It's disheartening that there's so much due diligence required just to conduct the most basic transactions right now. I have a narrow list of vetted restaurants, where I understand the costs and to the business, the delivery model, the safety (food handling and Covid precautions), and I only take out from these particular places. I tried a new place recently, only to find out I had been duped by Grub-hub, even though I thought I had placed the order on the restaurant's own site (or so I thought). When I went to pickup, the owner set me straight and gave me his card with the correct number. He showed me that I had paid an additional $25 in markup, as well as the fees he was charged, and this was a pickup!
The due diligence is because the restaurants offer a terrible experience.
Most still do not have an independent online ordering function. They want me to call.
Most still haven't set up meaningful profiles on Yelp and other review sites. So I would need to root around to find contact information.
That is in addition to needing to give my credit card over the phone, not knowing how long the order will take, and needing to be concerned about the person hearing the order right.
The restaurants are barely trying to compete for customers.
I don't understand why this isn't treated like domain name hijacking, though.
Suppose you want to go to McDonald's. I buy the McDonald's domain name. I put a credit card form on my site, and I "deliver" McDonald's to you. I charge a $40 surcharge for the privilege.
There is no way in hell that McDonald's would have to go begging at realmcdonald's.com because of my shenanigans. They'd have no patience for this bullshit. In real life they'd sicc a DMCA notice and a ton of lawyers on this and I'd lose my webhost and the sheriff would come visit me and who knows what else. They'd get McDonald's.com fast enough to make your head spin, and I'd be pushed out of that business.
Why is it different for restaurants?
Same problem: instead of me it's a company, and instead of McDonald's it's a small restaurant. But the principle is the same.
In domain name hijacking, it's presumed wrong because customers think they're reaching McDonald's when they're really calling me. In the GrubHub case it's exactly the same thing.
I don't understand why it's wrong when I do it, but it's not a problem GrubHub does. After all, McDonald's doesn't deliver, and I may own a very fine delivery business, but I'm still not allowed to coast off their name for my own business.
> I don't understand why it's wrong when I do it, but it's not a problem GrubHub does.
The same reason that you'd be arrested for running an illegal taxi, but when Uber does it, it's fine. And the same reason that you'd be arrested for running an illegal hotel, but when AirBnB does it, it's okay.
Uber and AiBnb spend a lot of money lobbying governments at every level, and on marketing to make what they do seem acceptable.
I dont find this convincing, taxis are mad because it's competition, the restaurants are mad because its impersonation. The restaurants should be entitled to civil suits to reclaim damages while in the Uber/AirBnB situation its more about regulations that the government failed to enforce.
I agree, however liability should go much further than just civil damages, and should enter the territory of criminal fraud and trademark infringement.
If I impersonated Disney online and used their trademarks on my website, the FBI would raid my home, I'd be in prison and courts would bar me from ever touching a computer again.
Restaurants should be able to call the cops and report fraud, have it investigated and stopped, and have their cases passed on to federal authorities if necessary. This doesn't happen.
Spotify didn't have any fuckoff money in the start and the streamed stuff they got from the Piratebay. The authorities in Sweden didn't notice since they Spotify also tried at the same time to get proper contracts I guess and the music industry seemed to look through their fingers.
Youtube is more strange since they illegally hosted IP for a long while.
They'd get McDonald's.com fast enough to make your head spin, and I'd be pushed out of that business.
If McDonald's were a mom & pop restaurant and you were a multi-billion dollar, VC-backed startup, then you can be sure McDonald's would not be able to do this so easily.
I think I remember reading that they often set all of this up prior to speaking with the owner / without getting their approval and then basically go to them after the fact and say "look how much traffic we've been bringing in for you"
Edit: Ah, yup - see link to eater.com post elsewhere in the thread
Except now grubhub et all basically controls their web presence through vastly superior SEO, and if they don't agree to grubhub's terms, they basically disappear off the internet.
It did cost them money to spoof an unknowing client, but they make money having a credit card form collecting fees before anyone else knows whats going on.
Reselling is generally legal. There are no particular trademark concerns when it's ultimately the genuine goods getting to the consumer at a different price.
It's very easy to understand why consumers and businesses would be annoyed by this behavior, though, and it may be deceptive or immoral in other ways.
I mean you can absolutely do your first businesses model as long as you don't claim to actually be McDonald's your fine.
The issue here is they agreed to allow GrubHub to pretend to be them. You'd never get that deal with McDonald's since they'd just not agree to it since they know it's a horrible idea but tons of people running restaurants don't understand they are getting a raw deal.
I've had a pretty great experience calling restaurants to place orders. I talk to a human, tell them my order, they repeat it back to me, and tell me it will be X dollars and ready at Y o'clock. I show up at the specified time and the order is ready to go. A couple times I had to wait 5 minutes because they were inundated and couldn't keep up.
No stupid app to download. No account to create. No bullshit fees. No marketing emails. I just tell them what I want and then go get it. It's refreshing.
I agree 100% with you. I think the expectations of the parent comment are very misplaced.
Restaurant owners are usually not tech people, nor can many of them afford to hire tech people. To expect all restaurants to pay exorbitant amounts of money setup/ maintain online ordering systems is not realistic.
Also, I have never had a restaurant ask me for a card over the phone. Order times are a rough guess based on current traffic, no matter over the phone or an app. And 9 times out of 10 the server repeats your order before hanging up. If they don’t, it is easy to ask them to.
To be fair, I have been surprised many times how difficult it can be to find an online menu for places I like in my area. Lots of places might not even have a website, but in these cases, I actually use GrubHub and the like to read the menus only. I never order through them.
Here is an easy way to beat these broken GrubHub shenanigans. Find an online menu, or use GrubHub only to read the menu menu if need be. Find the real phone number on Google maps. Place your order over the phone. Pick it up yourself and save tons of money on fees (and now apparently save the restaurant from getting screwed too). Make sure to pick up a paper menu on your way out for next time :)
> To be fair, I have been surprised many times how difficult it can be to find an online menu for places I like in my area. Lots of places might not even have a website, but in these cases, I actually use GrubHub and the like to read the menus only.
Don't. Do. This.
Grubhub menus are often incomplete (and we all know the prices are wrong). I just checked a nearby restaurant I often frequent and the items I usually buy are not on the Grubhub menu.
If they don't have a web site and you want to see the menu:
Go to either the Google Maps listing or the Yelp listing.
If Yelp, don't click on the menu if they have one within Yelp.
Instead, click on the photos. You'll almost always find photos of the menu uploaded by Yelp users.
Just FYI, the menu photos on Yelp are not guaranteed to be up to date, either. The only real way to see what the restaurant's actual menu is without going there is if they have it up on their own website.
It's more common than you think though. I know of restaurants that change their menus daily or weekly. Most don't, but you will run into it if you eat at enough places, and I highly doubt someone is going to post a new photo of the menu every week.
Or just ask the human being on the phone with you if $ITEM is still being offered for $PRICE. The beauty of communicating with humans instead of machines is there are no rules, you're allowed to go 'off script' like that.
