Doordash vs UberEats vs Grubhub (2024)

Let us now understand why third-party food delivery services are important for restaurants and the multifarious benefits they offer.

Improves Customer Service – Consumers of today prefer at-home food delivery. With a surge in demand, the presence of third-party food delivery apps comes as a great relief to restaurant owners. They not just offer delivery service but provide the amenities that customers love. This enables restaurateurs to effortlessly impress a wide range of customers

1. Reduces Business Costs – Restaurant owners usually get worried about the upfront fees that they need to pay the third-party food delivery apps. But they help restaurateurs save expenses in the long run. Restaurant owners who utilize the services of these food delivery apps need not worry about the cost of fuel for transportation, vehicle insurance and the availability of drivers to make the transport possible. Third party food delivery apps are a practical solution and a boon for small-scale restaurants.
2. Increase Customer Base – This is the most important benefit that restaurants are likely to enjoy by using third party food delivery apps. Since it is also a form of advertising, the business gets publicity, and you gain new customers from your neighborhood.
3. Greater Profits – With more new customers walking in and the size of your savings increasing significantly, your profits are sure to rise. Several studies have indicated that third-party food delivery services can increase restaurant sales by an average of 30%.
4. Labor Optimization – With third-party delivery partner services, a restaurateur can streamline the workflow and optimize every element involved in restaurant operations. As stated earlier, the restaurant owner need not hire a fleet of delivery drivers. Since orders are processed digitally, the staff get ample time to attend to other important aspects of customer service. In case of any complaint or mistake, the third-party food delivery app also plays the role of your savior.
5. Build Brand Awareness – A third party food delivery service not only helps grow your customer base, but also aids you in building brand awareness. Since these delivery apps are looked upon as an unofficial seal of approval by almost all consumers, this helps in winning their trust and achieving brand awareness.

Let us now move on to learn about DoorDash, Uber Eats and Grubhub separately.

What Is DoorDash?

DoorDash has gained extreme popularity as a food delivery service and app. The organization was founded in 2013 in San Francisco by four students. They wished to address the challenges faced by small restaurateurs and fulfill the increasing demand for food deliveries. By 2019, DoorDash touched its peak and became the largest food delivery service.

DoorDash bridged the gap between demand (from the local consumers) and supply (by food outlets) by making delivery possible though self-employed or independent drivers.

Statistics About DoorDash

1. It has over 450,000 merchants and 20,000,000 customers
2. It is available in 50 states, Washington D.C., Canada and a few countries like Australia, New Zealand, Japan and Germany
3. DoorDash enjoys a 56% market share in the food delivery category
4. It has a 60% market share in the convenience delivery category

Working Model Of DoorDash

It takes just a computer or a mobile app to use DoorDash. Customers place orders from local restaurants, convenience stores or grocery stores. DoorDash has a fleet of drivers who work as its independent contractors. They simply pick up the order and deliver it to the doorstep of the customer.

DoorDash For Customers

The user needs to register their name along with the address and provide their payment information. This will help users maintain records of previous orders, save favorite restaurants and stores for quick access during future transactions. Customers can also make specific delivery instructions like specifying where the package must be delivered or share a secret code to gain entry access to the apartment, etc.

DoorDash For Drivers

Individuals who apply to work for DoorDash are onboarded as independent contractors. They make use of their own cars and a separate app to acknowledge orders and fulfill deliveries. Drivers can choose flexible timings. Only when they set themselves as available for work will they start getting delivery orders. So, drivers will not be interrupted if they do not wish to. They will not be pinged during odd hours. However, drivers can make most money when they complete deliveries during peak hours like lunch or dinner time. The base pay of drivers ranges between $2 and $10. The entire tips amount made from each delivery is paid to the Doordash driver.

Features Of Doordash

The following are the 5 features of Doordash that help it stay unique. These prominent features are also being copied by other apps trying to carve a niche for themselves in the industry.

1. Suggested List – This feature of Doordash involves the use of Artificial Intelligence to provide a suggested list to the customers based on their personal choices.
2. Top Menu – A top menu option is available in the app to make the entire food ordering process extremely customer centric. This menu shows details of the customer’s previous orders including the top food items ordered by them from a particular restaurant.
3. Dual Rating – Users of Doordash can give their ratings twice – one for the food and delivery quality and the other for the delivery partner.
4. Live Tracking – Doordash gives users the option to keep a live track of the status of their food delivery – where exactly the delivery partner is – on a real-time basis. Users receive constant updates of where the food has reached on their device.
5. Schedule Delivery – Doordash provides great ease of use and offers an option for users to schedule orders even one week in advance. This saves your time allowing you to enjoy your family time during festivals.

