What separates them is the ridiculous amount of VC funding they took and have used on a combination of marketing and buying exclusives. Every actual experience I've had with DoorDash has been rather poor though, and they've gotten in trouble many times (they even got sued by In-N-Out a while back when they re-listed In-N-Out against their wishes using a knockoff logo to avoid trademark infringement). The only reason I ever use them is if I really want something that they have an exclusive on, and even that is rare (usually I'll eat somewhere else rather than order from DoorDash).
How are there network effects in delivery apps? It's a bipartite graph, and the number of restaurant companies is tiny compared to the number of users.
+1 for Seamless in the city, at least within my family/close friends. Might be because NYC has a strong fast delivery network within most restaurants and doesn't truly need a decentralized delivery network. The big draw to these apps to most of my friends has been the delivery of previously undeliverable food (Chipotle, McDonalds etc).
I use doordash 2-3 times a week. It's convenient and cheaper than Uber eats with dashpass. Just remember that if your too amount is less than 6$ it doesn't go to the drivers. It's better to too them with cash
You don't feel upset about how they were, in my opinion, defrauding you and the driver of the tip money? After I learned about what they were doing with tips I decided not to use them again, and considering how much competition there is I really haven't lost anything of value.
This isn't meant to be a triggering comment. I'm genuinely curious to learn about other people's reactions to DoorDash's former tipping system.
Personally: having learned of their scummy practices, I will not be supporting DoorDash or Instacart ever again, regardless of whether they change policy now in response to being exposed.
Why so unforgiving? Because you can't deter unethical behavior by merely asking for a perpetrator to discontinue the unethical behavior if/when exposed. The expected value of a penalty needs to exceed the financial reward of the behavior it is meant to punish. Furthermore, I don't trust companies who are likely to be unethical the moment someone isn't looking.
By their scummy practices, are you referring to their tipping policy?
I'm not sure I fully understand the backlash. Yes, the tipping policy didn't meet people's expectations ... but it seems almost exactly the same s how tipping + wages work for wait staff in restaurants (where restaurants are allowed to pay them less than minimum wage, as long as the difference is offset by tips).
Why are we okay with this policy, which is enshrined in law, for restaurant wait staff but not for delivery drivers?
A reasonable argument is that tips should always go direct to the staff and they should also at least make minimum wage, but that'd represent a huge change from the status quo and people aren't freaking out about how restaurant staff are compensated, so it seems like this hits a different emotional chord for some reason. Maybe it's more evil-seeming coming from a large tech-ish company rather than SMBs?
Firstly, restaurants are not allowed to pay "less than minimum wage" in any US state, though some states have two separate minimum wage rates for tipped and untipped employees. (NB: all west coast states in the US have just one minimum wage that applies for all employees, tipped or not.)
But more fundamentally Instacart and Doordash deceived consumers in a way restaurants don't. Say minimum wage for tipped employees is $4, a restaurant pays a $5 wage and I tip $2, I expect that the staff gets the $5 wage and the $2 tip (whether pooled or otherwise). If the restauranteur uses my $2 tip to cut wages below $5, then that would be illegal and outrageous. The minimum wage amount of $4 does not even enter into the calculation in this example, except defining the floor for the restaurant to pay its tipped employees.
> Firstly, restaurants are not allowed to pay "less than minimum wage" in any US state, though some states have two separate minimum wage rates for tipped and untipped employees.
This is a difference without distinction. It is the separate minimum wage for tipped employees which allows the restaurant to pay less than the minimum wage. If the tipped employee minimum wage is $A and the untipped employee minimum wage is $B, and the tipped employee earns $C in tips:
The restaurant must pay $A.
If $A + $C < $B, the restaurant must pay $B -($C + $A) more so the employee earns $B.
Else, the restaurant doesn't have to pay anymore.
That's exactly how DoorDash works. They pay $1 (equivalent to $A), guarantee another amount (equivalent to $B), and if $A + $C < $B, they fill in the difference.
> But more fundamentally Instacart and Doordash deceived consumers in a way restaurants don't.…
How so? They operate exactly as restaurants do in tipped employee minimum wages states in regard to tips.
> Why are we okay with this policy, which is enshrined in law, for restaurant wait staff but not for delivery drivers?
Personally, I am not okay with the law. An employer should pay a living wage. That said, I'm biased because I would vastly prefer to avoid the anxiety I feel around figuring out the right amount to tip such that I don't feel scummy nor taken advantage of. I went there to eat some food, not feel anxious.
I just did the same with Amazon since they have the same tip practices as DoorDash. That and reading about the Ring Alarm system being sold by law enforcement it just put me over the edge.
Can I avoid AWS? No, but I can certainly not spend my own money directly on any of their services.
I drove for DoorDash and I absolutely prefer the guaranteed amount with them keeping the tips.
First of all, people tip beforehand so it's not based on quality of service anyway.
Second of all, it makes DoorDash a steady stream of income instead of hoping that you'll be tipped enough. Most people don't tip and if the tip is large enough, you do receive the tip.
