Starbucks will partner with Grubhub to deliver coffees and other customized beverages in select U.S. markets starting this month. Coffee delivery from Starbucks is its latest attempt to widen its reach as inflation-hit customers are increasingly opting to eat at home.

Starbucks coffee delivery

Starbucks delivery has been available on DoorDash in the U.S. since last year. It also has tie-ups with Uber Eats and Postmates, the food delivery arms of Uber.

Starbucks said it witnessed double-digit growth in the U.S. delivery business this past quarter.

Delivery by Starbucks will be accessible through the Grubhub mobile app, available on iOS and Android devices, and Grubhub.com. Starbucks and Grubhub partnership is to ensure delivery is as quick as possible so customers can enjoy their Starbucks beverages and food promptly. Customers can track their orders through Grubhub from preparation to drop off.

To ensure quality and assist with delivery, Starbucks developed multiple packaging solutions, including two-cup to-go trays and improved shopper bags, that are used for delivery orders and enable delivery drivers to easily transport multiple beverages at a time.

Starbucks Grubhub partnership

The coffee chain Starbuck’s products will be home-delivered in Pennsylvania, Colorado and Illinois at first, and then expand across the country by August, it said on Thursday.

“Our new partnership with Grubhub will help fuel this growth by increasing availability of Starbucks products to Grubhub’s tens of millions of customers,” Meg Mathes, vice president of digital experiences at Starbucks, said in a statement.

Starbucks sales forecast

Starbucks in April had cut its annual sales forecast. The decline in sales forecast was after reporting a fall in same-store sales for the first time in nearly three years. This was as it struggled with weak demand in the U.S. and China. China and U.S. are Starbucsks two biggest markets.

The company said with the monthly membership program of Grubhub, customers would be able to buy its drinks for zero delivery charge, lower service fees and exclusive offers.

The delivery will be accessible through Grubhub’s mobile app and official website.

Grubhub delivery

A part of Just Eat Takeaway.com NV, Grubhub also has delivery partnerships with restaurant and fast-food chains such as McDonald’s and Wendy’s.

Grubhub has even tied up with grocery delivery platforms such as Gopuff and Buyk. Also with companies like Starship Technologies to bring robot delivery services to college campuses.

Last week, Amazon added Grubhub to its website and app. This will help its customers in the U.S. order directly from the food delivery platform.

Starbucks stock update

Starbucks stock closed at $81.47 +0.31 on Thursday.

The post Starbucks Partners with Grubhub to Deliver Coffee to Your Door appeared first on Industry Leaders Magazine.

Hungry New Yorkers took Grubhub up on its offer for a free lunch, resulting in utter chaos as the website and app crashed due to unprecedented order volumes. The Grubhub promo code “FREELUNCH” gave people $15 off their order within a three-hour window between 11 am and 2 pm. The Grubhub promo code was applicable to all five New York City boroughs and surrounding areas.

The Grubhub free meal offer eventually resulted in hangry customers calling up their customer services as orders were delayed by hours or canceled outright. Christopher Krautler, the company’s director of consumer public relations admitted that the influx of orders went beyond what was anticipated.

The GrubHub marketing campaign was held after the delivery company conducted a survey of full-time NY workers, out of which 81% admitted that they value lunch time but find it difficult to take a break.

The Grubhub marketing disaster is a lesson in what not to do. Sure, even negative publicity is publicity. But sometimes, it leaves a bad taste in one’s mouth that is difficult to shake off. Or in this case, no taste, just hunger pangs.

Users took to Twitter to air their grievances with memes and snarky comments calling out the company for its unpreparedness.

1. Research and Testing – Unpreparedness

Krautler admitted that they were shocked by the response. He mentioned that the company has plans to look into why this offer received such an overwhelming response while similar offers in the past have been unable to drum up business on such a large scale.. The Grubhub marketing campaign got things right in terms of rolling out a limited period offer and playing on people’s fear of missing out. Although they recognized the need for a break and tailored a campaign designed to meet it, they missed out on the next most important step. They failed to research expected responses and test whether their processes are capable of handling such large volumes. The app and site crashing within minutes shows their lack of preparation.