Ways DoorDash Earns Revenue

• Commission – DoorDash is a huge platform that serves customers by delivering food from the chosen restaurants to their doorstep. Every time a user chooses a particular restaurant, DoorDash earns a 20% commission from the business, that too on every order
• Advertisem*nt – For restaurants to be ranked in the top slots in the DoorDash app, they must engage in paid advertising. The visibility of restaurants is thus increased by the app helping them gain more customers
• Delivery Fee – DoorDash earns revenue through delivery fees – an amount that is determined at the time the customer makes the payment. This depends on the distance between the pickup and delivery points. This fee ranges between $5 and $8
• DashPass Subscription – Subscription is a process where customers pay a monthly fee of $9.99 to enjoy reduced service fees on all orders above $12. This is a significant revenue stream for DoorDash that helps in gaining repeated customers and increasing customer loyalty
• Corporate Catering – DoorDash also engages in corporate catering services. Businesses can place group orders for food to be served to several employees. DoorDash keeps the prices for corporate catering lower than the prices of individual orders, thus attracting several bulk orders
• Channels – Most of the networking of DoorDash and its pickup operations are done via its website – www.doordash.com. The website is also a digital way to order food and track transit in real-time.

Success Formula Of Doordash

The success of DoorDash can be contributed mainly to its focus on customer satisfaction and convenience. The constant innovation of DoorDash helps it expand its services, thus attracting new customers and turning existing ones into regular users.

It takes extreme care in keeping its customers happy and ensures that they keep coming back for more. The ease of use and convenience offered by DoorDash app makes it a customer’s most favorite choice. It facilitates customers to order their favorite food from their favorite restaurant and get it delivered to the location of their choice.

Statistics About Grubhub

1. Grubhub processes more than 745,000 orders every day from about 325,000 restaurant partners
2. Grubhub has about 33 million active customers
3. It operates in 4,000 cities
4. In 2023, Grubhub generated a revenue of $2.1 billion
5. In 2021, Grubhub had 41,000 drivers on its platform
6. Grubhub enjoys a market share of about 22% in the U.S. food delivery market

Working Model Of Grubhub

The Grubhub business model is customer centric. Customers lie at and form the core of this business model. They access Grubhub using an iOS or Android mobile app. The Grubhub website can also be used to place orders and make payments.

Grubhub For Customers

Customers can begin using the app or website after creating an account and entering payment information. They simply surf down a list of restaurants or search for specific restaurants situated near them and place food orders by selecting items of their choice, adding it to the cart and making payment. If a default payment method is not set already, they must choose a payment method. Customers can keep track of the food order in real-time until the moment it is delivered. Apart from the restaurant charges, Grubhub also needs to be paid a delivery fee.

Grubhub For Restaurants

Grubhub works with a network of restaurants. It helps them extend their reach by promoting food delivery even if the restaurant conventionally offered only dine-in services.

Restaurants can use the delivery service of Grubhub instead of recruiting and managing one’s own delivery people. Restaurants need to apply through the ‘Grubhub For Restaurants’ option available on the Grubhub website. After approval, Grubhub works with restaurants in uploading their menu, pricing and other details in the app and website.

Upon receiving an order from the customer, the restaurateur gets notified on the dashboard of the restaurant’s Grubhub app. The order is confirmed by the restaurant after which food preparation begins. A delivery partner reaches the restaurant and picks up the prepared food. Once it is delivered to the customer in his preferred location, the process is completed.

To facilitate this workflow, the restaurant pays a portion of its revenue to Grubhub. This consists of the marketing fee charged by Grubhub, processing fee and a predetermined percentage of the cost of the order. To accommodate such expenses, the cost of food for delivery is higher than that of dine-in.

Grubhub For Drivers

Working for Grubhub as a driver and delivery partner is like being a part of the ‘gig economy’. The position is temporary and is filled by independent contractors and freelancers who work part-time, keeping this as a supplement for another job. This helps drivers gain flexibility and independence. There are also people who choose to be a Grubhub driver and rely on the revenue as a major source of their income.

Drivers can use the Grubhub for Drivers page of the Grubhub website to apply for the position. The individual needs to have a car (bike is acceptable in some locales), a valid driver’s license, auto insurance (or state ID for a bike) and, of course, a smartphone with the app installed.

