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DoorDash Has Pulled Ahead of GrubHub, Uber Eats in the On-Demand Food Delivery Race

Danielle Abril

DoorDash is now the top on-demand food delivery service after knocking off legacy leader GrubHub in consumer spending market share, according to data released on Monday by third-party research firm Edison Trends.

When it comes to dollars spent, DoorDash owns 27.6 percent of the market followed by GrubHub, which has steadily lost ground and accounts for 26.7 percent, reports Edison Trends. Uber Eats, which has flat lined over the last 11 months, takes the third spot claiming 25.2 percent of the market.

“If you look at DoorDash, the ground they’ve covered in the last year is unbelievable,” said Hetal Pandya, co-founder and vice president of marketing at Edison Trends, a research firm that provides companies with real-time performance analytics. “It practically looks like they took all the ground from GrubHub.”

DoorDash, led by CEO Tony Xu, has been quickly growing its business, almost doubling its percentage of consumer spend since March 2018. In July 2018, DoorDash’s market share represented just over half of GrubHub’s 34.4 stake. DoorDash surpassed GrubHub in late January, and appears to still be trending upwards, according to the latest numbers.

Though DoorDash is top when it comes to consumer spending, it trails Uber Eats in total number of transactions. This means that if Uber Eats is able to increase how much people buy per order, the service could quickly challenge, if not surpass, DoorDash in consumer spending.

Uber Eats’ smaller tickets could have something to do with its partnership with McDonald’s, which it landed in 2016. In 2017, McDonald’s expanded its Uber Eats partnership to offer delivery service from 5,000 of its more than 37,000 locations. The company said it expected to grow the service to 10,000 restaurants by the end of the year.

While that meant more orders for Uber Eats, it also meant smaller ticket items for each delivery.

In 2017, DoorDash also picked up a major fast food service, though much smaller than McDonald’s. Delivery service for Wendy’s more than 6,700 restaurants went live at the end of that year.

Market leaders in the on-demand delivery industry can change in an instant, says Pandya. Companies like DoorDash and Uber Eats constantly track sales performance and make daily tweaks—releasing new promotions, switching marketing strategies, targeting specific audiences—all of which could have major impact on the following day’s results.

Pandya said growth for on-demand food delivery often depends on four key items: the price point of restaurants on the platform, the promotions and discounts the delivery services offer, and the cost and retention of new customers.

Uber Eats likely experienced rapid growth shortly after launching in 2016 because it had a built-in marketing tool with Uber’s ride-hailing services, Pandya said. Though over a longer period of time, DoorDash was able to achieve similar growth without the benefit of having product recognition, she added.

“A year ago we wouldn’t have been talking about DoorDash,” Pandya said. “Things are moving really fast in this space, and you can never tell what’s going to happen.”