I’ve tried the menus on Google maps as well, but found them to be even more inaccurate than various delivery services. I assume if a restaurant maintains their google presence they can edit their menu by hand but this seems to be rare. Otherwise, I’m pretty sure I read somewhere these ‘menus’ are auto-generated by ML algorithms based on the photos of food people post.
Which actually, is pretty impressive when you think about it. It’s not worthless. Even if not totally accurate, it will give you a rough idea of the most popular dishes!
>Also, I have never had a restaurant ask me for a card over the phone.
If you want to pay for delivery (not pickup) with a credit card and the restaurant doesn't have online ordering then you'd read the credit card over the phone. Of course you have to say the words "I'd like to pay with credit," otherwise they'll assume you'll pay cash on delivery. Really standard before online ordering became big.
Some restaurants even have a POS system that when you've used a credit card in the past to pay for a delivery order with the phone number/address combination your using for your current order they'll ask you "would you like to use Visa ending in 1234?"
As an aside I didn't know it was a thing until I overheard my roommate doing it. This was 15 years ago now.
I think a lot of the lashback things like grubhub, uber eats is getting lately is precisely because people have become more tech savvy. The "magic" of the app isn't magic anymore to the current generation of users, and they just don't see the value in it that the previous one did.
My opinion: As it becomes more and more commonplace to have "just enough" technical expertise and the tooling is easy enough to DIY, we're going to see services like grubhub become commodified and open - and they know it, so they're doing everything they can to try to keep as much market share as possible.
> No stupid app to download. No account to create. No bullshit fees. No marketing emails. I just tell them what I want and then go get it. It's refreshing.
That's how it always was, I really don't get this disconnect between people wanting to always hide behind a keyboard or smart phone when it comes to food. It's always been the most social thing I do in my entire day, as it has been done since for thousands of years, and I just can't see why people feel either super embarrassed and outright aloof when it comes to ordering food.
I mean if you know you're going to try and use an expired coupon or not going to tip well, I guess that makes sense, but in my experience most people just seem to have some inexplicable aversion towards food ordering and pickup. Yet seem to want to chat with the checkout lady about mundane matters, whereas I just want to get out asap and cook with the stiff I'm trying to buy and keep things to a minimum.
> I really don't get this disconnect between people wanting to always hide behind a keyboard or smart phone when it comes to food.
I don't want to 'hide', but my social anxiety makes phone conversations with people I don't know a harrowing experience; to make it bearable I need to work through a mental image of how a 'successful' call might go, from greeting through hanging-up, with some variations of what might happen in-between.
For a medical test related call I can force myself to go through with it, but to order food, when I can find something else that I like and that I can order via an app - I will avoid calling. I know this is quite an odd excuse, however did want to note that I at least want the personal phone contact, but can't deal with the unpredictability / stress involved that well.
> Ordering food via telephone is, to me, the equivalent of trying to use a command line interface without knowing any of the options, and instead of "help" being automated, you have to bother a person who is probably already extremely busy and overworked to clarify the menu. It's also much easier to pay with a credit card via an app or website than over the phone.
I've never heard of this perspective used to describe what takes place when ordering food, you're clearly trying to equate it to a non GUI way of trying to navigate the process as you would when on a computer. Interesting perspective, its seems you think there is some underlying 'protocol' called conversation that you simply don't grasp, or are unaware of, right?
More points to follow below.
> I don't want to 'hide', but my social anxiety makes phone conversations with people I don't know a harrowing experience...
See, this I clearly understand despite personally having had to essentially speak at conferences for a living at one point; as I think people with a clear medical condition need to be accommodated in these situations, but just know that the FOH people taking your order are more likely to be receptive to your order than not because it ensures they A: get to have a job, and B: ultimately rely on satisfying you and providing a good UX in order to get a tip in exchange for said transaction, which is the majority of their overall wages.
Now, the Industry is filled with examples of feckless and quite frankly discontent people so it doesn't always show. But just understand FOH are there to serve you, its called hospitality for a reason and the relationship needs to be approached as such (within reason). Whereas BOH (chefs/cooks) is entirely different domain, which is what I did in that Industry, and requires more nuanced ways of communicating that I won't get into.
As for the payment processing, believe me I did fintech and on the back end its only really beneficial for the end consumer, with several hidden externalizes, as its hardly 'easy' for the business owner and the staff. But credit cards are just a paradigm so ingrained into the collective psyche that it will never go away, what's even more notable is that it was the Diner's Club model in restaurants that made Credit Card usage ubiquitous in the US in the first place.
But, again I totally understand this perspective when described in this way and totally understand why an app or a online order system is preferable.
Ordering food via telephone is, to me, the equivalent of trying to use a command line interface without knowing any of the options, and instead of "help" being automated, you have to bother a person who is probably already extremely busy and overworked to clarify the menu. It's also much easier to pay with a credit card via an app or website than over the phone.
Whether or not it’s their job, one can still feel bad about doing it. When I worked retail, if we didn’t have something in stock (after looking), I’d apologize. Not because it’s my fault, but because I felt bad.
It’s the reason people don’t ask workers at retail stores for help; they (most of the time) don’t want to bother someone even though it’s their job.
I never invalidated someone's feelings. I merely stated that the logic they are using to validate their own feelings is flawed. It's very possible to change the frame of your mind through the language you use. If you remove the negative thoughts of "bothing" someone when they are merely trying to make ends meet, your feelings might change. In fact, by not bothering them, you may be giving their boss fuel for them to NOT have a job.
Yes! I don’t know why there’s so much apprehension about calling the restaurant. So often I learn more about the dish I’m ordering - does it come with X ingredient yes/no, should I order Y add-on, is rice extra. Simple questions usually omitted from online menus. Makes the experience just a tiny bit more human and that’s honestly enough for me
> Yes! I don’t know why there’s so much apprehension about calling the restaurant.
Maybe it is because I am relatively young. I grew up apps first, so all the little annoyances of phones (accents, noise in the background, dropped calls, a lack of written records, etc) frustrate me more than others who didn't grow up with apps that just worked.
I have very minor issues with phone orders that make me prefer online ordering.
Restaurants are loud, add in shitty phone signals and heavy accents - the result is communication barriers are common and you have to do a lot of back-and-forth.
Another issue is the person taking the order usually has more job duties than just taking phone orders, so they can be distracted if it's busy and forget to write something down and/or sometimes you have to call back several times until someone has a free hand to answer the phone.
Yep, same. Every time I order over the phone I'm just hoping the other person understood what I said correctly, because I sure as hell haven't understood anything they said. It's a combination of accents, very loud backgrounds, and English not being my first language.
Had a big order at a pizza place for 9 pizzas. 3 of them came out wrong. All parties involved speak my native language.
The receipt had the wrong items listed on them, because the person taking the order checked the wrong things while taking the order.
