Tech

The future of DoorDash and Uber Eats is all in about an hour

Door dash Of a corporation

dash -1.66%

And Uber Eats’ ambitions are bigger than your lunch.

They are looking for a whole new category of logistics, increasingly touting their expertise as speed and convenience rather than food. Companies have maintained their growth in so-called next-hour commerce, including delivering everything from drugstore staple foods and alcohol to pet food on demand. Ultimately help them profit..

Amazon

Allows next day delivery. We intend to strengthen our commerce the next time, “said Raj Beri.

Uber Technologies Of a corporation

Uber 0.24%

Global Head of Grocery and New Vertical

Food delivery apps need to cling Consumers earned during pandemic lockdownWith the wider range of items available on demand, consumers have more reasons to continue using the app, and executives are betting that they will continue to use it once they get used to it.

Uber and DoorDash, which operate in the red, are also betting that expanding the range of services they offer will lead to a reduction in profits.

With groceries Alcohol orders are usually more advantageous It brings higher profits than food.Says the app can be lowered Their shipping charges By bundling hot foods with groceries and other perishables, drivers can process multiple orders at once without having to worry about the orders getting cold.

However, some drivers say these new types of deliveries can be frustrating. Some retailers have in-store shoppers who pick and pack orders, but others don’t. There is also. In such cases, Uber and DoorDash drivers say they are both responsible for delivering and shopping for their orders.

Randy Stokes, a delivery driver based in San Diego, recently said

Del Taco restaurant Co., Ltd.

When DoorDash stops at a nearby CVS and asks her to buy 10 items for another customer.

Food delivery apps need to stick to consumers earned during a pandemic lockdown.

“I didn’t know the store, so I spent a lot of time looking for it,” she says. Stokes didn’t complete the order and wasn’t paid for the job, worried that the food of the other guests sitting in his car would cool down. “I’m angry. I’m angry. I went out and delivered a hot order, “she said.

The enhancement of last mile logistics for retailers and other companies where customers place orders directly on their websites and Uber and DoorDash deliver them is because they are waiting for them when they arrive. , Smoother than ordering via the app.

Macy’s Co., Ltd.

And

Petco’s health and health Co., Ltd.

Started using the DoorDash driver to deliver online orders during the health crisis.

Also, these last mile orders will be more profitable than the app itself. Shipping companies do not spend money on marketing or discounts to facilitate orders, nor do they refund consumers in the event of any problems.Like a retailer

Walmart Co., Ltd.

This means that the app can combine multiple orders for fresh food to reduce shipping costs.

DoorDash was dealing with Logistics for companies such as Wal-Mart Even before the pandemic. In late 2019, we signed our first partnership to provide consumers with convenience products such as toilet paper and toothpaste. That part of our business expanded when the health crisis broke out.

Fuad Hannon, Head of DoorDash’s new industry, said:

In the first quarter, DoorDash non-restaurant orders increased 40% from the fourth quarter of 2020, accounting for 7% of all orders. According to Uber, the company’s non-restaurant business grew 70% over the same period.Doordash earlier this month Raised full-year outlook Total orders placed on the platform have increased from $ 33 billion set just a few months ago to $ 38 billion.

In the first quarter, DoorDash non-restaurant orders accounted for 7% of all orders.

Growth is big and fast. According to research firm YipitData, DoorDash accounted for 58% of convenience delivery sales in mid-April, up from 16% a year ago. It shattered the advantage of industry leader Gopuff. According to YipitData, Gopuff’s market share fell from 57% to 27% over the same period.

Earlier this month, Uber Eats announced that it would integrate SoftBank Group-backed Gopuff into its app.

Philadelphia-based Gopuff operates more than 400 warehouses and holds inventories ranging from groceries to beauty, babies and pet products, said Dan Folkman, senior vice president of business. I will. Uber’s Beri said the partnership was appealing because Gopuff worked directly with its suppliers to improve the profit margins of the products it sells. He added that the company operates its own warehouse and can plan to build new warehouses in high-demand areas, resulting in faster deliveries.

In the midst of a pandemic, demand for food delivery has skyrocketed, but restaurants are struggling to survive. In a highly competitive industry, delivery services are struggling to gain market share, while facing pressure to lower fees and increase employee protection. Video / Photo: Jaden Urbi / WSJ

Executives

Walgreens Boots Alliance Co., Ltd.

The company, which listed its products on DoorDash during the pandemic, said it was impressed with the app’s ability to handle all 20,000 products online.

Stefanie Curley, Head of Digital Commerce at Walgreens, said, “Other partners’carry your 2,000 items in our app’, while DoorDash says’carry everything in our app.’ I was saying. “

Walgreens enables consumers to order products through DoorDash. It also works with DoorDash to process your own online orders. Walgreens employees shop and pack orders received through the pharmacy website, but so-called Dashers need to shop for orders received through the DoorDash app, Curley says. ..

With operations in more than 70 countries, Uber states that it is one of the largest grocery delivery services in Mexico, Japan and Australia. Uber and DoorDash haven’t yet challenged Instacart Inc.’s lead in the US, but this category has emerged as the next frontier of competition. Instacart launched a 30-minute delivery earlier this month.

Grocery executives say food delivery companies are seeking them for more lucrative deals and touting the value they can add.

“They are knocking on everyone’s doors,” said Neil Stern, CEO of Good Food Holdings LLC and owner of the grocery chains of Bristol Farms and Lazy Acres.

Share your thoughts

How has the pandemic changed the way you use your carrier? And do you think new habits will continue to take hold? Join us in the conversation below.

Instacart, More than half of US grocery delivery sales According to YipitData, it offers low commission rates to stores that promise exclusivity, emphasizing the larger basket size of shoppers. DoorDash’s Hannon says his company is touting delivery speeds, expanding customer base, food delivery experience from restaurants, and attracting grocery stores with cooked food. Uber is touting its international presence, which appeals to grocery stores with a global footprint, Beri said.

Mike Molitor, head of e-commerce and loyalty at grocery store Bashas’ Inc., said he has received suggestions from multiple carriers. He is carefully considering whether to go all-in to a single provider.

“Do you want all the eggs for me?” He said in one basket.

Some drivers say buying these new types of deliveries can be frustrating.

The next act of the distribution app

Write to Pretica Lana preetika.rana@wsj.com And Jewon Kang jaewon.kang@wsj.com

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The future of DoorDash and Uber Eats is all in about an hour

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