I tested all advertising channels, from contextual advertising to radio, reached the profitability ceiling of advertising, and generated revenue of 4.9+ million rubles from ads excluding branded queries. A description of the case and conclusions about regional food delivery markets are in the article.
Beginning
I joined a regional company delivering sushi, pizza, and hot meals as a Marketing Director. The company already had a market reputation and acquired customers through its brand and LTV, but advertising for new customers was performing poorly: the ad budget was 20,000 rubles per month, with no analytics or understanding of profitability.
Since food delivery customers generate highly immediate demand, it was necessary to set up advertising campaigns for “hot” demand: search campaigns for sushi, pizza, burgers, and other items from the company’s assortment. Given that cancellations in this business after placing an order are almost nonexistent, standard Yandex Metrica was sufficient to track cost per order.
A minimal advertising budget for each delivery category (pizza, sushi, etc.) made it possible to get the first orders and confirm that advertising works.
Connecting analytics and call tracking
Connecting an end-to-end analytics service made it possible to account for calls, returning customers, and the exact cost of an order, including cancellations, which were few thanks to the well-organized call center.
By combining tests of ad reach, strategies (manual or automated), and daily budgets, it was possible to achieve:
- “pizza” queries — 96 rubles per order
- “food delivery” queries — 66 rubles per order
Of course, customer acquisition cost depends not only on the quality of ad setup. Product assortment and pricing are important — prices should not be significantly higher than competitors.
It is also necessary to have a well-optimized cart, upselling of additional high-margin products by call center operators, and fast delivery.
Reaching the profitability ceiling in search advertising
In search advertising in a million-plus city, profitability from the first order was achieved at up to 150,000 rubles per month in ad spend.
After that, the business owner has two options:
- increase the cost per order relying on LTV and lose profit on the first order (operate at a loss),
- or freeze the budget at first-order profitability and not increase budget or bids.
We chose the second option. It is important to remember that federal aggregators such as Yandex Food and Delivery Club can afford to spend more on advertising than smaller delivery services.
Official reports
In the official report from Yandex Direct managers, we can see the quality of the advertising campaign setup for our website compared to competitors and federal aggregators.
Key results
The report shows the progress of advertising performance over 2 years.
- The average cost per click is lower, while CTR is higher
- Traffic volume is not lower than competitors, even though they spend more
- It was possible to match federal players in budget but get more clicks
- Strong cost-per-customer metrics and reaching a leading market position in advertising (50+ advertisers)
Over 12 months, I managed to bring the click volume to third place. For keywords related to food delivery in this region, there are over 50 advertisers competing.
It would have been possible to rank even higher, but the unit economics no longer made sense.
Costs are also high, but two orders of magnitude lower than competitors — which indicates that the same volume of targeted clicks was achieved with significantly less spend.
Another chart clearly demonstrates this for the query “food delivery.” A high CTR and low cost per click indicate that work was done on keyword selection and ad quality improvement. This can be seen as a direct result of optimization efforts across the advertising campaigns.
A similar trend can be seen for queries in the “sushi” category. Pay attention to the region indicated below the chart. Competition in this category is the highest. Despite having a CTR comparable to competitors, the cost per click remained significantly lower, even after the market-wide budget surge starting in February 2022.
We caught up with the regional advertising leader as they gradually reduced their market coverage. As a result, by September 2022, the campaigns I managed brought the regional food delivery service I worked with to a leading position in advertising within the market.
You can see that the figures stated in the headline are not случайны — these results were consistently achieved over more than a year.
The previous leader may have been losing coverage due to a clearer understanding of unit economics, changes in advertising strategy, or other factors.
By the way, despite an overall 15–20% decline in the food delivery market in the region, the company managed to maintain its revenue thanks to advertising-driven acquisition, including after September 2022.
End-to-end analytics reports, after implementing call tracking and integrating it with the CRM, looked like this:
Average order value
In most cases, the average order value is driven by the delivery assortment and the head of sales, who builds an effective upsell system. Additional sales also come from items like sauces and drinks featured in “frequently bought together” blocks on the website and in the cart.
Working on the sales funnel is a комплексная задача: it’s not enough to attract quality traffic — you also need to maximize order value and ensure efficient delivery. In this area, recommendations from a marketing specialist are usually advisory rather than decisive.
Conclusions: how many orders can a regional food delivery company get without a well-known brand?
As mentioned earlier, much depends on pricing and service quality. However, assuming that most companies offer a similar level of service and food quality, we can say that with properly set up advertising, a delivery business can generate ₽490,000+ in revenue per 100,000 city residents.
Competition in a specific region plays a major role. The lower the competition, the higher the шанс to become a leader in advertising, secure a strong position, and generate profitable orders from the very first conversion — leading to higher revenue per 100,000 residents.
Like in many industries, the food delivery market is undergoing globalization. Smaller companies are finding it increasingly difficult to achieve profitability from the first order, while market leaders can afford to operate at a loss in advertising, relying on LTV.
It’s important to work not only on advertising reach but also on product quality, delivery speed, and overall customer experience.
The higher the chance of impressing a new customer on their first order, the more likely they are to return — even if they were previously loyal to a well-known brand.
Which delivery businesses benefit from search advertising?
Paradoxically, the smaller the delivery business, the more noticeable the impact of search advertising.
You can acquire your first customers relatively quickly with a test budget, and within a few months — with proper investment — potentially become a market leader in advertising within your region.
In addition to classic acquisition channels, it’s also important to work with the existing customer base: email/SMS campaigns, banner ads, radio, etc.