I guess it could have been verified better after they took the order, but I can't help but to feel that the order would have been more likely to be correct if I had checked boxes in an online form and verified there before sending it off.
I personally prefer using websites/app for this reason, I can just in my own time make the order, get confirmation from others with me that I'm ordering with and when everyone is happy, just submit. If I ever have the choice between calling vs ordering online, I will never call.
You're describing a good experience. Try calling a restaurant where they barely speak any English. Or one that's busy and you and the other person can't hear each other over the loud noise.
My experience on the phone differs from yours. My customizations (low salt diet or other health requirements) are ignored or done incorrectly or misunderstood due to my accent or just background noise; I have to repeat the credit card twice since it was mis-keyed; I can't save my favorites as different people pick up the phone, so starting from scratch each time. And when I pick up my order, I discover only too late what's missing and have to decipher a scrawled notepad stapled to a bag to see if it was even listed.
I agree, onboarding on these apps is miserable. But the benefits of a digital order, when done correctly, can really be better for some consumer cases than the voice call.
I've had far too many orders get screwed up over the phone, even when I've had them read back to me. Also, you still have to deal with physical payment when you pick the order up.
Unfortunately phones are pretty difficult for me personally. I'm somewhat hard of hearing, meaning that I can't necessarily understand the other side of a phone call. I've also recently moved to an area much more diverse than my hometown. While this is great and I'm meaning people from all walks of life, it also means that there are suddenly a lot more accents that I'm not used to hearing and having trouble understanding and communicating with. Ordering on the phone has not been a great experience for me...
Please consider clicking through to the link before commenting. You obviously did not do that. There's also accommodations for different disabilities, like the Deaf and hard of hearing via sign language.
>IP Relay uses an Internet connection, a computer or mobile device with a web browser and a Communication Assistant (CA) . An IP user types what they want to say, the CA relays the conversation to their caller and then types their caller's response back to the IP user. To start using IP Relay, users are required to register for a 10-digit number through the Federal IP Relay website. To make your call today, go to www.federalip.us.
>Video Remote Interpreting (VRI) is a feature of Federal Relay's Video Relay Service (VRS). This option provides deaf and hard of hearing Federal employees with on-demand remote sign language interpreting in order to facilitate communication between individuals who are in the same location (i.e. office, cubical, front desk, etc.).
> Please consider clicking through to the link before commenting. You obviously did not do that.
Absolutely uncalled for. I did click through and read the whole article. I was actually unaware of TTY until reading it and did some research into it before coming to the conclusion that it was not something I needed to invest time into.
More importantly, added another person and an internet or phone connection into the loop would add a level time commitment for the person on the other end of the phone that I would find unnecessary, which takes out most if not all of these options.
> There's also accommodations for different disabilities, like the Deaf and hard of hearing via sign language.
This is why I put "somewhat". It's never been an issue beyond leaning in slightly when a cashier is a little soft-spoken and maybe asking someone to repeat something, and certainly never bad enough to learn sign language (out of necessity, I'd still love to learn for myself at some point).
"Hard of hearing" is a veeery wide range, with the vast majority leaning on the weaker end of the spectrum. My personal experience hasn't really needed much in the way of intervention. It just makes phone calls more of a hassle than the average person.
> It sounds like you're in denial of your disability or you're just lying.
I could talk about what IP relay actually is (it's definitely more than "just chat"), my experience on the other side of it as a public-facing city-government worker, how video relay services won't work for me because I don't know sign language (something I mentioned in my previous comment), but I'm going to sidestep this entire conversation.
Insults to my mental stability and accusations of lying are far below the usual level of discourse I enjoy on HN, and I'm going to freely admit that, after some personal things and what's happening with the world at large, I got more upset than I'd like seeing that. So, I'm just going to walk away. I wish I could discuss my experiences more but I don't feel like a civil discussion can be had.
You have to give a phone call your complete attention - you can't do anything else while doing it. You need to be somewhere relatively quiet to do it. It blocks both people for the duration of the call. Some people have accents that are hard to understand. It's easier to make a mistake when reading something out or writing it down. There's no record of the phone call being made and the food ordered. Lots of reasons.
One for me is: it makes group orders harder as you have to get everyone’s order either beforehand or take breaks while getting it during the call. With an app, I can take breaks during the ordering phase until I have everyone’s.
> No stupid app to download. No account to create. No bullshit fees. No marketing emails. I just tell them what I want and then go get it. It's refreshing.
The interesting thing is that I view all those (except the fees) as benefits.
App makes it always easy to access and I can casually browse for food when hungry.
Account means I can re-order a past thing with a tap and that all my payment information is saved.
I fully agree, that's how I do it too. As a bonus, when you order from the same restaurant enough times this way and become a 'regular', the process becomes even more streamlined when they start to remember your preferences.
I beg to differ. None of the places I've placed orders with (and I've been doing it a lot what with quarantine) have ever asked for CC over-the-phone. Most just want my name, some a phone number. Ordering usually takes less time than it would to fiddle about with a bunch of dropdowns, even if it had my customer information already saved.
Speaking of information already saved, one of my favorite pizza places has my order history keyed to my phone number.
Ordering ahead usually comes down to dialing them up, giving my name and phone number and telling them I'd like the same as last time. They read it off to me to confirm, quote me a waiting time, and that's that. Start to finish, the call is probably less than thirty seconds.
One of the coolest parts of GH and DD, though, is being able to try a new restaurant without having to enter any new information.
Also, calling on the phone is not always easy; I often place orders on my phone while simultaneously on a work call, or putting my kid down for a nap, or doing something else where speaking is not easy.
It's strange that they have to ask for those details. I wonder what software they use and why it doesn't look up the customer record based on caller ID, as soon as the phone starts ringing.
What's funny is I have started to notice restaurants remembering my name when I give them my phone number. Perhaps their POS systems finally have some rudimentary CRM. So we're almost there!
Pick up. Probably less than 5% of restaurants do delivery. If you count chains as one restaurant, then probably less than 1% of restaurants do delivery.
Most Grubhub and Doordash restaurants don't do delivery.
When I say "they don't do delivery", I mean the restaurant doesn't do delivery. DD or GH provide the service to you. But if you call the restaurant directly, they'll tell you they don't do it on their own.
Which was the context of this conversation ("Why don't people directly call the restaurants instead of using GH?").
I try not to use those services too often. I don't agree with their dishonest pricing and predatory business practices. As another commenter mentioned, those restaurants don't do delivery -- your postmate or whatever is working for postmates, not the restaurant.
I've been doing a lot of takeout as most days its my only trip out of the house
My whole point is not everything needs an app. Phoning in to-go orders is one of those things that I would rather interact with a human with. There are too many ways automated ordering goes wrong and exactly 0 ways to fix it.
Same thing pizza places have done before apps: call back the number to remind them, and if they still don’t come, just eat the cost (and possible the food too).
I think the issue is restaurants need a 3rd party platform. They aren't in the tech industry and they aren't going to hire a developer to build their own system unless its a global franchise.
