ALEXANDRIA, Va.—In a move to turn a profit, DoorDash has begun to sell ads for restaurants above the search results, reports the Wall Street Journal. DoorDash has had ads in the app as well as banner ads, but having the ads above its search results is new for the food-delivery company.
Restaurants can purchase ads via a self-serve ad platform, which DoorDash built, that allows them to purchase ad placements via a bidding system without the help of an ad-sales person. Restaurants only pay for the ad if a user clicks on it and orders, and they can choose if they want to direct their ad to new customers, existing customers or all customers.
“Any mom-and-pop shop can go in, set a budget, and we only collect dollars if they get a transaction,” Toby Espinosa, vice president for DoorDash Ads, told the Wall Street Journal.
Additionally, DoorDash is launching “featured listings” for consumer-packaged goods brands to boost their placement within the convenience and grocery categories.
UberEats introduced sponsored listings last year with a pay-per-click model that charges merchants each time a consumer clicks on the ad, even if they don’t make a purchase. Grubhub allows restaurants to secure better placement in search results and provides other marketing help on a commission-based system.
Recently, DoorDash filed a lawsuit against New York City over a law that would require it to share customer information with restaurants, such as a customer’s name, phone number, email and delivery address, in order for restaurants to complete a customer’s order. New York City has decided not to enforce the law while the lawsuit is being settled.
The issue of access to customer data when restaurants and convenience stores use third-party delivery services like DoorDash has grown contentious. Businesses that rely on the third-party model want to ensure the best customer service, reduce fees associated with the partnerships and access to customer data to help with marketing and loyalty programs. NACS Magazine covered the tradeoffs between using third-party delivery services and using store-owned services in “Delivery Dilemma” in the September 2021 issue.