DoorDash Enhances Advertising Opportunities for Restaurants, CPG Brands

Through DoorDash’s new advertising capabilities, restaurants and CPG brands can easily reach their 20 million monthly users while generating additional revenue for the delivery platform. In addition to existing banner placements and special offers, sponsored ads can help restaurants appear at the top of search results.

According to the blog post, early testing of ads sponsored by small restaurant chains Pizza My Heart and Uncle Julio led to an increase in orders and volumes. The new offerings use a pay-per-acquisition model rather than a pay-per-click model, demonstrating the importance of performance marketing as advertisers look to increase the effectiveness of their advertising money.

In addition to sponsored offerings, DoorDash offers advertising opportunities for CPG brands to leverage their expansion into grocery, convenience, alcohol, pets, and other categories.

“Pepsi has been testing and running promotions and banners for our partner teams in the restaurant for several months and we look forward to expanding our reach in the convenience and food industries to enable more commerce opportunities,” said Alison Dempsey, PepsiCo Chief, and Customer – marketing said in the blog post.

As it appears to remain competitive in in-app delivery, DoorDash also needs to be careful not to block its platform with too many ads that can scare off consumers. This limits sponsored restaurant ads to one ad at the top of search results and two ads in other areas, reports the Wall Street Journal.

By improving its advertising offerings, DoorDash seeks to engage a variety of advertisers on its platform while the company explores other revenue streams. While revenue grew 83% to $1.24 billion in the last quarter, growth slowed during the pandemic of previous quarters. DoorDash and other platforms have also experimented with fee limits set by various cities to protect small businesses during the health crisis.

DoorDash’s move comes more than a year after rival Uber Eats launched sponsored cost-per-click deals on its app. Food and convenience competitors such as Walmart and CVS have also expanded their advertising capabilities using their large pools of consumer data.