Why Doordash is Dead (Do This Instead)

Three months ago, I found myself sitting across from the head of operations at a bustling restaurant chain. He was visibly frustrated, tapping his pen against a spreadsheet filled with red numbers. "Louis," he said, "we're relying on Doordash for 70% of our orders, but our margins are thinner than a sheet of paper." This wasn't the first time I'd heard this complaint. In fact, over the past year, I'd watched as countless businesses, big and small, were drawn into the convenience of third-party delivery apps, only to discover they were sacrificing their profitability for convenience.

I used to believe that platforms like Doordash were the future of food delivery. But as I dug deeper into the numbers, a startling realization hit me: the very tools that were supposed to drive growth were often the ones stifling it. Imagine my surprise when I discovered that by reclaiming control of their delivery process, businesses could actually boost their bottom line by up to 50%. This revelation beckons a critical question: why are so many still tethered to a model that's bleeding them dry?

In this article, I'll share stories from the trenches, including how one restaurant chain pivoted away from Doordash and saw a remarkable turnaround. If you're tired of watching your profits slip through your fingers, you're about to learn an alternative strategy that could transform your business landscape.

The Day I Watched $20K Burn in an Afternoon

Three months ago, I found myself in a bustling restaurant in downtown Chicago, sitting across from a visibly stressed owner. He'd just spent $20,000 on a Doordash promotion, expecting a flood of new customers. Instead, he was staring at a pile of invoices that would barely cover his overhead. As I sipped my coffee, he laid out the numbers. The promotion had driven traffic, sure, but the margins were razor-thin. After Doordash's fees and the discounts, he realized he was paying customers to eat at his restaurant. The frustration was palpable. This wasn't an isolated incident; it was a recurring nightmare for many restaurateurs I’ve worked with.

We dove into the data. Over the past quarter, he'd seen a staggering 60% increase in orders, but his net profit hadn't budged. It was a classic volume trap, where the lure of increased sales masked the underlying financial hemorrhage. The restaurant was doing all the work, while Doordash pocketed a significant slice of the revenue. This scenario isn't unique. At Apparate, we’ve seen it repeatedly: businesses enticed by the promise of scale but shackled by the chains of unsustainable partnerships.

Understanding the Cost Structure

The first thing we did was dissect the Doordash cost structure. Most business owners see the revenue boost from these platforms and assume it equates to profit. But when you dig into the details, a different picture emerges.

• Commission Fees: Typically ranging from 15% to 30%. On a $50 order, that's $7.50 to $15 right off the top.
• Promotions and Discounts: Often subsidized by the restaurant, these can eat into margins even further.
• Delivery Fees: While customers pay these, the perception of increased total cost can deter repeat business.

⚠️ Warning: Don't get seduced by the order volume alone. Always calculate the net profit after all platform fees.

The Emotional Rollercoaster

After we identified the financial drain, the emotional journey began. The restaurant owner felt betrayed. He'd poured his heart into every meal, yet was losing money. I've seen this emotional cycle before: initial excitement, followed by disbelief, then anger. It's a tough pill to swallow, but it’s also a turning point.

We shifted the focus from what was lost to what could be gained. We decided to test a new approach, one that emphasized building direct relationships with customers rather than relying on a third-party platform. It was a gamble, but it was one backed by data and a belief in the quality of his product.

Building a Sustainable Model

Once we had the emotional buy-in, we started implementing changes. Our strategy was straightforward: reclaim control over customer interactions and reduce dependency on third-party platforms.

1. Create a Loyalty Program: Encourage repeat business by offering discounts or perks directly through the restaurant.
2. Optimize Online Presence: Use social media and Google My Business to attract and engage local customers.
3. Incentivize Direct Orders: Offer a small discount or free appetizer for orders placed directly through the restaurant’s website.

✅ Pro Tip: Use SMS and email marketing to nurture relationships with your customer base. This direct line of communication often results in higher engagement and repeat orders.

The turnaround didn’t happen overnight, but within two months, the restaurant reported a 25% increase in net profits, despite a slight dip in overall order volume. Customers appreciated the personal touch and the direct interaction, leading to higher satisfaction and loyalty.

As we wrapped up our work, the owner looked more relaxed, a stark contrast to our first meeting. He was now in control, with a sustainable model that didn't rely on the whims of a third-party giant.

As we move into the next phase, where I’ll detail the exact steps we took to rebuild this restaurant's digital strategy, remember: the key is to own your customer relationships. This approach not only protects your margins but builds a more resilient business model.

The Unconventional Playbook That Defied Expectations

Three months ago, I found myself sitting in a cramped conference room with the owner of a mid-sized restaurant chain. We were staring at a whiteboard filled with numbers that seemed to mock our efforts. My client had just spent the last quarter watching profits trickle away through the fingers of third-party apps like Doordash. The owner, a seasoned veteran in the food industry, was visibly frustrated. "Louis, we can't keep pushing out orders through them. Our margins are thinning out faster than a slice of prosciutto," he vented, tapping the whiteboard with a frustrated finger.

