Dive Brief:
- DoorDash is launching a “Main Street Strong” initiative, which will include new products and programs aimed at helping restaurants build their own online branding, according to a press release. DoorDash Storefront will enable restaurants to create their own turnkey online stores. This product will be widely available in July and DoorDash will waive setup, software and merchant delivery fees for local restaurants in 2020.
- The third-party aggregator will also expand its DoorDash Weblinks program, a service where DoorDash manages a restaurant partners’ digital ordering experience by directing them to DoorDash. The company is offering 0% commission to restaurants with five or fewer locations on all weblink orders for delivery and pickup through the end of the year.
- In June, the company will launch Local Restaurant Saturday, which offers customers $0 delivery fees every Saturday for local restaurants. DashPass subscribers will also receive 10% off pickup orders during June.
Dive Insight:
Having an online presence has been increasingly important throughout the coronavirus outbreak, especially when a bulk of municipalities banned dine-in service and people stayed at home. DoorDash estimates that 40% of its restaurant partners don’t have their own e-commerce platform.
While many restaurants say that takeout and delivery have not been enough to maintain operations because of increased costs, others, like the independent restaurant Araujos Taqueria El Paisa in San Jose, California, reported an increase in sales of 180% in the five weeks after March 17 on DoorDash. To help restaurants reduce delivery costs, many municipalities, including Seattle, Chicago, San Francisco and New York City, have temporarily capped delivery fees.
“We’ve learned from conversations with restaurant partners that they are looking to develop multiple ways to engage with customers: to continue offering the dine-in experience and drive consumers back in store, to build their own digital ordering solutions to meet consumers’ needs as they move online, and to reach new customers and receive additional orders through marketplaces like ours,” Kevin Huang, head of merchant strategy and operations at DoorDash, told Restaurant Dive.
DoorDash has been offering a package of commission and marketing relief that helped restaurants save $120 million, Huang said. From April 13 through the end of May, it cut commissions in half for restaurant partners with five or fewer locations on its platform and Caviar. It also provided $20 million in merchant marketing programs and $0 commission fees for pickup orders. Offering free delivery for customers in April also helped drive 1 million in incremental orders, Huang said.
“Now, we are switching from a focus on relief to helping restaurants grow and navigate the recovery phase of the COVID-19 pandemic,” he said.
Part of that strategy already included updating its pickup service to allow restaurants to track customers who opt in to share their locations. This feature will inform restaurants when a customer is arriving to pick up their order, with a goal of reducing customer wait times. Other third-party aggregators are offering similar tools as well. Postmates rolled out a curbside pickup feature while Grubhub launched a comprehensive pickup service in January.
“We believe that off-premise will absolutely remain an important channel for restaurants even as restaurants begin to open their doors back to dine-in customers,” Huang said. “We’ve seen customers excited to interact with their favorite local restaurants online and believe that some of those consumer habits will remain the same even when all resumes back to normal.”
DoorDash will continue to build out its Main Street Strong initiative and the company will make more announcements in the coming months, Huang said.
