Food delivery or Forced delivery? A case study on restaurants' business model innovation in response to digital platforms

Abstract: Digital platforms have prospered since the beginning of the pandemic and radically change how firms create and capture value. The restaurant industry has been particularly exploited, invoking strains on incumbent restaurants' business models and leaving managers in unfamiliar territory. The circumstances form a unique opportunity to research a phenomenon when actors are pensive about the development. This study outlines the impact digital food delivery platforms have on incumbent restaurants and how they innovate their business model in response. We used a qualitative case study design of explorative nature, in which semi-structured interviews with qualified and experienced executives comprised the primary source of empirical data. The result shows that incumbent restaurants experience a loss of control, relationship tension, and depleted profitability. In conjunction, these factors outline new requirements in premises, new ways to improve the customer experience, and new ways to drive sales. The paper concludes that incumbent restau- rants' management needs enhanced business acumen to successfully manage and allocate resources between the two modes of operations - delivery and on-site consumption - which entail fundamentally different business models. Thus, we contribute to executive management by outlining key considerations to help navigate the changing industry climate. In addition, we extend the business model elements framework proposed by Mason and Spring (2011) to account for the overlooked component customer data.