Features Of Grubhub

1. Intuitive Food Search & Filters – Grubhub provides a user-friendly search interface that enhances user experience. Users can explore a variety of cuisines effortlessly and filter search results based on their specific preferences
2. Real-Time Order Tracking – This feature of Grubhub provides users with real–time updates on their order status, delivery time and the precise current location of the delivery person. This fosters transparency and enhances customer experience as the customers are kept informed and engaged
3. Secure Payment Integration – Grubhub lays great emphasis on user convenience and security as it has a reliable, integrated secure payment gateway. This facilitates seamless and secure online transactions that build the trust of users. The checkout process becomes hassle-free for both customers and restaurants
4. Customizable User Profiles – Users can save favorite restaurants, set their default payment mode and delivery address. Personalization helps improve user engagement
5. Returning customers find it quick and simple to use the app. This not only fosters loyalty but also encourages them to visit their favorite restaurants
6. Restaurant Ratings & Reviews – When customers are allowed to rate and leave reviews for both restaurants and delivery services, it helps others take informed decisions. Authentic feedback increases transparency, helps improve the quality of service and brings to light new dining options resulting in a reliable restaurant ecosystem
7. Promotions & Loyalty Programs – This feature provides incentives to repeat visitors making them choose Grubhub over the competitors. Customers are made to feel valued through discount codes, cashback offers or loyalty points. Incorporating promotions, discounts and loyalty programs boosts customer retention and satisfaction.

Ways Grubhub Earns Revenue

Following are the revenue streams for Grubhub

• Commission Fees – Restaurants must pay Grubhub a commission fee on each order that they receive via the app. The fee ranges from 10 to 30% of the total value of the order. This is an important source of revenue which is spent on fulfilling the platform’s operating costs, website maintenance, payment processing and marketing activities. Restaurants are also entitled to pay a per-order fee to Grubhub for the latter to bear the cost of processing and delivering the order. This ranges between $1 and $3.50 and is subject to changes based on the size of the order and distance of the restaurant
• Delivery Fees – Customers need to pay Grubhub a nominal delivery fee for every order placed through the platform. This revenue is used by Grubhub to cover delivery expenses that include driver payment, maintaining the delivery workflow, etc. This fee varies based on the size of the order, the distance that needs to be covered and demand at that time of the day
• Advertising Fees – Restaurants can advertise through Grubhub for which they need to pay the platform. This helps the business reach more customers and increases visibility in search results. Grubhub offers restaurants services like sponsored listings, display ads and other promotional features that help restaurants expand their reach. This paid service is another revenue stream for Grubhub
• Subscription Fees – The subscription service of Grubhub is called Grubhub Plus. It provides restaurants with additional features and benefits that increase the visibility of the restaurant, lowers commission fees and offers insights using advanced analytical tools. This is yet another paid service that helps Grubhub generate revenue
• Miscellaneous Revenue Sources – Grubhub also offers a mobile payment service, sells Grubhub Gift Cards and engages in several promotional activities. While these streams play a minor role in revenue generation, they remain inevitable in the Grubhub business model

Success Formula Of Grubhub

• Concentrates On Online Ordering – Grubhub captured the market by focusing greatly on online ordering and delivery before others could make optimal use of the trend. This helped Grubhub carve a niche for itself and gain a sturdy foothold in the market
• Vast Restaurant Network – Grubhub has partnered with a wide variety of restaurants and caters to a broad range of user preferences. This is another reason for its success
• Wise Acquisitions – Grubhub made a strategic acquisition of rival Seamless. This paved the way for Grubhub to solidify its market position

Uber Eats acts as a liaison between restaurants and customers, picking food orders (placed online) from local and chain restaurants and dropping them at the doorstep of the customer.

Food orders can be placed either using the Uber Eats website or Uber Eats app. The app is available for both iOS and Android users. Irrespective of the medium used to place orders, the process of ordering food online is almost the same. Simply select the restaurant, choose the items of your choice, check out by making an online payment or opting for cash on delivery.

Statistics About Uber Eats

1. Uber Eats (originally UberFRESH) is a spinoff launched by ride hailing service in 2014. Operations of Uber Eats expanded beyond the United States only in 2016.
2. In 2023, Uber Eats generated $12.1 billion in revenue, marking an 11% increase year-on-year.The platform’s gross bookings exceeded $67.8 billion in the same year.
3. Internationally, Uber Eats stands as the most popular food delivery service, boasting 88 million users.With over 800,000 restaurants available in 11,000 cities, it continues to lead the market.

Working Model Of Uber Eats

Uber Eats business model is a multisided platform that acts as a liaison for restaurants and food outlets to connect with customers for facilitating food delivery at the doorstep of the customer. This platform offers convenience for both parties involved – enabling restaurant owners to sell their food online and customers to place orders effortlessly and receive the food right at their doorstep.

Both iOS and Android users can use Uber Eats to browse the menus of restaurants and food outlets and place orders. Therefore, customers need not wait in long lines to get hold of their food. They can enjoy their favorite dishes without leaving the comfort of their home.

