Grubhub’s New Ordering Tools Will Help Protect Restaurants From Grubhub

Grubhub unveils new commission-free ordering tools for restaurants

As restaurants face a long and difficult winter on top of an already devastating year, Grubhub is introducing a new set of tools for restaurants to drive online orders without having to pay the Grubhub extra marketing commissions. With the tools — which include a direct-order link to use in email or on social media, a customizable button to put on restaurant websites, and a QR code to print on signs and mailers — restaurants will still have to pay Grubhub an order processing fee, as well as a delivery fee if they use Grubhub drivers to fulfill the order, but they won’t have to pay the marketing fees that eat into already thin margins.

The new commission-free tools come amid a growing backlash against food delivery apps like Grubhub and DoorDash, which have experienced a boom in sales during the pandemic, while the restaurants whose food they deliver struggle to survive. In response, a few cities and states have moved to cap delivery app commission fees, and some restaurants have urged customers to order directly from them rather than go through third-party apps.

Grubhub Chief Revenue Officer Seth Priebatsch told CNBC that Grubhub is attempting to take a longer-term perspective on the health of the restaurant industry. Without restaurants, platforms like Grubhub won’t have any food to deliver — and if the backlash to these apps continues to grow louder, then it makes sense from a business perspective to get ahead of it and align themselves with the restaurants instead of being seen as against them.

“This is one of the ways where we know we can help them monetize better traffic that they’re already getting, that’s already visiting their website or on their email list, and we want to be their partner in turning that traffic into orders,” Priebatsch said.

Grubhub, which was acquired by Dutch food delivery company Just Eat Takeaway in June for $7.3 billion, has previously run into trouble for listing restaurants on the platform without those businesses owners’ permission, with the justification that it does so in order to “not be at a restaurant disadvantage compared to any other food delivery platform.”

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