How has the pandemic transformed food delivery in Luxembourg?

The pandemic saw food delivery services mushroom in Luxembourg, growing a market that was largely dormant before, but change did not last in all segments.

Luxembourg went into lockdown on 16 March and restrictions began to be lifted on 20 May. And while the world has since moved on to other crises, the Covid-19 pandemic’s influence on consumer behaviour has proven to be long-lasting, particularly in the food sector.

“We saw an extraordinary acceleration. Digital transformation processes that in Luxembourg would have naturally occurred over years were concentrated into a few months, revolutionising the local food delivery market,” said Emanuele Chichi, CEO of Wedely, in an interview.

Make it better, do it faster

Customers now have higher expectations than before, the food delivery service’s co-founder said. Not only has the demand for takeout increased, but people want “everything immediately and with the same quality as in a restaurant.” Even a delivery being a few minutes early can be a problem, he said. “Customers have become considerably more demanding.”

At the same time,  there has been an “amazing evolution” of the sector, he said. The boom in the demand for delivery services has seen the likes of Uber Eats, Goosty and Wolt entering the Luxembourg market since 2020. Other services include Takeaway, Foostix and MiamMiam.

Goosty went bankrupt in 2024, showing that the market isn’t big enough for everyone to get their slice.

To improve customer experience, Wedely first worked on building relationships with the restaurants using its platform to ensure quality standards are met. Since 2024, the company has been working on improving its website and app, for example reducing the number of clicks needed to make a purchase.

People tend to order the same things – often from a favourite place – said Chichi, with AI now using customer data to make suggestions and focus on user preferences.

Wedely competitor Wolt launched in early 2024, with Uber Eats now also an option in addition to other service providers © Photo credit: Wolt

A switch in mindset

Customer behaviour is also reflected in the actions of restaurants. Some eateries only began offering delivery during lockdown, planning to stop once restrictions were lifted. After realising the profit potential, they continued working with platforms like Wedely and still do so, said Chichi.

“Before the pandemic, many restaurant owners viewed delivery as an accessory service. Today, they have understood that it represents an essential complementary channel, capable of significantly expanding their audience and increasing revenue even during periods of lower foot traffic in the establishment. Now they call us to tell us that tomorrow is, for example, Valentine’s Day and that they have put three more people to work,” said Wedely’s CEO.

The pandemic also increased the number of ghost kitchens in Luxembourg, said Chichi. These delivery-only restaurants cook and deliver Indian food, pizza, fried chicken and so on, saving on expenses like rent, staff and decoration. For the Wedely co-founder, ghost kitchens offer an answer to the demand for variety.

A rising tide lifts almost all boats

While  some trends in customer consumption were accelerated by the pandemic, grocery store delivery did not share the same fate. “The pandemic did not change the need for grocery store delivery. It was already available in many places in Europe and in the world. But in Luxembourg it has not developed,” said Chichi.

The Luxembourg Confederation’s CEO, Tom Baumert, shares that view.

Tom Baumert, CEO of the Luxembourg Confederation © Photo credit: Luxembourg Confederation

The Luxembourg Confederation’s CEO, Tom Baumert, shares that view.

“Our members tell us that, especially when it comes to food, the consumer wants to touch it with their own hands. This is also why the supermarket segment is still growing in Luxembourg,” said Baumert. The collective size of food stores in the country has increased by over 30,000 square metres of retail area since 2019, according to a study by the Luxembourg Confederation, the Chamber of Commerce and the Chamber of Skilled Trades and Crafts.

“More square metres indicate more employees. Fewer square metres is generally a bad sign because it shows less investment and less trust in the market,” said Baumert.

Bakeries and butchers, on the other hand, have become less popular, as evidenced by a shrinking number of total stores. For Baumert, this points to a tendency among customers to do all their shopping in one big supermarket.

Grab-and-go

That includes the rise of grab-and-go meals in supermarkets.

“A big part of supermarkets is now dedicated to food-to-go. We saw this a lot less in 2019. Thinking back to the pandemic, people working in offices would not go to restaurants because they had to put on a mask. They took a meal from the supermarket and ate at their desk. Looking at myself and my employees, we did this too and we simply didn’t stop,” said Baumert.

Punters do not, however, go to bars like they used to. Surface area in square metres dropped the most for bars and pubs, the Luxembourg Confederation’s study found. That is especially true for places that only serve drinks. “Bars have been closing, which was accelerated by the crisis and they never came back. They became restaurants or fast-food spots,” said Baumert.

And while fast-food joints received a boost with food delivery, the pandemic also proved a boom for local products.

“The extremes were a little bit pushed. In Luxembourg, a big part of the population’s purchasing power was not affected. Many of people work for the state and in the banking sector. Those working in the private sector felt it more, especially those working in restaurants, retailers and some crafts people,” said Baumert.

Just because these changes in customer behaviour happened during the pandemic, does not mean they only happened because of it, making this unique period a catalyst for change rather than something that flipped the world upside down – and was then forgotten.