Deliveroo said today the number of people signed up to Plus had doubled since it began offering a year’s free trial to customers through Amazon Prime in mid-September. Specific numbers weren’t given.
Plus subscribers get free deliver on orders for £3.49-a-month. Deliveroo said last month it would offer Amazon Prime customers a year’s free trial of the service under a partnership deal. Amazon Prime customers still have to opt in. Amazon is a significant investor in Deliveroo.
Deliveroo said it was also seeing good progress with Hop, it’s new on-demand grocery delivery service in partnership with Morrisons. The service is meant to compete with new fast grocery services like Gorillas, Getir, and Zapp.
“These are just two examples of innovations introduced this quarter that are consistently improving our consumer value proposition,” said founder and CEO Will Shu said.
Momentum in Plus and Hop helped deliver a surge in orders for Deliveroo over the last few months. The company said gross transaction value was up 58% to £1.6 billion in the third quarter.
Deliveroo upgraded forecasts for growth in order value across the year, saying it now expects gross transaction value to jump by 60% to 70%. The company had previously guided growth of 50% to 60%.
“While we are mindful of current and potential macroeconomic disruptions and uncertainties, we expect further strong performance in the remainder of the year and we are increasing our full year GTV growth guidance,” Shu said. “We remain excited about the opportunity ahead and our plans to deliver better value to our consumers, help our restaurant and grocery partners to grow, and provide further opportunities for riders.”
While order volumes are growing strongly, customers are ordering smaller amounts. Average order size declined 4% to £21.40 in the quarter. Smaller order sizes could begin to eat in to Deliveroo’s profit margins if costs remain fixed but the company said forecasts for full-year profit margin remained unchanged at between 7.5% and 7.75%.
Shares rose 7.6p or 2.6% to 298p. The company still remains well below its 390p IPO price.