2. Offering Proper Support to Partners

Many New Yorkers complained that restaurants turned off the delivery option as soon as the promo became effective. While it is understood that they wanted to avoid the onslaught of customers, it is always important to keep partners in the loop and to offer the required support. Many restaurants in the city took a pause on new orders or simply “closed” for the day. Some of the places were forced to adopt these measures as the Grubhub free meal promo made things extremely stressful for its workers. A Twitter user with the handle @arneespeaks posted “Grubhub not giving restaurants a heads up to be prepared for the surge in demand is gross. The restaurant called me super apologetic saying that they’re essentially out of food because they had no clue this was happening.”

3. Logistics

In case of any promotional event, it is important to ensure that logistics are in place and running smoothly. An employee from a Mexican restaurant told Buzzfeed News that as they were not aware of the promo, they were understaffed and the restaurant’s delivery driver was unable to keep up with the demand. Eventually, she booked an Uber to hand deliver 11 orders herself. Grubhub later revealed that the app was averaging around 6,000 orders per minute. Although Grubhub has previously made it to the top of the best food delivery app list, Tuesday’s fiasco will not be forgotten soon.

 Grubhub delivery drivers mentioned that it was a “crazy lunch day” as they dashed around NY trying to fulfill orders. A frustrated Manhattan resident voiced his displeasure at the absolute lack of preparedness and stated that he hopes the delivery company gets pulled up for such a thoughtless execution. The Grubhub marketing disaster shows us that even if we have the best of intentions, execution is what matters the most.

The post Grubhub Marketing: A Harsh Lesson in Disaster Management appeared first on Industry Leaders Magazine.

Yum Brands, the fast-food corporation that owns KFC, Taco Bells, and Pizza Hut has sued Grubhub, the delivery provider, for reneging on a two-year-old agreement on rates.

Yum says that Grubhub is asking for an exorbitantly high price for delivering Taco Bell and KFC food to customers. The company has increased its prices by nearly 40 percent, which the customers would have to pay.

The lawsuit, filed in a New York court says that Grubhub reneged on a mutual service agreement “without warning or justification”. The agreement between the two also came with a termination fee clause, which has not been honored, according to Yum.

“Grubhub’s improper efforts to rid itself of a deal it no longer wanted and to line, its pockets will cause enormous harm to consumers at a time when they can least afford it,” Yum Brands argued in its complaint.

Grubhub has denied the allegations. “We vigorously deny the allegations in the complaint,” the company said in a statement. “It is unfortunate that Yum has taken this step and we are very sorry about the situation Yum franchisees are in with millions of dollars at risk, especially in the midst of this challenging environment.

“We’re happy to work with Yum to resolve our contract dispute, but we intend to ensure that Grubhub and its stakeholders are protected against Yum’s breach of the exclusivity provisions of the agreement.”
The lawsuit follows the recent announcement that the delivery provider Grubhub has been sold to the Amsterdam-based delivery provider Just Eat Takeaway in a $7.3 billion deal.

Earlier in 2018, Yum had bought a 3 percent stake in Grubhub for $200 million in 2018 and chalked out a Master Service Agreement for a concessional rate and preferable services for delivery of KFC and Taco Bell food. The agreement had a $50 million termination fee, which acquires significance after Grubhub’s deal with Just Eat.

Additionally, Pizza Hut CEO Artie Starrs was made a director of Grubhub. Under the deal, Grubhub received some exclusive marketing and advertising rights with Taco Bell and KFC. Taco Bell and KFC promoted Grubhub deliveries in all the franchises since the start of the agreement, Yum said.

At the heart of the dispute between Yum and Grubhub is the use of other delivery services such as Postmate and UberEats, which Yum says it is perfectly within its rights to do so and the pandemic situation in the US required additional such services to be used. “The pandemic increased the importance, for consumers and small-business restaurant owners alike, of reliable and accessible delivery across every part of the country,” Yum explained.

Grubhub CEO Matt Maloney sent an email to Yum Brands saying that Yum breached the agreement by working with competing delivery providers. And under the circumstances the various requirements under the deal no longer were relevant.

The letter laid out news fee terms that included order processing fees of 3.05 percent plus 30 cents per transaction, and a 17 percent surcharge on consumers on their orders.

Another letter was sent to all KFC and Taco Bell operator saying “all fees would be paid by the diner.”
Before the sales agreement with the Dutch Just Eat, Grubhub was in talks with Uber Eats for a deal.

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