Pocket Chef App: Mobile Food Industry Analysis

Introduction to the Pocket Chef Proposal

This report is the first of four parts in a broader proposal for a mobile application for smartphones and tablets called Pocket Chef. The application will allow users to input the foods available in their refrigerator or pantry. Those base ingredients are then synthesized and analyzed, and the recipes that can be crafted using those ingredients are supplied to the user. The industry code for this application — more commonly known as the NAICS code — is 722330, which covers mobile food services.

Before addressing the particulars of this application, including how it will be crafted, managed, and brought to market, this report first examines the wider industry. The questions addressed include when the relevant genre emerged, how useful or essential such applications are considered to be, how large the genre has become, how many users are currently active in the space, what forecasting exists regarding the future, and what overall sales volume looks like both historically and at present. A selection of charts and graphics is used to illustrate and explain key statistics. All sources used in this report are scholarly or otherwise reputable in nature.

Overview of the Mobile App Industry

Before examining the food service mobile app sector specifically, it is useful to consider the mobile app industry as a whole. Ninety-one percent of adults in the United States own a cellular phone, and of those, 61 percent own smartphones. The number of smartphone units in circulation is at least double that of personal computers. The aggregate market accounts for approximately 268 billion app downloads and roughly $77 billion in total revenue. Just over half of all app users have not paid for apps; however, 46 percent of users have reported being willing to do so or having already done so. These apps typically sell for five dollars or less, though some cost $20 or more — a price point that fewer than one in five users has been willing to reach. The most commonly used types of apps include search and portal tools (such as Google), entertainment, communication, commerce and shopping, and productivity tools (Clifford, 2014).

The food service mobile app industry is expansive and varied. It encompasses apps from specific restaurants, delivery facilitators such as GrubHub and UberEats, food media networks such as Food Network, and celebrity chefs such as Rachael Ray. The lines between these categories often blur — for example, McDonald's food can be delivered through a combination of Uber and McDonald's infrastructure, and cross-promotion between certain apps and certain public figures is common.

The Mobile Food Ordering and Delivery Landscape

While somewhat different from what Pocket Chef is designed to be, the mobile food ordering industry is growing rapidly. The food delivery app sector — exemplified by UberEats — is expanding to the point that restaurants risk being left behind if they do not engage with the mobile revolution. Online food ordering is projected to become a $38 billion industry by 2020. In some cases, a tenth of all food sold at a given chain already comes from mobile ordering. Mobile ordering can facilitate delivery or enable pre-ordering so that food or drink is ready upon a customer's arrival. Starbucks and Pizza Hut are examples of firms embracing this model. For Pizza Hut, which has offered delivery for decades, this is a natural extension. For Starbucks, it represents a significant operational shift (Taylor, 2016).

There are also many consumers of a "foodie" persuasion who use mobile devices not to order out but to prepare their own food at home. They may be inspired by something they saw on a cooking show or motivated by the desire to use what they already have on hand rather than purchasing additional groceries. This approach keeps pantry and refrigerator contents efficient and saves time. This is precisely where Pocket Chef fits in. Many people are pressed for time or money due to other commitments or limitations, while others are simply curious about what they can make with their available ingredients.