What we really need is for someone to build an open source / one time cost / subscription platform that gives restaurants the ease of using a premade system without the expense of having a per transaction fee.
What makes Grubhub/doordash/etc so valuable to consumers, though, wouldn't be replicated by a premade system like that, though, no matter how good it was.
The killer feature is that it is a single market place. I go on the app, I can search through dozens of local restaurants, all with a consistent interface. I can place an order in a couple of clicks at a brand new restaurant I have never tried, and I dont have to enter any new information.
I can scroll through all my previous orders at all the previous restaurants, and re-order in one click.
This service can ONLY be provided by a unified platform. It doesn't matter how good a restaurants website is, I want ALL the restaurants in one place.
Now, could it be cheaper for restaurants? Does GH take too much of a cut? Maybe, but I don't know.... GH and DD both lose a ton of money, and have spent a ridiculous amount of money to get to where they are. Could anyone provide the service for a lot cheaper? If they could, they sure haven't yet.
I think the challenge here is that all the competitors are exceptionally well funded venture backed companies that are fighting to be the winner who takes it all. We don't know what this market would look like without the flood of exceptionally venture money to finance the engineers and discounts and all.
Sustainable delivery would probably more bifurcated. I could imagine a range of food types that are delivery-centric (think pizza & Chinese) in areas with cheaper rents & smaller (or non-non-existant) dining rooms, and more delivery-optimized (high margin, easy to transport) food, with their own delivery drivers - and that a lot of other venues wouldn't do delivery, or would partner w/ a service like Lyft or Postmates when necessary, and it'd be expensive.
It might be healthier for the restaurants, but it doesn't seem better for consumers. I want a solution that still lets me only have a single portal I have to interact with to order my food.
This was kind of the dream of the Semantic web. It's a fantasy though because it promotes competition and good customer outcomes and our system's main concern is moats and profit.
I think there's a seam between discovery and ordering. If I am traveling on business, and I don't know what's in the area, then a unified interface is valuable.
But if I know which restaurant I want, then the unified ordering apps are charging restaurants for a service (discovery) that the restaurant doesn't need any more. Seems crummy.
I think you are calling for something like the Instacart Marketplace for restaurants. These already exists SkipTheDishes.com is one of them; they primarily do delivery.
> Most still do not have an independent online ordering function. They want me to call.
There's the significant chance that most of the restaurants you have to call are running at such thin profit margins that they don't have the money to spare to hire web devs or pay hosting providers, and even if they did, do you want to hand over your credit card details to some budget build order page?
It's also likely that the profit margins are low enough that the fees for something like Grubhub cut deep.
On the flip side, having to call somewhere really isn't that hard, and to describe it as "a terrible experience" is a bit mystifying.
> needing to give my credit card over the phone
Pay in cash?
> not knowing how long the order will take
You don't need a computer to tell you this, just say "How long will the order take?" to the person on the phone and they will tell you.
> needing to be concerned about the person hearing the order right
> The restaurants are barely trying to compete for customers.
That's a pretty broad brush you're using. All the restaurants in my area that I frequent don't need any help. I've ordered from them all over the phone or online through their website and haven't run into a problem that some SV 3rd party would have or could have solved. Any "improvements in experience" by yelp/grubhub is pure grift.
I do notice in my area (Paris, France) that many small restaurants hardly have an online presence. I understand some people don't like calling up restaurants to order (I sometimes am one of those people).
Indeed, in such cases, having some sort of external service aggregating information and maybe even exposing some sort of common ordering platform would be great.
However, I think that people have an issue with GrubHub (and/or others) impersonating the restaurants. They don't come out and say "Hello, this is GH, we'll connect you to XYZ". They make you think you're doing business directly with the restaurant when, in fact, they're covertly routing the order through their platform and extracting fees.
For me the actual issue is their not being open about it. I don't often go to restaurants and I don't know people working there either, but I would think that offering such a service in an open manner would be welcomed by both businesses and clients.
> I do notice in my area (Paris, France) that many small restaurants hardly have an online presence. I understand some people don't like calling up restaurants to order
and some restaurants are quite happy with their current customer base, and don't see the need to market themselves.
Restaurants are typically swamped in the massive overhead of running an actual restaurant, and are not fully up to date with every latest bit of marketing toolkit.
Because they are not fully up to date on the latest digital marketing, you think it is justified that they be subject to what is effectively hoards of VC-backed extortionists - nice restaruant you got there... be a shame if some bad reviews got highlighted ... or here, we'll just hijack your phone listings and take care of delivery for you...
At least the mafiosi would occasionally eat at the restaurants on whom they were running protection rackets...
The Due diligence is required because of these new hordes of extortionists, not the restaurants (and no, it isn't all about your trivial convenience, OMG, they want you to call and don't have the latest web technology up for every function... nevermind the quality of the food, ambiance, or service, it's all about whether you can order it through an app, isn't it?)
Yelp tends to be yet another scam in the same vein. It's fair to leave them out.
And even though your points are right, I am not sure those providers should charge as much. It's killing the golden goose in the long term, especially now.
Why should they be required to set uo anything on Yelp or other aggregators? Yelp strong armed it's way into importance, they aren't a public service. I wish fewer restaurants would cave to their bullying.
Indeed. I can't count the number of times I was trying to pick a restaurant and bypassed because they either didn't have an online menu at all or wanted me to start an online order before showing it to me.
I mean I don't blame restaurants for only accepting orders over the phone, given that the alternative is a money-grabbing monopolist trying to take away all of their customers.
Yelp is another matter full of fake reviews and spam - I can also see why restaurants don't want to have a "social media manager" doing that for them.
I mean, you're using smart vocabulary "due dilligence", "Yelp" - but how much of that is literally spammy articles that have nothing to do with the real quality of the food in the restaurant?
> ...offer a terrible experience. Most still do not have an independent online ordering function. They want me to call.
Curious reversion to what I want for everything. I don't want to do it online, I want to call for anything. Less online presence = good, in my books. Less to build profiles with.
> The due diligence is because the restaurants offer a terrible experience.
If this was true Grubhub would gladly put there name on everything, say it in the automated phone call, so people would actively seek them out for a better experience.
Running a small business is having lots of loose ends to manage by only one person. The restaurateur spends all day doing kitchen and front of house, closes the restaurant, and then looks forward to bookkeeping. They’re responsible for HR, payroll, scheduling, and marketing. They have to supervise repairs to the physical plant. Often, they forget which service you need to update to change the hours, they don’t realize that Yelp has changed their phone number to a GrubHub number until they’ve been receiving advertising bills, and even then maybe aren’t sure why it’s so expensive, etc. There are hundreds of companies trying to take advantage of you depending on the limited time you have to dedicate to everything. Why do I get so many “ads” that look like invoices? It must be an effective technique.
> Is keeping this stuff up to date actually difficult.
They usually have a zillion things to do, and this has a very low ROI. The impact to their bottom line is negligible whether they update or not. Not many people will refuse to use their business because they can't bother to update Google/Yelp/etc.
