How Does Doordash Business Model Ascertain The Way Ahead For Food Delivery Apps?

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Should the Doordash Business Model and Revenue Structure decide the modalities of the upcoming food delivery apps, know how we unlock the construct!

Doordash is an on-demand restaurant food delivery app. It is named after dashers – the delivery guys who work in flexible shifts and get good tips. It was founded by four Stanford students and raised $60 million with a reported valuation of nearly $600 million. DoorDash spent 18 months developing its delivery service in Silicon Valley before entering the crowded San Francisco market. It can now be used to order food in Boston, Brooklyn, Chicago, Los Angeles and Washington.

As Investors Intrigue into Food Delivery Business

Investors have been feeding frenzy over food-delivery app start-ups in the past decade. But the external turbulence due to the outbreak of the COVID-19 pandemic has put the global markets in a precarious state. This has affected stocks in publically traded food delivery platforms like Postmates, Grubhub, Zomato, Swiggy; thus turning the tables for the restaurant delivery partners who confidentially filed to go public in early 2020.

Shares for startup food delivery service have been trading below its initial pricing. Investors have been spooked with tapering off the funding with subtle market issues. And as it is preset beforehand that the capital accrues to the winners in the markets that people think are growing. Even as the investors invest in every funding round of the series, they are pretty much sure that a company, or let’s say a food delivery startup wouldn’t just get the funding for the sake that there is a lot of money floating in the system but as the market recovers these international food delivery app companies have to beware of the competitors as they may come from behind and win.

How Does DoorDash Food Delivery Work?

Combining the basic functionality of an on-demand food delivery app, DoorDash has additional scaled its merchant engineering teams to meet new challenges. It has a new prediction service that applies its models to the data and serves various microservices that rely on data-driven insights. It empowers and personalizes the customer experience by implementing machine learning models on massive amounts of data to quickly generate large-scale predictions. This essentially curates search results, assigns dashers, recognizes fraud and more.

Their team has also introduced CUPAC (Control Using Predictions As Covariates) to reduce extraneous noise in online controlled experiments, thereby accelerating DoorDash’s experimental velocity. The rapid experimentation is essential to helping DoorDash’s push key performance metrics forward. Whether it is about improving their store feed ranking, optimizing the efficiency of their logistics system, or evaluating new marketing campaigns, it’s critical for DoorDash to maintain a robust experimentation methodology to ensure that the new releases improve business metrics in production.

How Does DoorDash Make Money?

Doordash has been taking chances to become the delivery ducky as it rose down funding round after investors lowered the shared price followed by raising the market share as its shares surpassed those of Postmates and Uber Eats in the U.S. DoorDash now has an extra $600 million in firepower to continue gaining market share in the U.S. and Canada, the only two markets in which it operates. As the investors predict, the money with Doordash will not be going into fuelling a price war with the rivals, rather the focus is on the market expansion and their next billion-dollar project – Doordash Drive which will be at par with businesses like Walmart. Considering the fact that their growth hasn’t come through the discounts, and this being the premier reason why the investors have continued approaching them in an excessive mode (2018 through the 2020).

Basic Food Delivery App Features

  • SignUp/Login
  • Searching across restaurants
  • Searching across food categories
  • Selecting a food item, modifying quantity, adding to cart, making payment
  • Push Notifications in On-Demand Food Ordering App
  • Discount/Rewards, Cashback and Loyalty Programs
  • Real-Time GPS Tracking of Food Delivery
  • Easy Payment Options (Credit Card/Debit Card/Net Banking/Pay Later/Cash on Delivery)
  • Social Media Integration (attaching Facebook, Instagram, Google Account Login details)
  • Reviews & Ratings
  • Easy Checkout

Doordash Food Delivery App Features

The features in a food delivery app depend upon the number of the modules:

  1. For the customer side of the app
  2. For the admin panel
  3. For the courier/delivery person app

1. The Customer App – Features

  • Registration And Creating A Profile
  • Search And Find Food Easily
  • Checking The Restaurant Profile
  • Add The Food To Cart
  • Schedule the Orders
  • Delivery Person’s Contact Info
  • Make It Easy to Pay
  • Order History
  • Track The Food, Real-Time
  • Rating And Reviewing The Food

