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As food delivery apps struggle to make profits, Grubhub is still a staple of campus life

NewsCampus NewsAs food delivery apps struggle to make profits, Grubhub is still a staple of campus life

BY TARA LENNON
Editor-in-Chief




Food delivery apps: a common solution for the sober and drunk college student alike in need of a late night snack. 

Now a staple of college life, food delivery app use skyroted due to COVID-19 and is still staying popular in the aftermath of the pandemic. Yet, almost entirely across the board, food delivery apps continue to remain unprofitable

This simultaneously booming yet struggling industry has also infiltrated another part of life as a college student, the on-campus dining experience. 

Just a few years ago, a hungry student would walk up to the Chick-fil-A in Trabant Student Center, wait in line for a new batch of chicken sandwiches and then go pay for their food with an actual cashier. 

Now, that way of dining may seem like a lifetime ago, with Grubhub, which dominates around 18% of the food delivery app industry, completely transforming the eating experience on campus. A hungry student only needs to look at their phone to place an order of their favorite meal that they can buy with their dining points.

University Dining Services rolled out this new way of dining in the fall of 2019, though at the time, the spending of points was not exclusively limited to the Grubhub app. Students could still go up to the on-campus restaurant, pick up their food and physically pay with their ONEcard or any other form of payment. 

The concerns for safety brought about by the COVID-19 pandemic, however, moved Grubhub to the center of campus dining, with the app almost entirely facilitating the purchase of food at on-campus restaurants. Jennifer Mackiewicz, the marketing manager of Aramark, which facilitates the university’s Dining Services, said that in spring 2021 the university moved entirely to mobile ordering to keep customers safe. 

“By having Grubhub mobile ordering prior to 2020, the University of Delaware was able to quickly pivot its dining operations to adhere to safety protocols given the infrastructure was already there,” Steve Iarocci, director of client success at Grubhub, wrote in an email. 

According to Iarocci, Grubhub now works with more than 250 higher education institutions across the country. The company is also continuing to employ new technology at many of these institutions, with one of the latest being food delivery robots at five college campuses

Despite these partnerships with universities and other marketing tactics aimed towards students, like the Grubhub+ Student Membership, Grubhub still suffers from the same problems as other food delivery apps. According to a study of the food delivery app industry in winter 2021 conducted by the University of Oregon and the Oregon Consulting Group, thin margins resulting from the low rates needed to retain customers and the amount needed to pay drivers, combined with high competition across the industry, have resulted in a “flawed system” which may result in the industry’s collapse. 

In the last available quarterly earnings report from its website, Grubhub reported a net loss of $75.5 million in the first quarter of 2021, though this loss decreased $33.4 million from the loss in the first quarter of 2020. 

In terms of how the university pays Grubhub for its services provided on campus, Dining Services pays an annual service fee to Grubhub, ensuring that students do not have to pay a transaction fee on the orders placed, according to Mackiewicz. 

Though the use of the Grubhub app for dining may have not entirely quickened the dining process, with Chick-fil-A wait times rising to up to two hours at certain points of the day, some students prefer the feature of convenience that the app has added to their dining routine. 

Freshman Julianna Ashley will make sure to order her Chick-fil-A an hour in advance around 5:00 p.m., as the busier hours of the restaurant approach. 

“It is convenient because in this society, everyone is on their phones now, so I feel like it’s 10 times easier ordering on your phone than waiting in a long line,” Ashley said. 

Senior Laila Almoraisi shares Ashley’s affinity for Chick-fil-A, yet will order it whenever the desire strikes regardless of the wait time. 

Senior Kate Greco, however, checks the wait times for food on the app frequently, but still likes the convenience of ordering on the app. 

“I like having it because I can order it in advance instead of ordering it just when I get here,” Greco said. 

Whether or not Grubhub will stay a staple of campus dining as the food delivery app industry continues to struggle remains in question. But, according to Mackiewicz, the university plans to continue this partnership with Grubhub for the foreseeable future.

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