They usually do it if there's a permanent change in hours, though.
I don't know about that. Not that it's easy to measure. But I feel that if I go to a restaurant and it's closed outside their normal hours inexplicably... I am definitely less likely to come back.
This is an established long-standing tactic at Hotels.com as well-- you call what you think is the hotel based on a web search. The person on the line pretends to work for the hotel. They will even play along and say "oh no discounts are available this week" or "no I dont see any AAA discounts / corporate discounts"
The entire time -- they are trying to book you full price. The hotel loses, because they cannot give you discounts -- they either get the sale or lose it alltogether.
> The entire time -- they are trying to book you full price. The hotel loses, because they cannot give you discounts -- they either get the sale or lose it alltogether.
How is that not considered fraud? You're falsifying your identity as an employee for services you cannot provide in order to collect a fee as a middle man.
But now that you mention it, during this absurd time I actually called the number of a Thai restaurant I frequented before by searching it on yelp only to get a dead dial tone. I always suspected they were just busy as they were still doing rather well all things considered, but the woman at the counter (a local baker in my town helping out her friends in the evenings) said she never got a single call when I showed up and ordered in person and talked shop of her new kitchen that got put on hold.
I only realized this late, but they were careful never to say they worked for the hotel. I called again, almost like I had understood the end of a movie, and replayed the conversation with a new call.
Me: "Hi I'm trying to reach Marriott at Fisherman's Wharf, do I have the right number"
Them: "I can help you with that" (note the evasive answer)
Me: "Great, I have an Accenture corporate discount and this is for work, can you use corporate code XYZ123"
Them: "I dont see that on my system" (not a lie I suppose, but definitely not the truth)
Me: "OK well i have a client engagement Tues-Thurs and I need to book ASAP, what is your best rate? Do you have a AAA rate?"
Them: "You're lucky I can lock you in at {absurdly high price} - can i have your credit card"
they have better SEO. Grubhub doesnt answer the call, they just generate a phone number that forwards to the restaurant phone and then get that new number higher ranking (including google sidebar)
An hour ago I tried to order sushi. It was a larger order, several adults and Grubhub tacked on $38 in fees (not including a tip) for $120 of food. The place was 11 minutes away - I live in US southeast with a car and ample parking. They are crazy if they think I'm paying that, I'd rather eat a sandwich.
When I was 16, I was a handyman/servant for a tech billionaire. He drove a used minivan and once got in a fight with Walmart over a $1.50 package of glitter that was slightly leaky. The amount of money was not even close to worth his time, yet he did stuff like that all the time. This is not uncommon behavior.
I wonder if Shopify + Delivery by Instacart/Postmates could help here (atleast for the listing part). If anyone is listening and personally knows a restaurant owner that had this done to them, they could convince them to go this route.
Just my two cents.
>I tried a new place recently, only to find out I had been duped by Grub-hub
So you found a new restaurant, the restaurant found a new customer, and grub-hub is cut out of the (future) picture. Didn't grubhub earn that commission in this case?
I have no love (or hate) for grub-hub... but it seems like a business hired a salesperson on commission, knowing full well the parameters of the deal, and then gets upset when they actually bring in sales.
In most other industries the restaurant would be considered the 'bad guy' for trying to take the business direct and cheating the rep out of a commission.
There is no proof GH added value here. Allow me to share a related story:
In some places in Eastern Europe, for a while, you could see these people stand in front of empty, free parking spots in the street. As soon as they would see a car approaching they would wave their hands and signal you to park there. To be clear, these people were not afiliated with city hall or other public institutions in any way.
If you drove away, no biggie. If you parked, they would do a big show of moving around the car and telling you when you were too close to the curb, when you should start turning the wheel etc.
Once you were done, they would walk up to you and heavily imply they should be paid for the service they provided ("discovering" the parking space for you and helping you park). You could safely ignore them and they might cuss at you but that was about it.
My girlfriend used to lovingly call them Parking Consultants.
These GH stories have a very similar energy, with middlemen forcefully putting themselves in front of you when you follow a discovery path _that would naturally lead you to the restaurant you were looking for_ (e.g. by showing up higher than the restaurant you're tying to order from in the Google search).
Well the big problem with the consultants is sometimes they might flatten your tire or key your car if you don’t tip. So it’s as much over-eager help as it is shake-down.
The value that GH added here was that they were higher up than any of the restaurant's competitors, too.
So, absent of GH, that pizza sale, instead of going to GH, might have gone to a competitive pizza place.
So the restaurant has to evaluate-- it is better that I get the order through GH, or that I don't possibly get the order at all, and it goes to a competitor?
Grub-hub sometimes does this without the restaurant's knowledge or permission[1]. I believe in most other industries that's considered fraud or trademark violation?
That's also my understanding of it, that does sounds like a business model based on trademark violation / brand impersonation.
The only reason they get away with it is they target small restaurants which are unable to defend themselves. They would try to create a fake <yourlocalcityname>mcdonald.com, it would be taken down immediately.
That's all contingent both on OP discovering the restaurant through grubhub's tactics, and on it being unlikely that OP would have found said restaurant without the existence of grubhub's tactics.
For example, suppose a fairy told OP about the restaurant and OP then Googled it to get the number. If the grubhub MITM phone number bumped the real number/website further down then grubhub is a nuisance and a thief.
But OP also mentioned they thought they had ordered from the restaurant's web site. If that confusion is due to dark patterns employed by grubhub then grubhub is full of evil wizards who must be overcome in an epic battle.
Only if OP discovered by searching and grubhub bubbling to the top of a search where the restaurant otherwise wouldn't have appeared is grubhub the knight here.
So we need to know-- OP, how did you discover this new restaurant in the first place?
In a lot of cases Grubhub is creating websites that look official for restaurants. Few businesses are aware of this, as it siphons customers from many legit websites thanks to better SEO. There have been quite a few instances of this even with restaurants that they've never worked with.
> when you’re fraudulently impersonating a business
The article suggests diners are calling numbers from the GrubHub app. If that’s the case, the commission is earned per the agreement. Practically, the app provided discoverability.
When it appears on Google or Yelp results, assuming Google or Yelp aren’t being compensated and disclosing this relationship, that is a problem.
They can't both lack permission and charge a single business. If they're charging, they have permission (though possibly the contract was misleading). If they don't have permission, they have no ability to charge.
If GrubHub replaced the restaurant's actual phone number with GH's on Google or Yelp or whatever, what service have they provided? (Hint: the answer is: none.)
Depends if Grubhub did anything to "find" them. I.e. if some googles for a restaurant someone recommended to them, Grubhub buys the Google advertising spot for the name of the restaurant, places an ad directly above the Google Maps result and the restaurants website in the results, captures the click and demands a commission for it, what value have they added?
Would you label a sales guy you hired to find you new customers a bad guy if he camped in front of your door, talked to people coming to visit you and claimed commission?
