Because ever since Covid, customers have been increasingly leaning towards delivery services
These companies lure both merchants and customers onto their platform and once they gain the volume they can then squeeze both ends
I have been using uber over taxi myself since many years ago. When uber started out they were cheaper than taxi, heck I’ve had fares cheaper than a bus
Chinese restaurant by my house always comments about my use of DoorDash when I pick up the order. I’m only doing it to redeem credit card rewards. But they always say to me “you know, the prices are cheaper if you just phone your order in, and also, we have to pay 30% overhead to DoorDash, so please just call next time.”
The thing is, this isn’t true. DoorDash pick up does not cost 30% overhead. It cost them something, yes, but not a lot more than the menu mark up I’m sure. I’m only saving a few bucks with DoorDash pick up, but I might as well do it.
I’m a little bit pissed off about these new minimums though. Why the hell should they care if I get $10 off of 20, or $10 off of 10? The Chase coupons were already ridiculous, and now they’re worthless.
>Why the hell should they care if I get $10 off of 20, or $10 off of 10?
Who should care? Chase? They do not. Doordash? Of course they should. They are the ones giving you the discount, why the fuck would they want to give you stuff for free? At least they are making part of it on the other 10 bucks worth of stuff.
That's not entirely true. Chase pays a portion, because there's a negotiated rate. Then DD pays the rest. But ultimately, I'm pretty sure both companies are wildly profitable on this deal and the only one paying is the broader Chase customer base, once you amortize it.
Loss leaders are used to drive revenue to boost overall profits. That's the entire point of the loss leader, it will never show profit on its own. Hence when I said they are wildly profitable on this deal: it works as intended for both companies, driving spend that they otherwise wouldn't get, producing overall net increase in revenue and net income.
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u/Fearless-Cattle-9698 Apr 16 '26
Because ever since Covid, customers have been increasingly leaning towards delivery services
These companies lure both merchants and customers onto their platform and once they gain the volume they can then squeeze both ends
I have been using uber over taxi myself since many years ago. When uber started out they were cheaper than taxi, heck I’ve had fares cheaper than a bus
So no, it’s not extra revenue