students are always looking for inexpensive ways
to get food. Offering discounts or even free delivery specifically for college students can make a
big impact on long term loyalty to the brand. This would make college students overlook other
delivery apps that do not offer this.

During this pandemic, many families have been struggling financially and consumers like to see
companies give back to their communities. Grubhub could partner with local Food banks in the
cities that were most affected. Since the Food bank’s mission is about providing food for
families, the goals of each company align with one another. They could implement an option for
customers to donate and offer rewards if they do. Showing that the company is committed to
giving back, it can increase their target market loyalty because groups such as Millennials and
Generation Z care about corporate citizenship. For example, if a customer is stuck between
using the brand and another brand that doesn't give back to charity, most of the time they will
choose the brand that does.
 Works Cited

Eunice, Elena, Shannon, Hanine, Erin, Stan, SageStar, Methody, Dagamawit. (2019, November
3). Demographics: US Food Delivery Apps. Retrieved September 14, 2020, from
https:://askwonder.com/research/customer-demographics-demographics-us-food-
Delivery-apps-k1p2srk3y.

Food Carryout and Delivery. (2020). Retrieved September 14, 2020, from https://www-
marketresearch-com.ezproxy1.library.arizona./academic/Product/16224128.

M, Aliyan. (2019). Demographics: US Food Delivery Apps. . Retrieved September 14, 2020
from https://start.askwonder.com/insights//i-d-learn-primary-demographic-food-
-delivery-apps-specifically-doordash-postmates-d3kuselqf.

Molla, R. (2017, October 03). What's the biggest food delivery service in your city? Retrieved
from https://www.vox.com/2017/10/3/16384050/food-delivery-service-ubereats-grubhub-
doordash-city-takeout.

Roberts, C. (2020, Mat 21). DoorDash, Grubhub, Postmates, and Uber Eats: How Food
Delivery Services Perform. Retrieved September 14, 2020 from https://www.
consumerreports.org/food-delivery-services/food-delivery-services-apps-review/.

Schoenbauer, A. (2018, August 22). App-etizing Insights on Food Delivery Services.

Retrieved September 14, 2020 from https://www.numerator.come/resources/blog
/appetizing-insights-food-deliver-services.

Why You Should Consider Food Delivery. (2019, October 10). Retrieved September
14, 2020, from https://get.grubhub.com/blog/why-you-should-consider-food-delivery

Zaidi, A. (2017,, December 06). Which Food Delivery App Attracts the Most Appetites?
Retrieved September 14, 2020, from https://vertoanalytics.com/food-delivery
-app-attracts-appetites/.

Zion, A. (2020, August 04). Food Delivery Apps: Usage and Demographics - Winners,
Losers and Laggards. Retrieved September 14, 2020, from https://www.zion
andzion.com/research/food-delivery-apps-usageand-demographics-winn
ers-losers-and-laggards/