Google charges me for the privilege of them placing an ad at the top of the search result when people search for the exact name of my business. Or if they type my domain name into a search box. I pay to win an auction to have my business be the first ad when people search my exact name.
Yelp adds value by putting my competitors above me when people search my exact name. They then offer me the deal Google gets.
GrubHub is spending VC money to win the google auction and then they offer the restaurant the great deal of handing over the profit margin to them. They’ll continue elbowing out paying restaurants after that to keep the money flowing, so the restaurant is paying for the privilege of paying GrubHub.
Haha, I like the view, but generally if I want a salesperson I want to voluntary engage in that transaction. Fortunately, in the business I'm in I can just forbid reselling in the licence except for the folks I'm getting into business with. The unfortunate reality for restaurants is that they can't.
Confusing a deputy that you are indeed someone in order to intermediate a relationship between them and that person has a skeevy air to it. It's the deception, I think.
Its astonishing delivery services have the depravity to dupe customers trying to help a hurting industry.
If you live in NYC or SF, I built a browser extension that will help you place delivery orders directly with local restaurants. It currently compares the price of your delivery across all delivery services, and within the next week, will link you to local restaurant websites if one is available. For those interested in checking, the link is https://platerapp.app.link/Gsxltl3d06
Awesome, I had exactly this idea.. you should consider expanding (if you don’t already) to direct from the restaurant services (e.g. Yoshinoya is available on doordash but also does their own delivery for way less). And then charge $1 per order and raise $1b!
i've been using this in nyc and saved 16 dollars across 3 orders which is a lot more than i have with honey. would really like to use the direct order feature so restaurants can benefit more.
Awesome idea - can I ask how broadly how it works? I would have thought pricing up a specific order on multiple apps programmatically would be difficult considering all the bot restrictions and coupons they have in place
It's possible to do this without resorting to the sleazy practices of Grubhub. I used to work for Slice, which provides order-taking (but notably not delivery) for mom-and-pop pizza shops. They don't add people to the platform without their permission. They only charge $1/order. They help restaurants digitize their menus, keep prices up to date, and they take orders digitally and over the phone. They have a large and responsive customer service department. It's all up front, honest, and affordable. It's not a direct comparison with Grubhub, since the restaurants still do the deliveries themselves, but it's a good business model and an honest company.
People were previously claiming on Hacker News that Slice was registering websites on behalf of pizza shops, and then claiming the business as theirs on Google Maps [0]. Is this false? One user claimed that the businesses were not aware of this [1].
I don't know what the company's policies are now. Could be I misunderstood how they operate, could be that they got more aggressive, could be a store owner didn't understand the details. They help owners with no presence create a presence, and many business owners aren't particularly tech savvy.
The "problem" is that it doesn't "scale" and there is not much opportunity for "growth" and "engagement", so VC scum will never do something legitimate like this and will instead attempt fraudulent practices like impersonating the restaurant's website and outranking them.
Every article I read about restaurants just seems to reinforce that they are powered by their owners hopes and dreams rather than any financial or business literacy. It makes then ripe targets for exploitation.
Restaurants and mom and pop grocery stores/convenience stores are very low margin, super long hours, and stressful. Furthermore, it isn’t just places like Grubhub but also local governments with weird zoning laws and expectations that really exploit these businesses with random fees.
(My parents had a grocery store. They lost it during the previous recession.)
Restaurants and grocery/convenience stores are a bit different. Yes, owners of both are signing up for long hours and poor pay. But the motivation is often different:
- if you buy or start a grocery store, you know you're buying yourself a job; you won't get rich, but you will make more money than you would working for someone else, e.g. if your options are limited due to discrimination, lack of fluency with local language, literacy etc.
- if you open a restaurant, you might me doing it for all the same reasons as above (think an undifferentiated Chinese restaurants, or a local pizza place). But many people open restaurants because they are into food, because they think the way they make food is better than existing restaurants, and because they think the margins are going to make the restaurant ultra-profitable.
My statement might have come across as harsh I understand that these kinds of businesses take a huge amount of blood, sweat, and tears; Especially since the ROI is often not really that great. It takes all the energy you have to run just the shop let alone comply with the city, county, state, and country regulations, source inventory, promote yourself, etc.
It doesn't surprise me they are getting exploited with the overwhelming mountain of stuff they need to manage. The small margins mean it's very hard to hire staff to distribute work too.
> Restaurants and mom and pop grocery stores/convenience stores are very low margin, super long hours, and stressful.
Sorry to hijack off of your comment - none of what I say is meant as a negative about you or your parents.
I've seen two types of people start these:
1. People from low income backgrounds who don't have many other options and don't have the means to gain good knowledge. I sympathize with them.
2. People who are somewhat wealthier (have a good degree, work for an engineering company, etc) who complain about how poorly people are running restaurants and how poor the food is and know for certain that they can run a restaurant that makes the food really well and everyone will come to their restaurant and business will be good. Very common for this to be about ethnic restaurants but doesn't need to be.
I have little sympathy for this group. They really should know better. I've talked to them about it before they put a huge chunk of their savings into starting a restaurant. They typically do no background research. They don't ask other business owners. They have no idea about the margins (hint - the other restaurants who make food poorly do it for an economic reason - not because they can't find good chefs).
Recently one of them opened a restaurant near my home. And their food was great - I would put it in the top 2 of their category in the city. But their prices were too high. Normally I order this type of food once in a while when I don't want to cook or am busy. But the price was beyond that threshold. I went there only when special friends visited me in town and took them there.
And not many people went there. The reviews everywhere (Yelp, etc) were awesome. But people didn't go there. Partly because of prices, but partly because of the location. Why did they pick that location? Because there's a big company in the neighborhood. Surely there are plenty of well paid people there who would come for lunch? Yes there are and no they won't. Over the years living there I know this plaza well. It's a graveyard for restaurants - most of them likely relying on employees of that company eating there. All these guys had to do was spend time in the restaurants in that plaza prior to signing the lease to get an idea. "Ah, but they don't go to those restaurants because their food is crap!" Yes, the food is crap. No, that's not the reason.
And then there's the food. Great food they made. But they weren't making a profit. So did they revise their menu to focus on items that would give good margins? No. They raised the prices. Fewer people came. They raised the prices again. Even fewer people came. This spiraled out of control. Within a year they had shut down. One of the co-owners told me there wasn't a month where they made a profit. I asked "Did you talk to any restaurant owners for their advice prior to opening?" Nope. If the food is great, people will come.
These guys work (or worked) pretty good jobs prior to opening the business - sometimes in senior management roles. Is that how decisions were made at their companies?
No its the landowners who can hold them over the barrel for their highest overhead: rent. And those same landowners are able to do that because they have enough wealth to wait on the next person who will initially pay the high rent.
> No its the landowners who can hold them over the barrel for their highest overhead: rent. And those same landowners are able to do that because they have enough wealth to wait on the next person who will initially pay the high rent.
Yes and no. There are landowners with a lot of wealth. The majority of landowners have less wealth (and will always have less wealth) than a typical FAANG engineer.
