Doordash Marketing Strategy: A Journey of Growth

Are you a college student or an office worker who prefers to get your food delivered right where you are??‍??‍?

If yes, then do you know about this company that started catering on-demand deliveries of food across a university campus? In 2020, it contributed to 45% of all food deliveries. ?

Today the company aims to become a star in the logistics game. Let’s find out more about their aspirations!✅️

About DoorDash

DoorDash is a tech firm based in San Francisco that connects nearby customers and local food businesses through delivery services facilitated by freelance workers.

DoorDash operates in over 7,000 cities across the United States, Canada, Australia, Japan, and Germany. ?

In the convenience economy of our modern times, DoorDash empowers local businesses to meet consumer demands and flourish. 

DoorDash strives to bring communities closer together by constructing an efficient logistical network for local commerce.?

DoorDash’s History in Short

DoorDash is the brainchild of Tony Xu, Andy Fang, Stanley Tang, and Evan Moore. The journey of DoorDash began in 2012 at a small macaroon store in Palo Alto, California.

While building technology for small businesses, the four Stanford students realized the pain point of deliveries through interviews with over 200 business owners in the Bay area.

The friends addressed this widespread need for deliveries by creating an app initially called Palo Alto Delivery in 2013. Its name was later changed into what we know today as DoorDash. 

The app started getting delivery demands within the first 30 minutes of its creation. Initially, the team was delivering food throughout the Stanford campus. With time, it began working beyond campus since families and office workers in the area faced similar issues. DoorDash then experimented with AI and collaborated with Walmart. 

The DoorDash team is focused on its vision to become the local, on-demand FedEx. After all, the idea was to build a logistics company that caters to on-demand deliveries. 

The company not only empowers small businesses but also offers employment and provides affordable convenience. DoorDash continues to enter new cities with its aim to become the first real-time logistics company in the world.?

Marketing strategies of DoorDash

Segmentation | Dashers, Restaurants, and Customers

The drivers who manage deliveries for DoorDash are called Dashers. These are the people who want to be in charge of choosing the place, the time of their work, and consequently, the amount they would earn. Any person who has a means of transportation available along with a smartphone can become a Dasher. ?

The company targets restaurants that lack delivery services of their own. Such restaurants are usually willing to expand their customer reach. 

When it comes to customers, DoorDash targets people who, due to their busy schedules, lack the time to cook for themselves. Such people are generally interested in having high-quality food conveniently delivered to their homes. ?‍??‍?

QUICK FACT?

As of 2021, the company had partnered with around 2,000,000 Dashers, out of which a strong 55% participation was from women drivers. 

Identifying Gaps in The Market 

The food delivery market is neither new nor devoid of competitors. DoorDash was not the first one to enter this area of business, so it had to find innovative ways to thrive.

While the competitors were concentrated on cities, DoorDash decided to focus on delivering to the American suburbia. Aiming to break into the market, DoorDash shifted its focus to areas where the competition was low. 

Moreover, the competitors of DoorDash did not focus much on sharing data that could be used in identifying consumer habits. DoorDash decided to let restaurants gain insights into their consumers’ habits. It also helped restaurant owners in figuring out ways to improve customer experience, which would increase sales.

QUICK FACT?

In 2019, DoorDash reported a data breach that caused around 4.9 million of its customers, Dashers, and merchants to have their information stolen.

Ensuring Quality ?

When we talk about market gaps, DoorDash had to first determine which aspect of food delivery to focus on. For example, Uber Eats concentrated on speed, while Seamless focused on providing the best prices.

So DoorDash narrowed down its focus on ensuring quality delivery. For this purpose, the company had to ensure that the restaurants and the Dashers had good ratings before tying up with them. All of this was done with the aim of ensuring that the customers receive quality food safely.

QUICK FACT ?

In 2018, DoorDash surpassed Uber Eats to become the second highest in food delivery sales in the US. 

