DoorDash reported that the addition of new retail verticals on its app appeals to consumers who are cross-shopping across categories. Half of DoorDash’s new customers start outside of restaurants, beginning instead with convenience, grocery, & alcohol delivery orders. Management further reported that “convenience begets more convenience” and that food is the most resilient & highest frequency category.
Key Commentary
- Tens of millions of Dashers have come to the DoorDash platform because they don’t earn enough from full-time jobs according to management. The company is providing Dashers with a bridge between their regular income & their cost of living.
- 90% of Dashers work less than 10 hours per week (3-4 hours/week on average) and 80%+ have full-time jobs.
- NYC set a minimum salary of $17.96/hour for restaurant delivery drivers, with this minimum increasing on April 1st of each year. DoorDash believes that this is bad policy (along with a similar requirement in Seattle) which will drive unintended consequences.
Sales
- U.S. marketplace growth in total orders accelerated in 3Q23 in both its restaurant & non-restaurant categories.
- DoorDash is one of the most downloaded consumer apps on iTunes & its monthly active users grew at a double-digit rate in September.
- With under double-digit percent restaurant industry penetration, DoorDash believes there is a long runway left in this category. Management reported no noticeable impacts in its restaurant business relating to the new weight loss drugs.
- The company was able to drive growth by leveraging its preexisting network of Dashers to address demand for small grocery delivery orders when, for example, consumers run out of eggs or milk mid-week. This also helped to introduce the company to new grocers.
- The company has over 100,000 stores on its platform that are outside restaurants.