I started looking heavily into real estate last year and got to meet many of these people. The average commercial plaza in most cities? Not owned by a wealthy person - and indeed some of the business owners on the plaza are wealthier. A lot of these owners don't make enough out of it to make a living and still have a full time job.
They do it because it's passive income - almost no effort. Plaza owners typically don't pay for any maintenance. They don't pay property taxes. All this is passed on to the businesses in exchange for relatively low rents. As long as he collects enough rent to pay the loan, and has some extra left over, he's happy. It's free money.
(And 90-99% of land owners don't own the property free and clear. The majority of them owe more than half the value to some bank or other. That should tell you who really is making the money).
> restaurant food is 7 to 20x more expensive than home cooked
I suspect Efficiency is Everything is measuring a very different thing. They seem to focus on calories per dollar, which is not how restaurants or home cooks typically think.
The rule of thumb used in the restaurant industry is 30/30/30/10. 30% for food, labour, rent, and 10% margin. Anecdotally, for dinner I spend about £3 a meal to cook at home, and could probably buy that meal out for £8-12.
As Efficiency is Everything says, you can live on $1.50 a day, but it requires using only a very limited subset of ingredients and allows little room for preference. For some people this makes no difference, for most it's a huge handicap, which is why it's limited to the min-maxing fringes.
I'm not sure laziness is the main factor here though. I suppose it depends where you are ordering from, but I enjoy picking up from restaurants still largely because I enjoy the food and would not be able to recreate it. In some cases it introduces me to new flavor combos that I wouldn't have tried otherwise and maybe will eventually make its way into my cooking. Hell, I even just occasionally crave McDonalds. If I were feeling lazy I would have Soylent or throw together a sandwich with whatever is in the house, it feels like more effort to place the McD order than do that.
Food is a large source of enjoyment for a lot of people, even removing the social benefits of in-person restaurants, I don't think it is a waste. Although certainly many restaurant owners would benefit from some business training.
I also think you'll find you could say the same thing about a lot of life chores- people pay other people to sew? People pay other people to mow their lawn? People pay other people to trim their hair? And so on. A lot of these things could be done sufficiently yourself, but 1) they will generally be done better by the professional and 2) as these things pile up the total time spent will become a legitimate burden.
I found it interesting to read about the daily schedules of housewives back in the 50s or so, some of their tasks could be automated now or would be considered unnecessary, but even adjusting to be a bit more modern it sounded like a difficult full time job. And there are increasingly less people "employed" in this sector. So I don't know why I see so many objections to outsourcing something like cooking (not even all the time).
You can also spread the message to your friends and family. That Grubhub, uber eats, etc are not the best way to support a local business, and that they conduct these deceptive tactics.
I’ve had friends in the past week state “I’m supporting local tonight” and then continue on to state they ordered via uber eats.
They’re upset to know, but thankful to be informed, that ordering via uber eats doesn’t actually support local in the way they believe they are.
The whole fake websites / fake phone numbers just adds to the bad taste, supporting local does not align with supporting deceptive middle men.
Restaurants want this service, they just want it at a fair price.
The argument isn’t so much “grubhub charges a fee” more that “grubhub uses its monopoly position in a local market to further monopolize distribution channels and thus charge monopoly prices“
> This is wrong ! Plain and simple. $6.42 is probably more than the cost of the coffee.
While I think they shouldn't be charging nearly that much, that's a misleading way to look at it.
The charge is based on the average. When you step back and look at the entire month, it's going to be some negotiated percent of the total. For some orders it will be way under, and for some it will be way over, but it will balance out.
When you order just a coffee it drags down the average. Then, example numbers, the fee next month might be 3 cents lower across 200 orders. This saves $6, making the net fee $0.42
That $6.42 is what the restaurant is paying to GrubHub due to their flat per-order fee, not what the customer is paying for the coffee. It's not like the restaurant is charging $10 for coffee and losing sixty-four percent of that; it's normal coffee at normal coffee prices at the restaurant's end. They're out of pocket every time it happens.
> The redirect number can also appear higher in Google search results (including the Google panel for that business) than the restaurant’s own line.
This seems like a pretty fundamental failure on Google's part. The whole value proposition of Google is that they'll find you the best answer for you search, not just 'an' answer that could be misinformation. This is the problem with the way their ranking algorithms tend to favor information aggregators. It's easy for second-hand sites to out-rank the source of truth. It reminds me of the way Pinterest has degraded the Google image search experience by polluting the results with their own low-quality entries.
Now I get that automating the gathering of this information must not be easy. How do you verify the legitimacy of any one page claiming to be the site for a restaurant? What I don't understand is how Google can see that sites like Grubhub are exploiting the ranking algorithm to re-route users, but they don't do anything about it. Why don't they penalize those sites?
IIRC, this was also an issue during the 2018 cryptocurrency rush -- fraudulent support phone #s for big exchanges / companies like Coinbase would show up higher in the rankings than the legitimate number. Frustratingly and amusingly, the fraudulent phone numbers were supposedly better-staffed and more responsive.
Can Grubhub do this phone scamming thing if the restaurants don’t agree to work with Grubhub? If not, it’s on the restaurants to figure out they’re being scammed and cut off Grubhub. I agree it’s extremely sleazy but if restaurants opt into it what can you do?
Regarding online ordering: restaurants need to decide if this is a space they want to be in (to grow business by allowing another channel for ordering) then research the field, pick a vendor with a fee model they like (or build their own!) and get actively into the game. For better or worse this is like having a phone number however-many years ago. You can choose not to but the technology is getting more and more popular so if you want to “keep up” you have to learn a new trick.
There are some up-front flat-fee vendors out there that will allow you to set up your menu for online order at your domain. And if you don’t want to spend the time, Grubhub will do it for you for a fee, and if you don’t want to pay the fee or spend the time, then cross your fingers and hope your customers are ok ordering by phone. But online ordering is not going to come out of nothing at no cost.
“ In July, New Food Economy reported that Grubhub was buying restaurant web domains without restaurants’ knowledge or consent, and though Grubhub argued it’s technically allowed to do that in the contract, it was still a bad look.”
“In the contract” implies the restaurants are opting to work with Grubhub and pay them fees.
As for “non-partner” listings, how can Grubhub charge a fee if the order is phoned in or payed over the counter like a normal order? So I don’t think that situation is one where restaurants are paying Grubhub any fees (though Grubhub is surely charging customers fees and possibly marking up menu items, the latter of which I agree is shady and should be stopped.)
I am happy to be mad at Grubhub but I’m not condemning them for charging a restaurant a fee the restaurant agreed in writing to pay. Why did the coffee shop in TFA agree to pay $6.76 or whatever per call??
Yeah for this reason I always try to just go the company's website and call them. some redirect me to chownow, which is ok, as long as I know that you'd rather let them handle the order instead of the phone.
It's even more infuriating knowing that Grubhub is running these emotional "support local restaurant" ads that imply that using their service is somehow a form of activism while they steal from those very same businesses.