Technological Improvement

DoorDash offers mobile applications with variants for both Android and iOS. The apps are designed in such a way as to make them easy to use. Their apps also have features that provide insights into consumer habits.

For example, customers can have a list of suggestions based on their previous orders. If a customer wants to schedule delivery for later, they can easily do so and even access the tracking information of their order live. 

The company is driven to enhance its customer service by advancing its service’s technical aspects, including its mobile apps. The quality of customer experience directly impacts their willingness to make purchases. 

Customer-Centric

DoorDash has realized that the happiness of its customers is the key to enhancing the company’s revenue. That is the reason for the company’s continuous efforts to ensure a positive experience for its customers. 

DoorDash has built quite a strong social media presence, especially on Twitter. There is a separate account for overseeing customer support where customers can easily reach out to them with their issues. 

The company also has 24/7 customer support available on its website. They are responsive to any issues their customers face. 

Adapting to World Events

During the Covid-19 pandemic, many restaurants found their worst nightmares turning into reality with work declining and even shutting down in the worst-case scenario. That was the time when DoorDash truly became a savior for many such businesses. 

DoorDash strictly ensured the safety of its employees as well as customers during the pandemic. All the Dashers were equipped with gloves and sanitizers, while contactless deliveries were offered to customers to limit face-to-face interactions. ??

In case a Dasher got infected, the company offered two weeks’ pay while they rested and stayed quarantined. 

To ease the tough times for local businesses, DoorDash allowed restaurants to not pay the company any commission fee for the first 30 days after they signed up.

Top Products of DoorDash 

Marketplace 

DoorDash Marketplace helps local businesses be discovered by more customers who enjoy the convenience of online ordering and delivery. 

Restaurants registered in the plus or premium partnership package receive the benefit of being marketed to subscribers with a $0 delivery charge and lower service fees. 

DoorDash also offers the option of pick-up service, usually preferred by new or first-time customers. Restaurants have to pay a lower commission for pick-up orders.

Storefront 

Through Storefront, DoorDash offers restaurants the chance to make their websites profitable. Restaurants can add their Storefront link directly on their website, social media, and even Google Business Profile.

This service allows restaurants to skip paying any commission fee while availing of pick-ups as well as delivery services of Dashers. Storefront is, in fact, included in all partnership plans.

On-Demand Delivery 

On-demand delivery lets restaurants receive orders directly from customers who pay a flat delivery fee on their orders. 

The restaurants then connect online with the DoorDash delivery logistics, and a Dasher is automatically dispatched. 

Sponsored Listings 

DoorDash offers to display ads at prime spots on their platform, like the homepage or the top of the relevant search results. Restaurants have to pay only for orders placed through these ads. 

Brand Licensing 

DoorDash helps businesses or even individuals in selling a popular brand’s menu from the comfort of their own kitchen through brand licensing. DoorDash manages the staff training, the marketing aspect, and the store page. 

Promotions ?

DoorDash claims that using promotions can increase a merchant’s sales by an average of 25%. Promotions work by offering discounts, free delivery, or a free item to customers. This strategy attracts new customers and brings back the lapsed ones.

Alcohol ?

DoorDash offers speedy delivery services for liquor with an average delivery time of 35 minutes. While ensuring compliance with local laws related to alcohol delivery, DoorDash helps alcohol stores and restaurants that serve alcohol to satisfy their customers with same-day delivery or even pick-up. 

Capital ?

DoorDash has collaborated with Parafin, a business financing provider, to offer easy access to capital to eligible merchants. Funds are allocated within 1-2 business days with no hidden charges, recurring interest, or prepayment penalty.

DoorDash Marketing Mix 4P Analysis

Product 

The journey of DoorDash started as a food delivery platform. It was created to aid customers in receiving their orders from local restaurants from the comfort of their homes.

The company still holds its original purpose but, at the same time, has expanded and evolved. 

In 2021, the company came up with ‘DoubleDash.’ It was based on the idea of allowing users to shop across multiple grocery, convenience, and liquor stores.

