Delivery fees are the breaking point in Americans’ otherwise booming convenience habit, according to a new survey from FinanceBuzz conducted in partnership with Bank of America, which found 68 percent of consumers have abandoned a delivery order after seeing the total cost with fees – a figure that climbs to 78 percent among Gen Z.
The findings carry direct implications for grocers weighing delivery economics against pickup investment: the average American will pay $9.49 in food delivery fees before deciding to pick up an order instead, and the most common answer was just $5, suggesting fee-sensitive shoppers convert to pickup at thresholds many delivery programs already exceed.
The survey of 2,000 U.S. adults, conducted in August, found near-universal adoption of convenience services, with 97 percent of Americans using at least one, including food delivery, takeout, grocery delivery or errand services, in the past month, and 52 percent saying their convenience spending has increased compared with five years ago.
“Some people are paying for the value of the delivery, but many are paying not to think about it at all,” said Melinda Sineriz, managing editor at FinanceBuzz. “This isn’t just frivolous spending; Americans value their time, and they’re willing to buy some of it back.”
Key findings
- Americans value an hour of free time at $87 on average, more than double the $37.62 average hourly wage reported by the Bureau of Labor Statistics.
- Some 85 percent pay for at least one convenience membership, averaging $22 a month, or $264 a year, even as they balk at per-order fees approaching $10.
- Gen Z reported an average of 4.3 food delivery orders per month, nearly three times the 1.5 reported by baby boomers, and was also the generation most likely to feel guilty or embarrassed about convenience spending.
- Fee fatigue is reshaping tipping: 22 percent have tipped nothing on a delivery because the meal was already expensive or the fees were already high.
- Abandonment over fees falls to 41 percent among baby boomers – the generation least deterred by total cost at checkout.
The consumer-side friction mirrors what operators report from the other end of the transaction: managing third-party delivery ranked as the second-hardest part of running a small-format food retail business in Toast’s recent operator survey, up 5 points year over year.
FinanceBuzz, a personal finance website founded in 2016, conducted the survey via the online research platform Prolific, with dollar-figure averages excluding statistical outliers.
Related: Toast Survey: Independent Grocers Confident, Efficiency-Focused