Today, DoorDash is considered the most successful food delivery company. With so much competition, how did DoorDash achieve this title, especially against Grubhub?
Let’s take a look into the key factors that led to DoorDash’s supremacy over Grubhub.
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How Did DoorDash Win Against Grubhub?
DoorDash has emerged as the industry leader in providing the essential qualities and most desired services to all stakeholders in the on-demand delivery sector. DoorDash not only excels in logistics and last-mile delivery, but also exceeds expectations by providing unique, yet needed and desired services not provided by competitors.
Clear Vision and Mission
From the very beginning, DoorDash established a very clear mission and vision. Their original mission was to create a “local, on-demand FedEx.”
They both clearly understand and communicated that first and foremost, they are a logistics company. DoorDash also understood that they succeed by helping their partners succeed, stating, “We help small businesses grow, we give underemployed people meaningful work, and we offer affordable convenience to consumers.”
Timing has certainly worked out in favor of DoorDash, but also because they have been optimally prepared for opportunity at every turn, more so than their competitors such as Grubhub.
DoorDash did start out at around the same time as other on-demand, gig-economy delivery services.
DoorDash benefitted by started out soon enough that the entire market was not yet saturated. There were some major gaps in the other companies’, such as Grubhub’s, business that DoorDash was able to use to not only get a foot in the door of the industry, but to really capitalize on and use to grow immensely.
Because of DoorDash’s incredibly strong and steady growth, DoorDash became big enough to snowball their success into greater successes, and were always ready to adapt to changes. They have partnered strategically with large companies such as Chase, Albertsons, and CVS to gain huge amounts of new customers.
Also, while many other companies were criticized and/or suffered for their responses (or lack of) at the onset and continuation of the COVID-19 pandemic, DoorDash was incredibly quick, proactive, positive, and helpful in their response, far excelling Grubhub and other competitors.
By only March of 2020 DoorDash’s CEO, Tony Xu, shared that DoorDash had already acquired “tens of thousands of gloves and bottles of hand sanitizer.” At a time when other major companies were criticized for not providing sufficient safety measures for their employees, DoorDash shared these gloves and sanitizer with their delivery drivers for free.
They also quickly implemented contactless delivery to assure customers’ and drivers’ safety.
Providing a Helping Hand During COVID-19 Pandemic
DoorDash went even more above and beyond Grubhub and other competitors by providing their independent contractor drivers up to two weeks of pay if they were sick or required to quarantine due to COVID-19.
They also waived commission fees for 30 days for new partner restaurants for two-and-a-half of the worst financial months of the pandemic (March 17 through the end of May, 2020), and also waived and/or reduced fees and commissions for existing restaurant partners during this time.
DoorDash created other philanthropic and community support initiatives during this time, as well, such as expanding Project DASH which provided delivery support for government and non-profit organizations to facilitate deliveries to food pantries, schools, and senior centers.
Another program created during that time was DoorDash’s Main Street Strong Initiative, which supported communities with a Restaurant Advisory Council and Entrepreneurship and Access Programs,
Such supportive and empathetic leadership both expanded and solidified the public’s positive recognition of DoorDash.
DoorDash utilized several successful marketing tactics. The first tactic went along with their operational tactics, which was to focus on gaps in service left by their competitors’, such as Grubhub. Mostly, this had to do with DoorDash focusing on suburban areas and smaller cities rather than larger urban areas already being serviced by their Grubhub and others.
Secondly, DoorDash was successful in segmenting their different “audiences,” which in their case has mainly been restaurants, customers, and their delivery drivers. They understood the pain points and challenges of each segment and addressed these in a way directly targeted to that group.
For the restaurants, they targeted restaurants that could not easily afford or manage their own delivery fleet, or who did not have enough space to seat very many customers at one time. For their customers, they targeted people who value convenience and saving time, and who have the extra money to pay for it.
DoorDash also understood how to appeal to potential drivers who were interested in making more money in a steady yet flexible way.
DoorDash also went above and beyond their competition, with truly unique and valuable data sharing, as described further in the next section of this article.
Sharing Data to Provide Unique Added Value
A major way that DoorDash stands out from Grubhub and other competitors is that – in addition to successfully fulfilling the need to facilitate deliveries – DoorDash not only collects valuable data for their own use and improvement, but they share relevant data with their restaurant partners.
This data would likely be prohibitively time consuming and expensive for most small or even medium-sized restaurants to collect on their own, yet it is incredibly useful and powerful.
The customer insights data, called Drive, are made available by DoorDash via their app. The data insights about a restaurant’s customers include which products are in the highest demand, average delivery times, and helpful information about the neighborhood around the restaurant.
The same app also allows restaurant partners to customize their delivery options, have an integrated point-of-sale, and of course, utilize DoorDash’s on-demand delivery drivers to reach more customers.
DoorDash very importantly understood that although their technology and logistics need to be cutting edge, the customer- and client-facing portions of their app must be simple and intuitive.
Being easy to use is essential in providing a positive experience to as many people and restaurants as possible, and to keep them coming back as often as possible.
Though DoorDash is constantly improving everything about its company possible, they remain disciplined in not making the customer- and client-facing aspects complicated, confusing, or even busy-looking.
How DoorDash Beat Grubhub
DoorDash has become the clear industry leader for offering the most desired and essential services to all partners within the on-demand delivery sector. The company provides unique, yet coveted and necessary services that are not served by competitors, as well as, of course, excelling in last-mile delivery and logistics.