Grubhub announced Grubhub+, a new membership program to expand its rewards program and keep customers locked into the system. Founder and CEO Matt Maloney said it expands the company’s robust reward programs even further, a key strategy the executive team emphasized during its latest earnings call.
“Generous diner rewards are at the core of Grubhub’s competitive strategy. As the only profitable company in our space, we are leveraging our profits to stay laser-focused on having the most restaurants in the network and giving away as much free food as possible,” Maloney said in a press release announcing the program. “With the most restaurants and the best loyalty programs, we believe that we have the right formula and are ideally positioned for success.”
Last year, the company introduced a Perks program for special promotions that allowed users to tap into restaurant loyalty perks and what it called a “treasure trove of offers only available on Grubhub.” According to the company, $200 million in rewards were redeemed across the platform in 2019.
Like other plans from delivery providers, the $9.99 monthly subscription offers unlimited free delivery from Grubhub+ restaurants “including many popular brands.” That suggests every one of the company’s 300,000 restaurants in the system won’t be available. The website’s landing page for the program said there is a filter for eligible restaurants within the app.
The program also offers 10 percent cash back for participating restaurants on Grubhub+ orders, and allows “VIP access” to special-care teams for priority assistance and membership perks, local events and other “experiences.” Charity rewards and matching within Grubhub are expanded as well. Chief Product Officer Sam Hall added that the new program will allow a “dramatic expansion” of its charitable giving.
Diners can sign up for a free 14-day trial, and students on Grubhub+ campuses will receive the program for free.
Plus is pretty similar to other programs, but with a few differentiators: The DoorDash Dashpass is $9.99, but only covers orders greater than $15 and includes select restaurants. The Postmates program is $9.99 per month or $99.99 per year, and includes all merchants but carries a minimum order per merchant. Uber Eats’ $9.99 program gives customers free delivery and 5 percent off orders over $15 for all merchants in the subscriber’s city.
The membership model is clearly a savvy way to normalize the revenue for the delivery providers and makes sense for customers who order frequently. How many sign up is something to watch for in the next earnings call and would be a key metric to watch for brand loyalty; which every company is fighting as the delivery market-share battle continues.