I think this wasn't really a bad deal for the drivers, but it was essentially a lie to the consumers: they think tipping will make a difference for the driver, but instead it only makes a difference to DoorDash. What's really needed is a minimum wage that applies to everyone, regardless of employee status.
I just give $0 tips through the DoorDash website (and you have to select $0 TWICE, at both the top and bottom of the checkout page, by the way) and give them tips in cash.
That way DoorDash provides at least a partial matching contribution to my tip instead of eating from my tip.
I don’t have a problem with it although I think it’s good that they changed it. If drivers complain “we’re not getting enough tip” and the company says “OK we guarantee your tips will be at least $5 on this order” that’s the behavior you get. The customer feels ripped off by a program that ostensibly benefited drivers to begin with.
They weren't "defrauding the drivers of tip money" they were normalizing the variance in payments across deliveries by not directly paying the drivers tips and instead guaranteeing a minimum payment amount which was above the delivery fee.
Once they modify their system and move to a system where drivers get 100% of the tips the drivers will probably see approximately the same payouts on average, just with higher variance across drivers. Basically what DoorDash was doing is the same as tip-pooling at a restaurant which isn't exactly a controversial practice.
Why do you expect bad delivery drivers to have poorer tips? I've never adjusted a tip based on the quality of the driver, because I can't measure that. Anyone can hand over a bag of food, so the only thing I see is how long they took. But whether they arrive quickly or slowly is probably the kitchen's fault, or luck of overlapping orders. Realistically, I have nothing to rate them on.
This isn't like restaurant tipping where bad service gets 10% and good service gets 25%+ It's mostly bi-modal, drivers frequently don't get tipped at all. In this scenario reducing variance makes sense because (as many other commenters here note) unless the experience is overwhelmingly bad the tip generally has more to do with the receiver of the order rather than the driver.
The entire point of the tipping system is to have a high variance. The promise, but not guarantee, of tips is what is supposed to incentivize better service.
But in the case of the DoorDash, if you tip using the app, you tip long before you know what the service will be.
It's like walking blindfolded into a restaurant and putting your tip in the hostesses hand before you even see any of the staff, or have any indication of service.
That's true, although to be fair, there's only so much a delivery driver can do service-wise compared to a waiter. Your only interaction with the driver is picking up the order. The driver isn't responsible for the time the restaurant takes to get the food to them, and isn't even entirely responsible for the time it takes to get the food from the restaurant to you -- there's traffic, weather, and the possibility that DoorDash demands they batch orders (something I've heard but haven't confirmed). I'm not sure it's fair to hold a third-party delivery driver responsible for the correctness of the order, either, rather than the restaurant.
They just announced they plan on changing the policy. It has not changed yet.
Also they announced they were "investigating the issue" for 4 months before, and then didn't make a change. So let's not congratulate them until its been confirmed to be actually working as drivers and customers expect.
While this was definitely not clear to the consumer, it ended up being a preferable model for the drivers as they would get a higher pay on most orders. Not saying that it should be that way, but saying they did that just to steal tips is not true. It was used to guarantee a minimum amount on orders that don't make sense financially.
What the company should have done, ethically, is to just increase base compensation for drivers. You shouldn't be able to dynamically change base compensation based on the quality of the tip that the driver is rewarded, that is pretty antithetical to the entire idea of a tipping economy.
That's a very valid viewpoint and what's done by Grubhub or Caviar I believe. But it results in lower pay for the drivers overall because the guaranteed minimum is lower than the one DoorDash usually offers.
Honestly, more than anything it's just user preference.
There are some restaurants that are exclusive on certain platforms (UberEats for example is exclusive with McDonalds), so if you want that, there's only one game in town, but most people I know who use these platforms regularly (myself included) aren't using them for a specific restaurant. It's more like, "I want sushi! I wonder what is available on my platform of choice?"
Beyond they all have slightly different pricing models, but at the end of the day they all cost about the same.
When Grubhub acquired Eat24 from Yelp and removed the group order feature in favor of signing up for a "corporate" account, it sent much of my business to DoorDash.
I dunno, compared to drivers dedicated to a specific business, I've yet to have an experience with UberEats/Postmates/Grubhub/DoorDash that wasn't leaving me with food that was cold, either because they did not use insulated bags, or they simply took way too long to get to me. When a joint is 15 minutes away, it'd take the driver a literal 60 minutes to drive from the restaurant to me. Your mileage may vary, depending on your region, but it's just a waste of money and time if you ask me.
I’m not an expert but I know that DoorDash partners with large established chains, they power Chipotle and Wendy’s delivery services. GrubHub is getting in in this too: they power Taco Bell’s new delivery service. I bet these deals lead to a more simpatico relationship monetarily. I bet it also avoids stuff like what is said in this comment https://news.ycombinator.com/item?id=20588348
My experience is that it's somewhat regional, but it doesn't feel sudden at all to me. I've used DoorDash for years, and it's because in my area they have much more selection of restaurants, and often faster delivery (which I assume means more drivers). Uber Eats doesn't even deliver to my house even though Uber covers my area.
Personally, Foodler had some nice features I like and Grubhub bought and killed them so I'm not going to be using Grubhub. Can't say I have a strong opinion among the others.