Evolving Offer Strategies on Third-Party Food Delivery Platforms
In a highly competitive space, like delivery through third-party platforms, it is difficult to convert potential customers where they are spoiled for choice. To reel these customers in, merchants often bet on discounts or offers to be the deciding factor. As their advertising strategies evolve, we’ve seen growth in the adoption of discounts and promotions on third party platforms. In December 2021, about 1/3rd of stores offered a discount at some point during the month.
Merchants Offering Discounts
United States, DoorDash, May - December 2021
YipitData wanted to take a look at what kind of discounts merchants are offering. To evaluate and analyze their offer strategies, the offers are broadly categorized into one of three of the most common types observed:
$ off : eg. $3 off orders over $20
% off : eg. 20% off your order
Delivery discount : eg. Free delivery
To take a closer look at this, let’s dive into some of the top offer/promotion providers on DoorDash: McDonald’s, Burger King, and Wendy’s.
Offers by Discount Type - Burgers
United States, DoorDash, May - December 2021
It is clear that the burger brands are doing a lot of experimenting with their offer strategies. The occurrence of “‘$ off” offers has declined toward the end of the year while “% off” offers are more frequently provided. Among this competitive set, McDonald’s has been the leading provider of all offers, including those “% off” offers to customers.
“% off” offers by Merchant - Burgers
United States, DoorDash, Aug - December 2021
In fact, McDonald’s often provides more creative offers that don’t squarely fall within these typical categories. One example would be their GO4GOLD offer during the Olympics this summer where they provided free 6pc Chicken nuggets on orders over $15.
While discounts/offers are only one contributing factor to the consumer’s final decision (menu items, marketing, etc.), offers can be a key driver to influence customers. As a result, merchants will likely continue to use them and iterate on their tactics as marketing strategies evolve on third-party platforms.
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For more on third-party food delivery platform dynamics, visit yipitdata.com to connect with our team of analysts. YipitData is the premier provider of alternative data to investment funds and corporations.