Having done the shopping, consumers could ask the Dashers to pick up the items from multiple locations without an extra charge.  

Place

The operations of DoorDash began at a local macaroon store in Palo Alto. The business soon picked up the pace and expanded to all 50 states in the United States. Then there was no turning back. 

Doordash penetrated the markets of Canada, Japan, and Australia. In recent times, the company also built a presence in Europe by offering its services in Germany. ?

It is also speculated that the company plans on expanding its reach to the markets of Denmark and Sweden.

In fact, DoorDash finalized an $8 billion deal agreeing to buy the Finnish food delivery service, Wolt. Business expansion is the key to having the upper hand in a saturated market.

Price

Customers can avail of subscription-based services offered by DoorDash at $9.99 a month. After that, they do not have to pay any delivery charges on orders above $12.

Without a subscription, customers have to pay a delivery charge ranging from $5 to $8 on each order, depending on the distance and the demand for the service at that time. 

DoorDash allows restaurants to advertise on its mobile application. The company also receives a commission of around 20% of each order from the restaurants that tie up with it. In return, the restaurants gain the attention of a larger customer pool.?

Promotion

Word of mouth is a key marketing channel for DoorDash. Customers tend to talk positively when the service is at par with their expectations. This benefits the company as more customers begin to try out their services based on positive responses.  

DoorDash also invests in traditional means of promotion through TV, online, and print advertising. The company occasionally teams up with restaurants to create exciting deals for its customers. Such a strategy is advantageous to both the customers and the local businesses. 

DoorDash’s Top Campaigns

A Neighborhood of Good in Every Order, 2022 

This campaign, launched in the US, highlights the importance of each order in the empowerment of a community. It showcases 15 seconds slots for orders that help a pharmacy stay open, a restaurant create jobs, and a Dasher earn some extra cash.

We Door Dash, 2021

We DoorDash was the first local campaign launched by the company in Australia, having entered the Australian market in 2019. It presented DoorDash as a convenience that Australians can rely on for the delivery of a wide range of items ranging from coffee to groceries.

Open for Delivery, 2020

This campaign encouraged consumers to help local restaurants survive the brutality of the COVID-19 pandemic by ordering deliveries. This was one of the most popular DoorDash campaigns ever.

Delicious at Your Door, 2019 ?

This was the first national TV ad campaign launched by DoorDash. It showcases the company’s mobile application featuring some of its most recognizable partners like Wendy’s, IHOP, The Cheesecake Factory, etc.

Pop Up, 2019

Another national campaign launched by DoorDash in collaboration with Brand New School is built around the literal pop-up concept.

We Get Groceries 2023?

This was the first grocery campaign by DoorDash launched during the 2023 Super Bowl. On-demand grocery services were launched by the company in 2020 amidst the worldwide pandemic.

Key Takeaways
– DoorDash evolved by identifying market gaps and offering responsive solutions. ?
– It embraced flexibility to deal with changing times. ?
– The company was open to expanding not just its reach but also its services. ✅️

FAQs

What marketing channels does DoorDash utilize?

DoorDash makes use of word-of-mouth marketing through positive customer reviews and feedback. It also invests in traditional advertising by means of TV, internet, and print media. It launches interactive ad campaigns built around well-thought-out themes to gain viewers’ attention. 

How does DoorDash manage its competitors?

DoorDash has focused immensely on the importance of data. It provides restaurants an insight into customer habits. And to customers, it offers suggestions lists, a rather fair rating scale, etc. 

DoorDash has also expanded its business with the need of the times to deliver groceries and alcohol. It also engages in financing services, promotional activities, and so on.

What is the target audience for DoorDash?

DoorDash targets restaurants and stores which are looking to expand their customer base and do not have a delivery service in place.

In terms of consumers, the company is focused on attracting people who can’t cook for themselves for one reason or the other and would prefer to have good quality food, groceries, etc., delivered to their doorsteps. 

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