Wonder, the food hall startup by Marc Lore, recently announced its axing delivery fees altogether.
Customers will no longer see a $1.99 fee on delivery orders when ordering through Wonder’s website or app.
“This was a move on our part to be incredibly customer first and eliminate fees that we know are a pain point for consumers with marketplaces today,” said Courtney Lawrie, Wonder’s SVP and GM, in an interview with Food On Demand.
Delivery fees have been a headache for consumers amid the rise and popularity of third-party delivery.
Those fees on a DoorDash or Uber Eats order, for example, are typically waived only for subscribers of DashPass or Uber One. Wonder, however is waiving delivery fees on all orders, regardless of whether the customer has Wonder+, its subscription service.
It also waived its 12 percent service fees for orders placed through Wonder+, which costs $7.99 a month.
A fully integrated app
How? Wonder is in a bit of a unique situation as it operates its own food halls with its own delivery fleet.
By taking out the middleman, Lawrie said it “is able to pass those savings onto our customers in the form of no delivery fees.”
On stage during a panel last month at the Food On Demand Conference, Jason Rusk, EVP of restaurant operations at Wonder, broke down the company’s ecosystem.
“Wonder is a fully integrated app for dinner time,” Rusk said. “We own the marketplace, restaurant, and delivery, and it’s total transparency for consumers through the use of technology. One thing that e-commerce does so well, with the likes of Amazon, is it provides a one-stop shop for everything you need. The advantage we have is providing that type of experience in a restaurant format.”
The company also acquired Grubhub from Just Eat Takeaway for $650 million. Lawrie explained that the no-fee offer only applies to orders made directly through Wonder, not through the Grubhub app.
Lawrie added that while acquiring Grubhub has helped Wonder better understand habits and pain points, “it’s a bit of a different model.”
It will be interesting to see how the acquisition of Grubhub continues to play out as Wonder expands locations and its model.
Now with 50 locations, Lawrie said it is opening about one to two a week, largely in New York, New Jersey, Connecticut, and the Philly area, and “continues to expand across the Northeast.” It plans to open 95 by the end of the year.
Wonder’s food halls offer a variety of choices from more than 20 restaurant partners in one place, with a goal of 35 minutes on average to your door.
Most recently Wonder inked another $600 million in funding. The latest funding boosts its valuation to more than $7 billion.
