DoorDash Sweetens White-Label Offerings with New Cash Payments Option

To drive restaurant adoption of its white-label offerings, DoorDash is adding cash on delivery options.

The nation’s leading aggregator announced Tuesday (March 21) the launch of a Cash on Delivery option for restaurants using its DoorDash Drive white-label fulfillment tools, enabling eateries to accept cash payments on delivery for digital orders the way consumers may have paid in the past for, say, call-in orders.

The aggregator noted that the feature is proving most popular with customers at pizzerias, with consumers selecting the payment method for nearly one in five transactions at pizzerias where the Cash on Delivery option is presented.

“There are countless factors from checkout to delivery that contribute to a seamless at-home pizza experience,” Ben Smith, director of operations development at Donatos Pizza, said in a statement. “Cash On Delivery through DoorDash Drive is one way we’ve maintained this high-quality service our loyal customers expect, as we can grow our business online, while still enabling customers to pay with cash should they desire.”

The news comes at a time when aggregators are increasingly challenged to step up their white-label capabilities for restaurants, given the far greater popularity of direct ordering channels compared to third-party.

Research from PYMNTS’ study, “The 2022 Restaurant Digital Divide: Restaurant Apps And Websites In The Spotlight,” which draws from a census-balanced survey of nearly 2,000 U.S. consumers, finds that 16% of consumers primarily order food via restaurants’ direct ordering channels such as their website or their app. Meanwhile, only half of that share (8%) said they mainly order food via a third-party aggregator.

As such, aggregators are looking to gain restaurants’ direct ordering loyalty by sweetening the deal with their white-label offerings. Last month, for instance, Grubhub added several features to its Direct white-label platform, including, for example, the ability for restaurants to display their websites built with Direct on their Google Search Business Profiles and to list those sites as the preferred online ordering option on Google platforms.

“What we’ve seen too is that diners are going to make their choice based on where they’re going to want to order, and it’s our job to be able to create the best experiences for those diners and for our restaurant partners, whether that’s on a direct channel or whether that’s on marketplace,” Kate Green, vice president, restaurant services and innovation at Grubhub, told PYMNTS in an interview.

Cash payments may not be the norm for restaurant orders, but they represent a multibillion-dollar opportunity. Research from PYMNTS’ study Digital Economy Payments: Going Digital To Pay For Travel And Restaurant Dining, which drew from a survey of more than 3,200 U.S. consumers last year, found that 16% of restaurant customers paid for their most recent restaurant purchase in cash. That share amounts to $8.3 billion in cash spent on restaurant purchases in February 2022 alone.

In contrast, debit card payments — the most popular option — accounted for 37% of restaurant purchases, amounting to $25.3 billion, and credit cards — the second runner-up — made up 33%. Yet, credit card users tend to be much bigger spenders, as these customers spent nearly $30 billion in the same period.

Additionally, data from the PYMNTS report “How Consumers Perceive Surcharge Prompts,” created in collaboration with Payroc, for which we surveyed nearly 3,000 U.S. consumers, reveals that cash is disproportionately common for restaurant purchases compared to other kinds of transactions. The study found that only 2% of travel purchases and 13% of retail and grocery purchases were paid for with cash.