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Digital Transformation Coronavirus Digital Transformation Festival

What the food and beverage industry can do to future-proof their business for a post-coronavirus world


By Shawn Lim, Reporter, Asia Pacific

March 26, 2020 | 8 min read

As stricter social distancing measures for public venues and social activities are introduced by governments around the world to reduce the risk of further local transmission of the coronavirus, restaurants are forced to reduce their in-dining areas or stop operations altogether.

They are turning to food delivery as a way to sustain their businesses and keep serving customers, who have been advised to stay at home. This has led to an increased demand for takeout and deliveries.

Food delivery company Deliveroo has seen over 600 new restaurants join the platform since late January in order to extend their sales through delivery.

Since March 1, there has been a 50% jump in the number of restaurant sign ups, compared to the previous month.

“We are encouraging them to use Restaurant Hub (previously called Restaurant Home), an online portal that provides data and insights on how their delivery services are performing, as well as another portal call Marketer to set up their own marketing offers to consumers on the Deliveroo app,” a Deliveroo spokesperson explains to The Drum.

“We can also utilise our data and insights to look at what customers are ordering more of in recent weeks, and work with our restaurant partners on relevant menu engineering, to offer dishes which are immunity-boosting for instance.”

The spokesperson adds: “For example, Grain is offering a Feel-Good Salad with ingredients like smoked salmon, kale and broccoli, while Selegie Soya Bean is offering a Lou Han Guo Chrysanthemum Herbal Tea with no additional additives, exclusively on Deliveroo.”

How the F&B industry can cope with coronavirus

Similarly to how the pandemic has forced businesses to adopt flexible work policies as people work from home, this is an opportunity for the food and beverage (F&B) industry to think about how to digitally transform and future proof their business as they scale back their business during this period.

Presently, in the F&B sector, technology like artificial intelligence is traditionally only used to simplify operations.

When it comes to understanding food trends, F&B businesses would pore over consumer studies, which would be a long laborious process as they would have to design the study, find people to survey, tabulate the results and then interpret that data and come to their own conclusions.

Utilising AI coupled with anonymised search and other online data means F&B businesses can get massive amounts of data processed in real-time as AI examines hundreds of thousands of data points to provide what is essentially a census of the population in real time.

“Demand for takeout and deliveries is increasing with widespread lock-downs and home confinements being implemented in many parts of the world,” explains Ian Chapman-Banks, the chief executive of AI solutions company Sqreem that works with F&B businesses to digitally transform their operations.

“To help F&B brands plan better, we are able to consolidate and analyse data to discover when, where, and what people are looking for. Which means that we can see when demand spikes, where it is coming from, and for what sort of food items.”

He continues: “This helps food and delivery services streamline operations and maximise efficiencies in the face of limited resources during this period. Companies can also limit food wastage by accurately anticipating demand while making more efficient use of limited human resources for food prep, deliveries and the like.”

One such F&B company currently doing this is Ebb & Flow Group, as it believes the amount of data available today is huge, and will only continue to grow. This means it has no choice but to build its data capabilities to stay relevant and keep up with competitors.

Its dark kitchen, called Wrap Bstrd, uses behavioural data capabilities and pattern analysis powered by Sqreem, with the combined expertise of the analysts, chefs, creatives and branding experts within Ebb & Flow Group’s Dark Kitchen Lab.

Tapping on over 200,000 individual data points to map behaviours and trends of distinct consumer groups in Singapore, Dark Kitchen Lab was able to analyse customer journeys, predict demand, and map behavioural intent to purchase.

Dark Kitchen Lab studied flavours, ingredients, consumer preferences and trends and was able to pinpoint the meals that office workers in the central business district wanted.

It found that target customers like flavours from local comfort food such as hawker dishes and that they care about health trends. Customers also prefer to consume their food in a convenient, fuss-free manner.

“We use AI to craft concepts, develop brands, inform marketing decisions and even help companies make key strategic and business decisions,” Philipp K. Helfried, the chief investment officer of Ebb & Flow Group tells The Drum.

“Not only does using AI give us insights that assist us with taking the guesswork out of product, brand and menu creation, it can go even further and help us understand when best to reach our audiences and through which marketing or advertising channels.”

He adds: “For example the brand positioning, tonality, and identity for Wrap Bstrd was made to stand out from the crowd and stemmed from the insight garnered.”

For Deliveroo, it uses data analytics to match supply and demand, estimating rider supply per area based on historical data and predictable circumstances to ensure we have the right number of riders on the road in the right place at any one time.

This allows the platform’s rider supply planning team, who are responsible for the operational performance of the delivery network, to be always prepared all year round for any hikes.

Deliveroo has also invested in a dispatch proprietary algorithm Frank to enable efficient delivery process. Acting as a nerve centre, Frank is designed to consider various factors including riders’ profiles, distance, weather and duration of orders to evaluate the most efficient way of distributing to ensure all orders reach customers in the shortest possible time, even during busier periods.

“Since it was introduced in 2017, it has helped to improve delivery time for meals by nearly 20%, with Singapore being one of the most efficient Deliveroo markets globally,” the Deliveroo spokesperson says.

“Riders can now complete more deliveries per hour as they travel with food for an average of just six minutes, allowing them to make more cash without working extra hours. Our aim is always to deliver food to customers’ doorsteps as efficiently as possible.”

The spokesperson continues to explain the personalised experience which includes a machine learning model that predicts a user’s preference for a given restaurant based on historical data and suggests those restaurants to be ranked higher. "They’re therefore seeing more of the food choices they want and less of those they don’t want. From a restaurant perspective, AI also helps with estimating overall restaurant preparation time referencing the same dishes from previous orders, in turn reducing overall rider waiting time at restaurants.”

The F&B industry, post-coronavirus

On top of using data and analytics to learn their customers’ behaviours during and beyond the coronavirus pandemic, AI can also potentially be used in the F&B industry to improve sustainability of the industry by optimising food chains right from the very top, all the way down to reducing food waste within the restaurant itself.

Utilising AI data to test out new ideas and concepts within eight to 12 weeks with the dark kitchen concept means the ability to experiment and fail fast can pave the way for budding food entrepreneurs and would result in a more vibrant F&B scene altogether.

It is also feasible that the use of AI could also potentially open the doors for cross-industry applications. For example, if someone is on a medical diet, AI could help pair him or her with suitable restaurants or dishes.

There is no doubt these are dark and gloomy times for the F&B industry as the fallout from the pandemic could see it lose billions of dollars and cut millions of jobs. Future-proofing their businesses now will save them in the long run.

This piece was published as part of The Drum's Digital Transformation Festival, ongoing throughout March and April. Find out more details here.

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