Which is better GrubHub or Seamless

Talkin go money

Prior to their merger in 2013, Grubhub and Seamless were America's two premier online restaurant food ordering services. Today, the brands continue to operate separately within the combined organization GrubHub Inc. (GRUB GRUBGrubHub Inc62. 92 + 1. 17% Created with Highstock 4. 2. 6), which went public in 2014. Matt Maloney, the co-founder and former CEO of GrubHub, is now the CEO of the combined organization. Jonathan Zabusky, the former CEO of Seamless, is now its president.

The combined strength of GrubHub and Seamless has created a giant in the online / mobile food ordering market. In 2014, GrubHub Inc. made nearly $ 2 billion in gross sales to restaurants. The company now processes nearly 220, 100 orders per day and serves 35,000 restaurants in 900 locations across the Americas and the UK. GrubHub, Inc. now has offices in Chicago, New York and London.

While GrubHub and Seamless provided similar services, they developed separately; As a result, each brand has its unique strengths. In the following we will look at both business models, examine their histories and see what the future could look like for the combined entity.

Seamless

Jason Finger and Paul Applebaum launched SeamlessWeb in 1999. The B2B service initially offered companies a system with which employees could order food from restaurants and caterers online. This was convenient for users and convenient from an accounting point of view. In 2005, Seamless was released to the general public. The company launched a mobile website in 2009, followed by a range of mobile applications. In 2011 the suffix was removed and "SeamlessWeb" became "Seamless".

One of the most important functions of the service is the "Food Tracker" which allows users to monitor the status of their orders in real time. Another is Boost, which supports restaurants that Seamless works with and provides a platform to help them manage and track orders. The company's focus on corporate accounts has always been strong, allowing restaurants to consolidate their orders, billing and bookkeeping processes. And in 2011 Seamless acquired MenuPages. com-a website that displays more than 50,000 restaurant menus to users.

Another specialty of Seamless is its strong presence in New York City, where a large and loyal customer base has developed. In fact, Seamless has kept its focus on big cities in general, while GrubHub has worked to open up a much wider range of locations across the United States, paying attention to both small towns and cities.

Today Seamless is available in Boston, Chicago, Houston, Miami, Los Angeles, New York, Philadelphia, San Francisco, and the District of Columbia.

GrubHub

Web developers Matt Maloney and Mike Evans founded GrubHub in Chicago in 2004. They got the idea while working at apartments. com where they were frustrated by a lack of food delivery options.

GrubHub offers delivery or pickup orders from over 30,000 restaurants. Its platform offers menus, reviews, restaurant information, coupons and discounts. GrubHub orders can be placed through the GrubHub. com website or via mobile apps for iOS and Android devices. A "Track Your Grub" feature provides customers with real-time notifications and job assignments. And like Seamless, the company creates products that restaurants can use to work more efficiently. GrubHub's partner restaurants receive an Amazon Kindle Fire tablet preloaded with its "OrderHub" app, while delivery drivers use a "DeliveryHub" app to track their pickups and drop-offs.

In 2011, GrubHub acquired AllMenus. com- a website listing more than 250,000 restaurant menus. GrubHub's geographically diverse presence serves locations in more than 800 cities.

Although GrubHub started on the freemium subscription model and charged $ 140 for six months of premium placement on the site, after two years it changed course and adopted a transactional model where commissions were collected through its services from each order location. Co-founder Matt Maloney described the turnaround in his column for the Wall Street Journal: "Grubhub customers knew they wanted to pay a dime when they made a dollar. Those inquiries prompted GrubHub, We switched from a subscription model in 2006, where We charged restaurants for award placement, all the way to a transactional model where we collect a commission for every order. That was a turning point when we saw a dramatic increase in restaurants taking our ordering platform. "

As of this writing, GrubHub still allows restaurants to rank higher on their search lists by paying a higher commission. "Restaurants can set their commission rate," according to a company prospectus, "at or above the company's base rates to influence their relative priority in sorting algorithms. Restaurants that pay higher commission rates tend to appear higher in search order than restaurants. Pay lower commission rates. "

The current business model

GrubHub and Seamless continue to use transactional business models. The percentages have not been published, but with data from the IPO prospectus, analysts have set the figure at 13.5%. In 2015, GrubHub Inc. acquired Diningin and Restaurants on the Run, which also provide delivery services. "We believe delivery is a way of both our ability to enter our existing market and to expand the market in general with new restaurants," said Maloney in an award speech. "But it's not just about growing the market. It's also about increasing the level of service to our customers by increasing delivery speeds, which gets better when you add the scales."

The Competition

Grubhub Inc. faces stiff competition from technology giants keeping an eye on the on-demand delivery market: Yelp (YELP YELPYelp Inc45. 65-0. 91% Created with Highstock 4.26), Uber, Amazon (AMZN AMZNAmazon.com Inc1, 120. 66 + 0. 82% Created with Highstock 4. 2. 6) and Google (Goog). A particularly looming threat is Amazon's Prime Now delivery service. According to a recent article by GeekWire, Amazon is secretly testing its own restaurant delivery service by allowing Seattle employees to use Prime Now to order meals from local restaurants. With this company's logistics and sales expertise unmatched, it poses a real threat to Grubub Inc.

The bottom line

Although GrubHub Inc. is the clear leader in the American online ordering market, GrubHub Inc. will have to be nimble. to stay up. With competitors nibbling on their heels, hungry users can expect to benefit from constantly improving apps, more restaurants to order, and more efficient delivery services. (See also: GrubHub: Should You Buy?)