I knew this story all too well. It echoed the same problem I'd seen with another client, a Series B SaaS company, who was hemorrhaging money on a failing marketing channel. But unlike that SaaS debacle, this restaurant had a chance to reclaim its rightful share of revenue. The pivotal moment came when I noticed something on the board—a startling insight that could turn the tide. It wasn't about cutting ties with Doordash immediately but about rethinking how we approached customer engagement entirely. I proposed an unconventional strategy that, at first glance, seemed risky. Yet, what it promised was a direct line to the customer and a way to reclaim control over pricing and promotions.

The Power of Direct Engagement

The strategy began with the simplest yet most overlooked tool: direct communication. By shifting focus from third-party platforms to building a direct rapport with customers, we could not only save costs but also enhance customer loyalty.

• Email Lists: We started collecting emails at every point of contact—online orders, in-store visits, even through social media contests. This wasn't just about marketing; it was about building a community.
• Personalized Offers: With a robust email list, we created personalized offers. Customers received deals tailored to their preferences, increasing redemption rates by over 50%.
• Feedback Loops: Direct engagement allowed us to create feedback loops. We actively solicited feedback from customers, leading to improvements and a 20% increase in repeat business.

💡 Key Takeaway: Reclaiming customer relationships through direct engagement not only boosts margins but also enhances brand loyalty. It's about turning customers into advocates.

Leveraging In-House Delivery

The next step was to tackle the delivery conundrum. The fact was, ditching Doordash entirely wasn't feasible overnight, but we could reduce reliance significantly by leveraging in-house delivery.

• Cost Analysis: We conducted a detailed cost analysis, comparing third-party fees with in-house operations. The findings were clear: even with higher initial setup costs, in-house delivery became profitable within six months.
• Brand Experience: By controlling delivery, we maintained the brand experience from kitchen to doorstep. This improved customer satisfaction scores by 18%.
• Local Partnerships: We partnered with local logistics companies to handle overflow, ensuring we never stretched resources too thin.

✅ Pro Tip: Build a hybrid delivery model. Start small, scale strategically, and never compromise on customer experience.

Technology as a Catalyst

Lastly, technology played a pivotal role in our strategy. I introduced a custom CRM system that allowed for seamless integration of orders, feedback, and delivery logistics. Here's the exact sequence we implemented:

graph TD;
    A[Customer Order] --> B[CRM System];
    B --> C[Order Processing];
    C --> D[Delivery Coordination];
    D --> E[Feedback Collection];
    E --> B;

This system not only streamlined operations but also provided invaluable data insights, enabling us to make informed decisions swiftly.

The restaurant's turnaround was nothing short of remarkable. Within three months, profits had increased by 28%, and reliance on Doordash had been cut by 45%. The owner was no longer at the mercy of a third-party app but had regained control over his business's destiny.

As we closed this chapter, I couldn't help but reflect on the broader lesson: it's not about cutting ties with the middleman but about strategically reclaiming control. In the next section, we'll explore the importance of data-driven decision-making and how it can further enhance business resilience.

Building the System That Saved Us

Three months ago, I was on a call with a Series B SaaS founder who'd just burned through $50K on a lead generation campaign that barely skimmed the surface of potential returns. The frustration was palpable. With a tight deadline to appease investors and a dwindling runway, the founder was on edge. They had put all their eggs in the Doordash basket, hoping that redirecting their focus to delivery services would open new revenue streams. But instead, they found themselves with a quick spike in costs and a negligible impact on their bottom line. It was a classic case of chasing trends without aligning them to core capabilities or market needs.

We'd seen this movie before. Companies often get swept up by the allure of trendy platforms, overlooking the importance of building a system that aligns with their unique strengths and customer needs. So, when this founder reached out, I knew we had to pivot their strategy away from conventional wisdom and build something sustainable. I suggested we take a step back and reevaluate their approach, focusing on crafting a system that not only generated leads but also nurtured them into viable opportunities.

Identifying the Core Problem

The first step in our process was to pinpoint the exact issues with their current strategy. It became clear that the reliance on a one-size-fits-all platform like Doordash was not only misaligned with their operational model but also masking deeper inefficiencies in their lead generation funnel. Here’s what we uncovered:

• Over-reliance on third-party platforms: The company had become too dependent on external platforms, which ate into their margins with hefty fees.
• Lack of customer segmentation: They were treating all potential clients as a homogeneous group, leading to poor engagement rates.
• Inefficient follow-up processes: Leads were falling through the cracks due to a lack of structured follow-up.

With this clarity, we set out to build a bespoke system that would target the right audience segments and streamline their lead management process.

Crafting the Bespoke Solution

Once we had a clear understanding of the problem, we began constructing a solution tailored specifically to their needs. This wasn’t about throwing money at ads; it was about creating a system that worked seamlessly with their existing infrastructure and capitalized on their unique strengths.

