For restaurants that use third-party online ordering services such as Grubhub, DoorDash and Caviar, forfeiting 20-35%+ of revenue from each order can be taxing on profit margins.
However, due to the current landscape, many restaurants accept this as the status quo. It doesn’t have to be. There is a solution: direct online ordering through your restaurant website.
A Brief History of Third-Party Online Ordering Platforms
Profit margins in the restaurant industry are notoriously low. In the early 2000s, vendors like GrubHub first popped up to help restaurants take advantage of hungry guests off-site. This option to accept pickup and delivery orders created a new stream of revenue for many restaurants. But for two decades, this trend has also diverted much of this revenue stream to vendors — two-thirds of every sale into a restaurant’s pocket, one-third into the vendor’s.
Restaurants have accepted this stronghold for years but it’s no longer sustainable — for vendors or for restaurants. The food delivery industry is struggling to turn a profit. Acquisitions have begun to consolidate the number of players in the market. In 2013, GrubHub merged with Seamless. Square’s Caviar was acquired by competitor Doordash in August 2019. And these changes aren’t limited to the U.S., either. UberEats India was recently acquired by local competitor Zomato.
The tech stack is shrinking. Why? These companies are under pressure to drive revenue, but restaurants have also realized that they don’t have to settle for the status quo. Today, they have choices. And they realize the time for disruption is today. Restaurants are starting to break out and use solutions that accept direct, commission-free orders on their website.
Go Direct with Online Ordering
Operators are tired of forfeiting 20-35%+ in commission fees to third-parties. In a 2020 survey, 9 in 10 restaurants found Grubhub/Seamless commission fees to be unreasonable and responded that they had a negative experience. In fact, 78% of restaurants have seen their fees increase over time. Restaurants are also frustrated with a lack of control over the guest experience. Many of their websites have “Order Now” buttons that drive guests to leave and enter their information elsewhere, away from their website. Operators have no way to measure traffic, identify that their website was the source of an order, or capture guest information to re-market later.
By promoting and marketing that you accept online orders directly through your website, it’s possible to release your business from the grips of sharing profits with third-party marketplaces. Converting repeat visitors to order through you is simple. This is the future for maximizing sales and optimizing the takeout/delivery side of your business—all while providing higher profits per order and giving you control over the guest experience. Once restaurants have set up direct online ordering through their website, the next step is getting people to order through it.
How To Drive Customers To Order Through Your Website
1. Set Up Homepage Alerts
Use your restaurant website to set up homepage alerts, prompting web visitors to order directly through your website. Alerts are a feature that captures attention and drives action on the pages you choose, through either a banner alert or an overlay alert.
2. Use Email Newsletters to Promote Direct Orders on Your Website
Consumers often receive emails from third-party online ordering platforms like Grubhub and Caviar. They typically seem to happen just before peak dining times. 72% of diners said that they like to receive emails about new menu items from restaurants that they subscribe to. Use your list of email subscribers, who are loyal to your restaurant, to promote online ordering prior to these peak dining times.
3. Promote Popular Menu Items on Social Media
Use your social media channels to promote that you now can order popular items directly on your website. Social media promotion will drive more qualified customers to your website. If they already follow you, they are more likely than others to order through your website, increasing revenue and sales.
4. Offer Promo Codes
Promo codes are an easy way to incentivize guests to order food through your website. By using any or all of the strategies above, include some sort of promotion to capture guests’ attention and yield higher results.
BentoBox Offers Native Online Ordering
70% of U.S. diners expect restaurants to offer online ordering directly on their websites. Now there is a solution to meet this expectation. Bento Ordering is a solution that allows restaurants to capture and easily manage orders for pick up and in-house delivery directly through their website. With Bento Ordering, restaurants can bypass high commission costs charged by third-party online ordering marketplaces as well as retaining complete ownership of their customer relationships and online ordering experience. Get in touch with us at getbento.com to learn more about online ordering through a BentoBox website.