Grubhub gets a major new partner in fast-food delivery war
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Grubhub gets a major new partner in fast-food delivery war

In the fast food world, there are a handful of names that tower over their peers like giants. One such name is McDonald’s – a brand that casts a shadow over anyone else who can cook a burger at speed. Now, food order and delivery service Grubhub has gained a major advantage in the battle for fast-food supremacy by partnering with Ronald and his golden arches. And that’s bad news for its competitors.

The market reacted positively to last week’s news, sending Grubhub’s share price up

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Source: Yahoo Finance

Of course, Grubhub partnering with a company like McDonalds was always going to be bad news for rival services – but for a couple of those competitors, the news is particularly bad. Originally, McDonalds inked a deal with Uber Eats that made it the exclusive delivery partner of choice. That was back in 2017. Then, it ended Uber Eats exclusive access, adding DoorDash into the mix. Just a couple of months later, the company has added Grubhub too.

Opening up access to Grubhub plays into the platform’s favour. The new agreement will give Grubhub access in over 500 New York City and tri-state area locations – but it won’t be competing with the other two platforms on an equal basis. Research shows that customers tend to be loyal to their food order and delivery platform of choice, and Grubhub has 71% of the New York market. In other words – Grubhub looks perfectly positioned to carve out the biggest slice of a massive pie that was once previously owned by rival services. That’s quite the coup.

Disclosure
Dominion holds Grubhub in its Global Trends Ecommerce Fund.


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