Restaurant delivery service DoorDash announced today it will begin to support the ability for customers to pay with cash for their online orders. But there’s a catch — the feature is only being rolled out to DoorDash’s white-label delivery solution for restaurants, DoorDash Drive, which allows restaurant owners to offer delivery from their own website or app while tapping into DoorDash’s courier network. The company says that, during tests, Chinese restaurants and pizza shops have been early adopters of the feature.
In fact, when enabled, nearly 20% of pizza orders in the U.S. fulfilled through its DoorDash Drive solution have been paid for using cash, the company said.
The pay-with-cash option is meant to cater to customers who aren’t necessarily comfortable sharing their payment card information online and prefer to use cash, as well as the underbanked who may not have access to online payment options. Despite the rise in e-commerce and digital payments, there’s still a sizable demographic that continues to use cash, when possible. Other tech giants and retailers in the U.S., like PayPal, Walmart and Amazon, have similarly targeted this market in years past by offering ways to shop online, then pay with cash.
Cash payments are often preferred by drivers, as well, as they’re able to go home that night with tips that can be spent immediately, rather than needing to wait for a bank transfer. Plus, DoorDash says drivers can keep the full tip amount — they don’t have to engage in any tip-sharing with the restaurant or the delivery company itself. For this reason, some customers prefer to tip in cash, too, as they know their driver will get the full tip amount — something that’s not always the case with online ordering and delivery services.
DoorDash says Dashers will be required to opt-in to begin accepting the new Cash on Delivery option but will be able to opt out at any time without that impacting their ratings. Ahead of its public debut today, 75% of DoorDash’s U.S. Dashers chose to accept cash orders and nearly 500,000 completed at least one cash delivery over the past year. The service was tested for more than a year before today’s official nationwide launch.
However, despite the interest in cash payments, DoorDash said that it’s not enabling a cash option in its own app, noting that customers expect to pay with a credit card when ordering directly from DoorDash itself.
We understand that while DoorDash Drive charges a flat delivery fee per order with no commissions, Cash on Delivery orders may have an “incremental” per-order cost.
The company also said it’s been iterating on feedback from restaurant partners, particularly pizza chains where order timeliness is key. Among the improvements, DoorDash is focused on better delivery times and accuracy and ensuring Dashers have pizza Hot Bags for their orders. (Currently, only three-quarters of pizza deliveries used pizza-specific Hot Bags, DoorDash admitted.) DoorDash added it’s working to improve communication tools for operators and drivers and giving restaurants a way to send order updates to customers via text.
The changes follow a number of other new features for DoorDash customers and drivers on its main apps, including safety features, an option to return packages, bundled orders plus an expanded partnership with Starbucks, among other things.
DoorDash is adding support for cash — but not in its main app by Sarah Perez originally published on TechCrunch
