Food delivery or grocery delivery? Which gig pays more? Since COVID arrived in the United States in early 2020, the gig economy saw two significant rideshare and food delivery shifts. In short, rideshare demand plummeted while food delivery demand soared. 

Rideshare demand plummeted as much as 80% year-over-year in April. People when into quarantine and practiced social distancing behaviors. Restaurants saw a decline in dine-in customers as a result. A recent survey by the National Restaurant Association found that across the United States, 110,000 food and drink businesses have permanently closed or for the long-term. That is 17% of all restaurants. As a result, demand for food delivery services took off.

Many rideshare-only drivers had to adjust to doing more food deliveries if they want to continue with the app-based gig work. Lyft even started to enter the food delivery space after being a rideshare-only platform since its founding. Meanwhile, new opportunities in grocery delivery emerged. Grocery delivery services also saw an increase in demand. In the spring, Instacart saw a 500% year-over-year increase in order volumes.

I was curious. So did the Pandemic increase earnings for food delivery drivers? For those looking into the booming grocery delivery space, which pays more, grocery delivery or food delivery?

From February 2020 to August 2020, I was doing food delivery. And since April 2020, I have been driving both food delivery and grocery delivery under the pandemic’s social distancing conditions, i.e., contactless delivery, personal protective equipment, the whole nine-yard. 

I recently gathered data from my payouts from both types of services to see if the pandemic caused an increase in couriers’ earnings. I used data from my Caviar payouts to see how COVID-19 affected income in food delivery. I also compared payout from grocery deliveries (completed on the Shipt platform) with Caviar’s to see which type of services pays more overall.

I completed many orders, but I only selected one of out every three orders to examine. Also, I excluded bonus payouts for milestones and other incentives on these platforms.

Data Sample:

Food delivery before the pandemic:

I looked at 71 food delivery orders that I completed on Caviar from February to mid-March. This period was before Oregon leadership mandated social distancing behaviors.

Food delivery during the pandemic, before grocery started:

I looked at 89 food orders completed on Caviar from mid-March to late April. This period was during COVID lockdown, but before I started doing grocery deliveries.

Food delivery during the pandemic, after grocery started:

I looked at 111 orders that I completed on Caviar between late April 2020 and August 2020. This period was a time of widespread state lockdowns and up until Caviar and DoorDash (which acquired Caviar) merged into one platform. I did both food delivery and grocery deliveries in these months.

Grocery services before the pandemic: 

No data was available for this condition since the driver providing the data did not start driving grocery until April 2020, after state mandates went into effect.

Grocery services during the pandemic:

I looked at one hundred ninety-nine grocery delivery orders completed on the Shipt grocery delivery platform from April 2020 through August 2020.

Results:

Table 1 Food Delivery, sample size (n)

Table 2 Grocery Delivery, Sample size (n) = 199

Stable Food Delivery Payout

Safe to say, the payout model of the food delivery platform Caviar did not change during COVID.

As you can see, the average payout per order did not change much from before and during COVID on food delivery. On average, it was $6-8 per order. Typically, you can do about 2-3 orders an hour. So, it works out to be around $16-24 dollars per hour (excluding tips). This rate is consistent with what Caviar advertises (up to $25 an hour). The average courier reports making about $16 an hour with Caviar on Glassdoor.

Customers Tipped More

But the average tip increased significantly as the COVID pandemic went on for food delivery orders. Customers tipped on average $1.18 (37%) more for delivery services the first month after lockdown mandates went into effect. As the summer approached and pandemic conditions cemented, customers tipped on average $2.57 more per order than before the lockdowns. Tip earnings went from $3.16 to $5.73. That is about a 90% increase!

Grocery Delivery Beats Food Delivery

Grocery deliveries, on average, had higher payout, tips, and overall earnings per order. The difference is most considerable when it comes to tips. I think this difference is because grocery orders generally are more significant in value than a meal. As a result, a percentage tip would result in more money for the couriers.

If you’re a driver who saw their rideshare income plummeted because of COVID-19, switching to grocery delivery. You’d earn more than switching to food delivery gigs.

Focus On The Tips

Always focus on earning tips. Tips are something drivers can control or have an influence over by providing quality service.

It can be very profitable for drivers who do multiple gigs to add a grocery delivery into their gig stack and focus on providing excellent service to earn more tips.