DoorDash Overtakes GrubHub As Top Delivery Service

DoorDash Overtakes GrubHub As #1 Delivery Service

DoorDash has overtaken GrubHub as the No. 1 food delivery service in the U.S., according to a report by CNBC.

The data comes from analytics firm Second Measure. DoorDash got 33 percent of all food delivery sales in the U.S. in 2019. GrubHub, which used to be No. 1, captured 32 percent of the market. Uber Eats captured 20 percent, and Postmates got 10 percent.

DoorDash sales grew 143 percent year over year, which changed the delivery landscape significantly from 2018, when GrubHub held onto 43 percent of the market.

The digital food industry continues to grow, and it’s estimated that it will become a $467 billion business in five years, which is an increase of 31 percent over current numbers.

However, the digital food delivery industry also has to deal with very thin margins and sometimes murky paths to profitability.

Digital delivery sales have gone up overall, but average checks have not. In fact, the average check has fallen from over 4 percent in 2015 to no growth last year.

Aggregators are also now starting to appear in the marketplace, with companies like FoodBoss comparing the prices of different services.

It’s difficult for restaurants to find a balance between teaming up with aggregators, who can help an eatery with its reach, marketing and distribution, with the economic realities of paying a large fee to them, according to Karen Webster, CEO of PYMNTS.

“Restaurants are trying hard not to follow in the footsteps of their retail brethren a decade or so ago, when they ignored the impact of digital, mobile and voice — and the proliferation of connected devices — on their businesses,” Webster said. “Many recognize that, although small in terms of percentage of sales, the digital and delivery channel is growing more rapidly than visits to physical establishments. And in an effort to not miss out on those trends, they are following the classic digital commerce playbook: Be where the consumers are.”