Doordash delivers ‘outsized growth’ in grocery, convenience

The delivery service provider has added non-restaurant partnerships, leading to higher year-over-year growth compared to restaurants.
Connor Perrett
  • DoorDash posted sales gains in its non-restaurant delivery category. 
  • Overall, DoorDash orders increased 27% in the first quarter compared to 2022.
  • DoorDash CEO Tony Xu said the company had a “long way to go” toward its grocery delivery business.

Doordash posted “outsized growth” in its non-restaurant categories, which include orders from grocery and convenience stores, in the first quarter of 2023. 

According to a May 4 filing with the Securities and Exchange Commission (SEC), total DoorDash orders increased to 512 million in the first quarter of 2023, up 27% from the first quarter last year. Overall, DoorDash revenue increased 40% year-over-year (YoY) to $2 billion, the filing said. 

Growth in DoorDash’s restaurant delivery business was up slightly YoY, consistent with gains achieved during the fourth quarter last year, according to the filing. Citing third-party data, DoorDash said it believed it gained market share in restaurant deliveries during the first quarter of 2023.

While restaurant growth “slightly” increased, larger results were posted in DoorDash’s non-restaurant business, which includes deliveries from grocery and convenience stores. Gains in non-restaurant categories reported “significantly higher” YoY results compared to advancements in  the restaurant category, according to the filing. 

Despite progress in the non-restaurant category, DoorDash founder and CEO Tony Xu on an May 4 earnings call with investors said grocery delivery offerings still had room to develop . For example, U.S. online grocery delivery penetration compared to online restaurant food penetration is multiple times lower.

“Because the offline experience is still superior to the online experience, which means we have a long way to go to making sure that we can make the quality of the experience perfect,” Xu said. “Meaning, you get exactly what you order that you can get it from all the places that you want to delivery from and that the prices are affordable or what you expect to pay in store. And I think there's a long way to go between where we are today and where we will be in the future.” 

DoorDash has worked to grow its non-restaurant offerings, expanding by adding grocery, convenience stores and other retailers. Earlier this year, it partnered with value grocery chain Aldi, and other grocery partnerships include Albertsons, Giant Eagle, Weis Markets, Sprouts Farmers Market, The Raley’s Companies and Southeastern Grocers. Additionally, the company’s 2023 Super Bowl advertisement focused on its role in the grocery delivery space.

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