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ChowNow Business Model and Strategy

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Wouldn’t it be awesome for restaurants if they can save themselves from paying a hefty commission to third-party food ordering apps? Well, ChowNow has answered your prayers! ChowNow, a food ordering app is famous among restaurants, and rightly so. Unlike other apps, ChowNow doesn’t receive a commission on orders; instead, restaurants have to pay for the monthly service, and restaurants get a dedicated marketing team to set up a website and an app, and other features. ChowNow saves a huge chunk of profits for food establishments as they don’t have to pay heavy commission to the app.  The app is hugely popular in the United States and was founded by Christopher Webb and Eric Jaffe in 2011, with headquarters in Los Angeles, California.  For customers, the ChowNow app is just like Grubhub or UberEats.  

In the times of pandemic, when restaurants found it hard to survive and provide the commission to delivery apps, ChowNow was specially mentioned by Forbes in an article for helping restaurants to make it through the crisis. The slogan of ChowNow is, “Helping local restaurants thrive.” 

If one is in the food business, having an association with DoorDash or UberEats seems ubiquitous. These apps allow businesses to get in touch with users and increase revenue. However, the problem for food businesses with these apps is that they demand a high commission, which becomes a problem for businesses, as a major chunk of profits goes in commissions- anywhere between 20% to 40%.  

Business Model of ChowNow: The Work Flow

The vision of ChowNow is to ensure that small, local restaurants don’t go out of business because of high commission. They decided to do something about it by bringing ChowNow to reality. It is available on Android and iOS.   

The business model of ChowNow is quite simple; they have eradicated any complexities so that businesses find it easy to use. Since ChowNow doesn’t charge a commission per order, they offer a paid monthly subscription. ChowNow pricing is transparent- It charges restaurants $149/month and a one-time $399 setup fee per location. When one opts for an annual plan, it costs $119/month, and the setup fee goes down to $199. A 2-year plan costs $99 a month and a setup fee of @199. Other services include comprehensive training, an ongoing marketing strategy, an iPad to consolidate orders, and 24/7 support.  

ChowNow doesn’t offer a delivery service. Restaurants that don’t wish to hire dedicated drivers are not out of luck- ChowNow has partnered with delivery services, such as DoorDash, UberEats, Postmates, etc., in different areas. The aim of ChowNow isn’t to give these companies a run for their money but to make it affordable for different restaurants- big or small.

How ChowNow App Works for Customers 

ChowNow app is more or less the same for customers as any other online food delivery app. When you download the ChowNow app, you have to enter the location, and it shows the available restaurants from where you can order. Add items in the cart and checkout. The app is beneficial for users as not only they help small businesses by using ChowNow app, but they also save themselves from the heavy price, sue to the high commission on other apps; many restaurants increase their prices on the app to compensate, which affects customers as they have to pay from their pockets. 

Market Stats and Revenue  

Chownow - Market stats and Revenue

Currently, market stats depict that ChowNow stands at #3 in food online ordering system and delivery and is becoming a much sought-after option for restaurants. The market share of ChowNow is 15.62%, with more than 6854 companies using this software.  ChowNow makes $93.1 million a year.   

Benefits of Choosing an Online Ordering System Like ChowNow  

1. Increase Revenue  

The first and foremost benefit of using ChowNow is the increase in revenue. It’s not as expensive as other apps, and a flat monthly fee means more money back in your restaurant. One can keep more of the revenue from every online sale rather than having to shed it to third-party vendors in the form of commission.  

2. Capture Customer Data  

Data is crucial; it drives the business. More information you get about your customers, the better. Customer data helps you know the preferences of your customers, which in turn helps you provide a better experience to your users. It is a great way to devise marketing strategies that actually work in your favor.  

3. Increase Customer Engagement  

Online platforms are a great way for your business to increase customer engagement. More and more customers get to know about a restaurant when there is a provision to order from it online. Platforms like ChowNow act as your marketing agents that bring more customers.  

4. Boost Customer Loyalty  

Apps like ChowNow are a great way to boost customer loyalty. Customers not only get to know about a business that’s listed on the food ordering app, but they start trusting the business, which helps the restaurant increase revenue and has a good reputation.  

5. Uninterrupted Sales  

It’s a dream of every restaurant to have uninterrupted sales, and that comes to reality with an online ordering system. No matter if the weather is harsh or there are some other reasons, your restaurants never have any interruption when it comes to sales.   

6. Electronic Invoicing  

Receiving orders over the phone is outdated; also, it’s susceptible to errors. An electronic invoice avoids any confusion, and the customer is charged for what he/she has ordered. It offers utmost transparency as the customer can see what he has been charged and how much corresponds to every item.  

7. Real-time Metrics  

Real-time metrics such as the number of orders completed, pending orders, revenue generated, best-selling products, etc., are important for any business, and this data is a great way to help restaurants devise strategies to improve their business in the future.  

8. Online Payment Gateway  

Customers demand convenience and providing them a provision to order food from the comfort of their homes and pay it through multiple payment modes, such as debit cards, credit cards, e-wallets, etc., is the ultimate convenience which is provided by online ordering systems like ChowNow.  

9. Tailored Experiences  

Apps like ChowNow are known for providing a personalized experience to customers. It takes care of the preferences of customers and provides them with choices that are best suited for them. This way, food establishments can take care of the likes and dislikes of their customers.  

Frequently Asked Questions (FAQs)  

ChowNow-FAQ

Que. How much does it cost to build an app like ChowNow?  

Ans. To create a custom app like ChowNow, the budget is around $15,000 to $ 25,000. The cost might vary depending on your feature requirements. A ready made grocery app may cost you approximately $10,000.  

Que. How Much does ChowNow Make? 

Ans. ChowNow’s revenue is $93.1 million a year. 

Que. How much is ChowNow Delivery Fees? 

Ans. The delivery fee is calculated before the user confirms the order. Usually, it is $3 per pick up plus $3 per mile inclusive of the tip. 

Que. Is ChowNow Reliable? 

Ans. ChowNow is trusted by millions across the globe and is highly reliable. 

Que. Is it possible to develop an app like ChowNow?  

Ans. Sure, we would love to transform your dream app into reality. At Cerebrum Infotech, we offer customized products that are robust and scalable. You can get it customized exactly how you want, and we will deliver it to you at the earliest. 

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Jeevanjot Kaur

Jeevanjot firmly believes in the power of putting together words and the impact it creates on a reader’s mind. She loves writing about technology and trends that shape the industry. In her free time, you will find her admiring nature and its creator.

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