DoorDash and Uber Compete to Increased Delivery Subscription Usage

DoorDash and Uber are actively competing with each other as part of efforts to increase the number of their user bases.

DoorDash and Uber Compete to Increased Delivery Subscription Usage

Restaurant aggregators, within the framework of their activities, which are conditioned by the laws of the market as a financial system and business space, direct considerable efforts to achieve the highest possible level of customer loyalty and receive part or all of the share, as for the most ambitious plans, sometimes poorly connected with reality, of competitors.

DoorDash’s strategy was to focus on high-frequency delivery of food from restaurants at the initial stage of work. This concept of activity is based on the assumption that within the framework of the mentioned format, circumstances will be formed that contribute to an increase in the share of food costs in the structure of everyday consumer spending. This was announced by the chairman of the board and chief executive Officer of the company Tony Xu at a telephone meeting this week.

The head of DoorDash says that the highest level of efficiency and effectiveness is characteristic of those subscription programs that are used by customers most often. He also noted that delivery from restaurants is the largest and most common category in the relevant business segment. According to him, people are interested in such solutions because it is important for them to balance their expenses correctly, which is a matter of survival in its material aspect.

Tony Xu said that the company he heads, which is present in various retail categories, will soon focus on measures to stimulate the active use of the branded subscription program by customers. He did not disclose the number of participants in this program but noted that the second quarter of 2023 was a record for it. Ravi Inukonda, the company’s CFO, added that the growth in the number of users in DashPass has a continuous dynamic, fixed quarter after quarter and year after year.

At the same time, Uber is also concentrating efforts on encouraging the use of Uber One membership, which includes Uber Eats offerings. In this case, the company focuses on the goal of increasing the level of customer loyalty. This was told by the general director of the company, Dara Khosrowshahi. According to him, the firm is less focused on profit, focusing on attracting customers and retaining the Uber One product. The rate of profit received from the actions of participants in this corporate system is lower compared to other segments of the company’s business, but their lifetime value, as stated by Dara Khosrowshahi, is much higher.

The head of the company said that the monthly expenses of participants exceed the expenses of those who do not have a membership in Uber One by a ratio of 4 to 1. He also noted that retention among participants is 50% higher.

DoorDash is the leading food delivery aggregator in the USA. According to the results of a special survey, which was attended by about 2 thousand people, it turned out that 77% of them interact with the food delivery service from San Francisco. 49% of respondents reported placing orders in Uber Eats.

In the second quarter of this year, the total value of DoorDash orders reached $16.5 billion. A similar indicator of Dara Khosrowshahi’s company is equal to $15.6 billion. This is a tangible gap, but not insurmountable.

DoorDash occupies a dominant position against the background of the more modest position of Uber Eats in the United States, but at the international level, the balance of power is distributed opposite to the state of affairs in the American market.

As we have reported earlier, DoorDash’s Grocery Business Grows to Record-High 532 Million Orders.

Serhii Mikhailov

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Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.