This almost never happens: Amazon ($AMZN) is giving up on a marketplace. After four years of attempting to take a bite out of the restaurant delivery industry, Amazon is shuttering its Amazon Restaurants operation. Originally launched in Seattle in 2015, Amazon Restaurants was aimed squarely at GrubHub ($GRUB) and Uber Eats ($PRIVATE:UBER) as an alternative for Amazon Prime customers.
Amazon Restaurants is slated to shut down today, June 24. In a statement to Geekwire, an Amazon spokesperson said that the company would "discontinue the Amazon Restaurants business in the US."
Amazon already shuttered the business in London last November.
As for why Amazon is giving up on food delivery (for now, at least - more on that below), one only need look at a map of the United States. We track hundreds of thousands of delivery nodes for GrubHub, Seamless, Uber Eats, Postmates, and Amazon Restaurants. When plotted together, it becomes clear that Amazon Restaurants simply came to game too late.
The map, embedded below for both the California and New York metropolitan areas, shows the state of affairs for Amazon eats as it shuts down.
If you can't see Amazon Eats in the maps in red, that's exactly why Amazon is likely throwing in the towel. For every Amazon Restaurant in Los Angeles, for instance, there were 125 competitor restaurants being delivered by DoorDash, UberEATs, Grubhub, and Postmates. In LA, Amazon delivered for 126 restaurants. The others delivered for 15,733.
In New York, the food-delivery capital of America, Amazon Restaurants delivered for 485 restaurants. The others deliver for 22,062. That means that for every Amazon Restaurants location, there are more than 45 for others.
Country wide, the data is even more one-sided: by its end, Amazon Restaurants delivered for 6,235 restaurants. The others did so for 842,746 restaurants. That's a ratio of 135:1. It's little wonder, then, that Amazon is packing things up in the food delivery space.
|
Open Restaurants |
US |
Seattle |
SF |
LA |
NY |
|---|---|---|---|---|---|
|
Amazon |
6,235 |
234 |
209 |
126 |
485 |
|
All Others (Sum) |
842,746 |
5,105 |
7,951 |
15,733 |
22,062 |
|
DoorDash |
264,194 |
1,371 |
1,978 |
5,561 |
3,780 |
|
UberEATs |
192,372 |
794 |
1,131 |
1,554 |
2,182 |
|
Grubhub |
214,580 |
1,366 |
2,349 |
4,657 |
10,486 |
|
Postmates |
171,600 |
1,574 |
2,493 |
3,961 |
5,614 |
It would be foolish to conclude that Amazon is out of the food delivery business for good. In May, Amazon led a $575 investment in Europe-dominating Deliveroo. Deliveroo ($PRIVATE:DELIVEROO) delivers for thousands of restaurants in The UK and Europe, and its footprint there looks a lot like GrubHub's does here.
Interestingly, Deliveroo CEO Will Shu is from Connecticut, and while he now lives in London, it wouldn't be too surprising if he had a personal interest in expanding his business in the states now that he has some Amazon capital and infrastructure at his disposal.
About the Data:
Thinknum tracks companies using information they post online - jobs, social and web traffic, product sales and app ratings - and creates data sets that measure factors like hiring, revenue and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.
Futher reading:
- Delivery Wars: the world's top-10 food-ordering services and where they battle for territory
- Data confirms that New York is the Grubhub delivery capital of America
- Uber Eats is entering an aggressive international expansion period: here's where