Additional Features

  • Offers, Promos Coupons And Many More
  • Push Notifications

2. The Admin Panel

  • Registration & Profile Management
  • Order Assigning
  • Dashboard
  • Managing The Content
  • Managing The Orders

Additional Features 

  • Accounts & Management
  • Sending Out Push Notifications
  • Loyalty Campaign, Offers, And Deals
  • The Analytics

2. The Courier App

  • Registering And Editing The Profile Once Again
  • Managing Orders
  • Navigation And GPS Tracking
  • Status Update
  • Wallet Feature
  • Delivery History

Doordash Business Model Includes

1. Key Partners

  • Restaurants
  • Delivery Personnel Dashers

2. Key Activities

  • Taking Online Orders
  • Hiring Delivery Persons
  • Managing Logistics to Process Orders
  • Managing Driver Payouts
  • Creating and Managing Technological Infrastructures
  • Processing Transactions

3. Key Resources

  • Technology Platforms
  • Restaurant Partnerships

4. Value Proposition

  • Customers
  • Can order meals online
  • 24*7 customer service
  • Can browse menus of various restaurants
  • Can track their order
  • Better Pricing and Efficiency

5. Drivers

  • Extended Customer Base
  • Get an online platform to serve its customers
  • Easy, cheap and a fast way of delivering orders
  • Empowerment of small restaurant owners

6. Delivery Persons

  • Earn good money
  • Flexible Time Slots
  • Delivery Guys Even Receive Tips From Users

7. Customer Relationships

  • Social Media
  • 24*7 Customer Support

8. Channels

  • Website
  • Mobile App for Android
  • Mobile App for iOS

9. Customer Segments

  • Users:
  • People who want food to be delivered at their doorstep
  • People who want to eat from outside
  • People who don’t want to cook
  • Restaurants:
  • Which do not have delivery guys
  • Those who do not take online orders
  • Who wants to make use of DoorDash audience

10. Factors to consider: How much does DoorDash App Cost?

  • Technological setup and running costs
  • Salaries to permanent employees
  • Payments to delivery persons and fuel expenditures

11. Revenue Streams

  • Commission out of each order
  • Some marketing and branding programmes for restaurants

Doordash Revenue Model

Doordash serves by delivering from restaurants to customer’s doorstep and for each delivery they receive a 20% commission from restaurants. To be on top of the restaurant’s list for a limited time, for popping up in advanced search, DoorDash charges a certain commission. DoorDash also hires its own drivers who are popularly known as Dashers. The delivery rate however depends upon the distance of travel and how far will a dasher delivers. DoorDash’s tie-ups with the restaurants in consideration, but the average delivery fee that they charge is $5 – $8 / order.

Technology Stack to Create Food Delivery App Like DoorDash

  • For Application and Data: JavaScript, Python, nginx, React, CloudFlare, Java, Redis, TypeScript, Django, AmazonCloudFront, Redux, AWS Lambda, Swift, Kotlin, Retool
  • Utilities: Google Analytics, Stripe, Twilio SendGrid, Optimizely, Segment
  • DevOps: GitHub, Docker, Jenkins, Kubernetes, Webpack, NewRelic, Yarn, Sentry
  • Business Tools: Jira, GSuite, AdRoll

Conclusive

Customers do have options scattered in front of them when it comes to ordering food online, but they truly know what really makes them feel happy. As we focus on much loved all-time-favourite On-Demand Food Delivery Apps, our development experts take a leap over the best technologies in the market and seamlessly integrate customer’s choices with the best budget and timeline options to devise top on-demand food delivery apps like Doordash. Discuss your app idea with us.

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About Author

Manish Jain

Manish Jain is the co-founder and Managing Director at Konstant Infosolutions. He is responsible for the overall operations of the company and has played a major role in bringing Konstant up from its humble beginnings and, with his immense energy and drive, transforming it into a globally trusted name in IT solutions.

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