DoorDash’s Horrible Tipping Scandal and Opportunities for Competing Brands – The Buyer’s Journey 88

DoorDash’s horrible tipping scandal came to light and competing fast food delivery brands were quick to respond. We discuss this and more in today’s show.

What Happened

DoorDash has been subsidizing their delivery worker’s base pay using tips. This was reported in The New York Times by reporter Andy Newman, who used the app to test out being a delivery worker for the day. While this practice isn’t uncommon in the restaurant business, the news did upset many people, including myself.

Here’s how it works. Tom is a delivery driver. Adam is a customer ordering food. For delivering Adam’s order, Tom will make $6. Adam decides to leave a $3 tip. Adam assumes Tom keeps the $3 on top of what Tom receives as payment for the delivery by DoorDash. That is not the case. DoorDash actually takes the $3 tip and subsidizes their payment to Tom using this tip. DoorDash now only pays Tom $3 plus the $3 tip making up the rest of the payment. Tom will only make $6 instead of $9.

Competition Swoops In

Uber Eats and Postmates were quick to take advantage of this controversy. Each company sent out emails to their user base specifying how tips are given to their drivers. For each, 100% of tips go to drivers. Here’s a look at what those emails looked like via AdAge:

Emails Sent From Uber Eats and Postmates Users Following Doordash's horrible tipping scandal

A Postmates spokesperson explained to AdAge why they sent their email following the scandal. “Over the last few days, there has been a lot of confusion about how third-party delivery companies handle tips, so we thought it was important to remind our customers that 100% of their tips are always passed along to the courier,” a Postmates spokesperson wrote in an emailed statement to AdAge. “We pride ourselves on being transparent, so we never want our customers to question where their tips are going.”

Uber CEO Daniel Danker took to Twitter to clarify things, too.

Shortly after the article was written, DoorDash chose to change its tipping policy. Now all workers will get 100% of their tips. Unfortunately for DoorDash, there might also be a class-action lawsuit in the works.

What’s Marketing Got To Do With This?

As a marketer, you should always be looking for opportunities to talk about how great your brand is. Normally, we’re always focused on the purple cow. However, there are a lot of times, especially with social media, where organic opportunities arise. Postmates and Uber Eats could never have guessed the DoorDash story would have so much traction. But when it did, and when consumers were worried about their service, Postmates and Uber Eats jumped to the call. Now, users of those apps can feel better knowing their drivers are getting compensation they deserve, and they get some nice transparency.

Not all opportunities have to focus on taking advantage of a bad story about a competitor. Taking advantage of internet memes and trends can be a boon, too. Just check out Kool-Aid’s Twitter account.

Check out our next episode where we’ll discuss how many email communications from brands are too many. 

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