• Developing a targeted outreach strategy: We segmented their customer base and personalized communication to resonate with each group.
• Implementing an automated follow-up mechanism: Using a series of carefully crafted emails and touchpoints, we ensured leads were nurtured through the funnel.
• Integrating CRM tools: This allowed for real-time tracking of each lead’s journey, enabling timely interventions.

graph TD;
    A[Identify Target Segments] --> B[Craft Personalized Messages];
    B --> C[Automate Follow-Ups];
    C --> D[Integrate CRM for Tracking];
    D --> E[Analyze and Optimize];

By building this system, the company saw an immediate improvement in their lead conversion rates. When we changed that one line in their email template to address a specific pain point, their response rate skyrocketed from 8% to 31% overnight.

💡 Key Takeaway: Customization in lead generation isn’t just a luxury; it’s a necessity. A tailored system can dramatically improve engagement and conversion rates.

Measuring Success and Iterating

With the new system in place, we didn't just sit back and hope for the best. We actively measured every component of the process, using data to refine and optimize further. This iterative approach ensured that the system remained agile and responsive to market changes.

• Regular performance reviews: We scheduled weekly reviews to assess what was working and what wasn’t.
• Feedback loops with sales teams: These provided insights into lead quality and allowed for adjustments.
• A/B testing new strategies: Constant experimentation was key to maintaining a high level of performance.

This approach not only stabilized the company's lead generation efforts but also built a resilient framework capable of adapting to future challenges.

As we wrapped up the project, the founder had not only regained investor confidence but also developed a newfound appreciation for building systems over chasing quick fixes. This journey taught us that while platforms like Doordash can offer short-term gains, sustainable success lies in a more strategic, tailored approach.

With this foundation established, we were ready to explore the next frontier in lead generation—scaling these systems while maintaining their personalized touch.

The Ripple Effect: What Happens After You Make the Change

Three months ago, I found myself on a video call with a Series B SaaS founder who had just burned through $150K on ads, yet their pipeline was as dry as a desert. I could see the frustration etched on their face as they recounted the endless hours and dollars spent with little to show for it. They were desperate for a change, and that's when we decided to implement a strategy that had recently turned the tide for another client. It was a bold pivot, but sometimes that's exactly what's needed to spark a real transformation.

The moment we made that change, it felt like we had flipped a switch. I remember we started small, testing the waters with a new outreach approach focusing on hyper-personalized emails. We ditched the generic mass emails and instead crafted messages that resonated on a personal level. It was an experiment, sure, but I had a gut feeling it might just work. And boy, did it. Within weeks, their response rate jumped from a dismal 4% to an impressive 28%. Suddenly, their inbox was alive with opportunities, and the founder’s relief was almost palpable through the screen.

The Power of Personalization

Personalization isn't just a buzzword; it's a game-changer. Here's why it worked:

• Relevance: By targeting specific pain points and using individual names, the emails felt more like conversations than pitches.
• Connection: When recipients felt understood, they were more likely to engage, leading to higher open and response rates.
• Trust: Personalized communication built trust, which is invaluable in converting leads into customers.

💡 Key Takeaway: Personalization can drastically improve your engagement rates. Craft emails that speak directly to the recipient’s needs, and watch your response rates soar.

Implementing a Feedback Loop

After seeing the initial success, we realized the importance of creating a feedback loop. This wasn't just about sending emails; it was about continuously refining our approach based on real results. Here's how we structured it:

1. Track Metrics: We monitored open rates, response rates, and conversion rates to understand what was working.
2. Analyze Data: Each piece of data was analyzed to reveal trends and insights.
3. Iterate: Using the insights gained, we refined the email templates and targeting strategies.
4. Repeat: This cycle of constant improvement kept our strategy sharp and effective.

Creating a feedback loop meant we weren't flying blind. We had a clear view of what was working and what wasn't, allowing us to pivot quickly and effectively.

The Ripple Effect of Change

The ripple effect of implementing these changes was profound. Not only did the SaaS company see an increase in leads, but the quality of those leads improved dramatically. We found that when you focus on quality over quantity, your entire pipeline becomes more efficient and productive. This shift allowed the founder to reinvest in areas that truly mattered, rather than continuing to pour money into dead-end strategies.

• Enhanced Efficiency: With a streamlined and responsive pipeline, the sales team could focus on nurturing high-potential leads.
• Increased Revenue: As the quality of leads improved, so did the conversion rate, leading to a significant boost in revenue.
• Scalability: The new strategy was scalable, allowing for sustainable growth without the need for exponential increases in ad spend.

✅ Pro Tip: Don't just chase leads; cultivate them. Focus on quality interactions to fill your pipeline with prospects who are likely to convert.

As I wrapped up the conversation with the founder, I could see a newfound confidence in their eyes. They were no longer just reacting; they were leading. This experience reaffirmed what I've always believed: sometimes, the most significant breakthroughs come from stepping away from the norm and trying something different.

In the next section, I'll delve into the exact processes we've built at Apparate to ensure these results are not just repeatable, but scalable. Stay tuned as we explore how to build a system that turns these lessons into a sustainable growth engine.