Uber Eats For Customers

End customers who place food orders create an account on the app. Once this is done, they gain access to the menu of all local restaurants registered on Uber Eats. They can choose the restaurant of their choice, add items to the cart and checkout by making an online payment or opting for Cash On Delivery (COD). The status of the food order can be tracked in real-time using the app and end users are also informed about the estimated delivery time.

Uber Eats For Restaurants

Restaurants partnering with Uber Eats reach out to a wider audience base due to their virtual presence and operation. They bring their menu online with high-quality images and throw great offers that customers find irresistible. Restaurateurs need not spend money on creating expensive mobile apps and share the same online space as their competitors to reach a greater spectrum of food lovers.

Uber Eats For Drivers

The delivery guys in the driver fleet of Uber Eats are independent people who work on a freelance basis. Their responsibility starts with the picking up of the food order from the restaurant and ends with the delivery of the food to the end user or customer. They are notified about the order through the app and receive their payment every time they complete an order by delivering it.

Features Of Uber Eats

1. Smart Recommendations – Everyone knows that AI is driving mobile app personalization. Uber Eats is at the forefront of this innovation. With the Uber Eats app, foodies can view photos of a meal before placing an order. Additionally, its suggestion carousels recommend several nearby restaurants based on your location. Leveraging machine learning, Uber Eats tailors taste preferences by suggesting cuisines according to past orders and current contextual information. This ensures users receive personalized food choices from various restaurants at the touch of a button
2. Advance Ordering – Pressed for time but need your food promptly? Choose Uber Eats. It allows you to pre-book orders up to an hour or even a week in advance. Moreover, you can track your order throughout the delivery process to ensure it arrives at your desired location
3. Analytics for Restaurants – When a restaurant receives bulk online orders, this feature stands out. Uber Eats has introduced a new analytics tool called Restaurant Manager, which aids in making data-driven decisions. With this tool, Uber Eats partners can access data and insights to refine their food quality, delivery strategy, and optimize user satisfaction
4. Order with Confidence – When ordering food, users often worry about delivery eligibility for their location, especially for places like hospitals and parks. Uber Eats addresses this concern by delivering to locations such as hospitals, parks, homes, offices, and more. Additionally, the user can include preferred delivery instructions
5. Detailed Dish Information – Uber Eats app excels in easy exploration. Its infrastructure is designed to be user-friendly. For instance, if a user searches for gluten-free options, the app provides relevant results. Users also receive comprehensive information about a dish, including ingredients and average preparation time
6. Customizable Notifications – A crucial feature of Uber Eats is push notification. Through push notifications, you can send alerts to users regarding orders, deliveries, offers, and discount codes. It is beneficial to ask customers how they prefer to receive notifications, whether via SMS, email, or push notifications

Ways Uber Eats Earns Revenue

As mentioned earlier, the business model of Uber Eats involves three sides – restaurants, delivery agents and end customers. It combines the models of a multisided platform, aggregator and an on-demand online business.

Following are the four revenue streams for Uber Eats:

• Commission On Orders – This is the major revenue stream of Uber Eats as it charges a 30% commission from the total cost of every order from the restaurant
• Delivery Fees – The fee paid to the delivery partner consists of three parts – pickup fee, delivery fee and distance per mile fee. The sum of each part will vary depending on the location, distance and availability of drivers. Uber Eats usually charges 25% of the total sum and for orders below $12, it charges a ‘small order fee’ which is about $2
• Promotions – A few renowned restaurants and food chains sign special agreements with Uber Eats to run promotions and offer app-exclusive discounts to achieve more sales. These food outlets pay Uber Eats special commissions or fees accordingly to complete the deal
• Surge Pricing – Just like Uber, the ride hailing service and parent company of Uber Eats, the latter also charges dynamic prices. This ‘busy fee’ is charged during surge hours or periods of high demand. This is calculated based on the number of orders placed from the same area and the availability of delivery partners

Success Formula Of Uber Eats

• Capitalizing on existing Uber network – Uber Eats leveraged and capitalized on the existing driver network of Uber. This ensured it had a full-fledged, functional delivery force during launch
• Uber App Integration – The seamless integration of Uber Eats app with the existing Uber app led to customers instantly embracing Uber Eats as well, as the platform was familiar and convenient for them
• Global Expansion – With aggressive expansion, Uber Eats set foot in international markets as well. This helped Uber Eats expand its customer base

This blog would have helped you understand the business models of three prominent food delivery apps – Doordash, Grubhub and Uber Eats. For more help with restaurant website building and digital marketing techniques, get in touch.