Don't most people use Google Maps to find nearby restaurants? Does Google Maps ever give the wrong phone number to order from?
I know using the phone is kinda 1900s but sometimes I like to ask about a certain dish I'm trying and stuff. Sometimes the person talking to me is a bit gruff but I tell myself it's OK because at least I'm not giving any money to the delivery companies.
I hope it goes without saying that I always pick up. Any excuse to get out of the house, especially on a work day!
Even worse than just the misleading practices - we've been unable to connect through these proxied phone numbers at all. We just get an out of service tone. Both at&t and T-Mobile. I have been assuming it's because too many people are calling. Next time I pickup, I'll ask for a direct line.
I'm wondering if they changed their policy in SF or if the restaurants I looked up just have opted out of this.
I checked Phat Philly (all phone numbers on their website, grubhub, yelp, and google maps were the same). Same with Sultan Kebab & Gryo King (I couldn't find a number on their site but everyone else had the same number)
I am only getting takeout from places I know.
I have there menus in a drawer by the fridge.
That way, I know I am calling directly.
Much of the gig economy is just shyster business, wedging themselves between actual customers and actual providers, and taking far more than the actual value they provide.
I love this paragraph from the pizza arbitrage article, link below.
If capitalism is driven by a search for profit, the food delivery business confuses the hell out of me. Every platform loses money. Restaurants feel like they're getting screwed. Delivery drivers are poster children for gig economy problems. Customers get annoyed about delivery fees.
Food delivery is simply a terrible business. People must have seen how much waiters on wheels charges, and how much pizza places charge and said if we get costs down to pizza delivery and charge less than waiters on wheels, we'll make a bunch of money.
The problem is restaurants with enough delivery volume to justify their own delivery service can send a driver out with several orders, and can schedule the next round of orders to be ready just as the driver gets back. That's hard to do in the order whatever from wherever model, and one order per delivery run ends up with costs high enough that a lot of people would rather pick things up themselves.
The lure of more business for local restaurants. An uptick in orders and free advertising could certainly help!
The lure of a weekend job for drivers. I've done it and made out pretty well on my motorcycle for a few hours on the weekend.
consumers love apps and they love being able to have visibility into the status of their orders. They want to shop online for food and have it appear without of phone call, or to discover new restaurants around them. Sometimes they have favorite sit down restaurants that aren't take out spots - but know they might have a listing on a fancier food delivery service.
App creators: take a cut off of everything on the top without actually inventing or doing anything. A logistics company elsewhere caught charging this much would be laughed out of the room but in a new and exciting field there's a lot of room for markup.
> A logistics company elsewhere caught charging this much would be laughed out of the room but in a new and exciting field there's a lot of room for markup.
I would argue that they are also the owner of many of the customers. DoorDash owns me as a customer simply because when I am hungry, I turn on the app and select from one of the offerings.
Grubhub’s CEO said on an earnings call that customers are “promiscuous” and not demonstrating loyalty to a single dining app, so while you have your anecdote, it doesn’t appear to apply across larger sample sizes.
Sure, but are they also promiscuous about ordering from the restaurants themselves or just across apps?
I am also promiscuous across apps (DoorDash just because I got the DashPass for during the pandemic), but it has been years since I ordered anything other than pizza directly.
So the industry as a whole just owns the customers rather than the restaurant.
I have a bit of a different take on things than you're voicing.
Right now we have a bunch of (dine-in restaurant) businesses whose models have been disrupted by both the pandemic and government action; many of these restaurants have responded by emulating an adjacent type of business (delivery restaurants). The real problem is that the dine-in restaurants have a cost structure which does not allow them to compete with the delivery restaurants. Dine-in restaurants rely on fewer customers with higher average bills, and more profitable items on orders (especially liquor). Dine-in restaurants also have expensive facilities, due to rent, tax, and maintenance expenses.
You cannot successfully transform a dine-in restaurant into a delivery (or take-out) restaurant by simply putting the food in bags.
It's venture capitalism, I guess. Enough cash became available for high-risk, high-reward ventures at a massive scale. The result has been this experimentation with platforms that undercut competitors using VC cash and have some vague plan to make a profit in the future when they've grabbed all the market share. In the meantime, plenty of individuals are making money off the scheme, while the competing businesses and the shareholders left holding the bag at the end will be the ones screwed.
Just try to make sure you've found the real website and not one of Grubhub's autogenerated fake sites. They all look pretty similar so you'll be able to identify them after you've seen a few, but it's easy to mistakenly think you're at the real site the first time.
There's nothing to keep Grubhub from changing their site design. And someone else might get the same bright idea. So learning what a fake site looks like isn't going to be a long term solution.
I wouldn't say "most". The small local restaurants that you really want not to get taken by predatory schemes are the ones least likely to have a web presence.
This is MITM and in many respects extremely unethical. I admit that the premise is clever but it’s little more than ripping people off. There’s no value add to the customer that I can see.
It's supposed to help restaurants with admin and delivery stuff, which, in turn, would make it easier for customers to order and maybe even provide faster delivery but, in its current implementation, it's just a way to skim money off of the restaurants.
If GrubHub brings awareness to your restaurant that turns into an order why shouldn't they be compensated? You may not like the commission. Don't like it, leave.
The only case I think is a step too far is if GrubHub uses their search rank to display results above a non-participating restaurant and attempts to extort commissions by displaying a proxy number anyway. Is there any evidence of this?
If a customer decides to store the proxy number in their address book thinking that it's a direct line and GrubHub charges the restaurant for each call, then that's a bit scummy.
In all cases where GrubHub has the first result in my area, they didn't do anything to "make me aware" of the restaurant I'm trying to order from. All they're doing in many cases is making it a pain in the ass for me to order via the restaurant's own delivery page.
If GH takes a 25% cut, then they need to be adding 25% more revenue to the takeout market. I would bet good money they are not.
Instead, they are paying for ad space to siphon the traffic of already hungry customers looking to order from a restaurant.
GH then shows the numbers to the restaurant and says "Look how much business GH brings you. You need to pay us for this"
In many cases they are extorting restaurants over what would be organic web traffic. In these cases they are not adding new revenue to the industry, and are instead choking the restaurants that already operate on thin margins.
The redirect number can also appear higher in Google search results (including the Google panel for that business) than the restaurant’s own line. This leads some customers to call it even if they don’t intend to use Grubhub.
Why don't the restaurants just dramatically inflate their prices to accomodate the Grubhub fee? I don't understand why it would be better to contact the restaurant directly for the restaurant -- they benefit from Grubhub too, and if they don't want to pay the cost they should just pass it on to the customers.
The restaurants have voluntarily entered into this arrangement. If they can't afford to operate with the fees on top of their regular prices, then they have to increase their prices.
That's presumably against the terms of service they agreed when they decided to work with GrubHub. The real fix would be for the restaurant to stop using GrubHub. Unless I'm really misunderstanding what's going on here.
