Even If You're Trying To Avoid Grubhub By Calling Your Favorite Restaurant Directly, Grubhub Could Still Be Charging It A Fee (buzzfeednews.com) 106
Customers trying to avoid online delivery platforms like Grubhub by calling restaurants directly might be dialing phone numbers generated and advertised by those very platforms -- for which restaurants are charged fees that can sometimes exceed the income the order generates. BuzzFeed News reports: Here's how phone fees work: Grubhub (which also owns Seamless, MenuPages, Tapingo, and LevelUp) generates a unique phone number for each restaurant on its platform; it appears on the restaurant's Grubhub or Seamless page and redirects to the restaurant's own phone line (a restaurant cannot list its own phone number on its Grubhub or Seamless page). The redirect number can also appear higher in Google search results (including the Google panel for that business) than the restaurant's own line. This leads some customers to call it even if they don't intend to use Grubhub. Some restaurant owners have also raised this concern about Yelp, which lists Grubhub numbers, according to Vice.
This is a long-standing practice for Grubhub, which was founded in 2004 and charged a commission for phone orders before online ordering took off. When a Grubhub number is dialed, the caller hears an automated message that says "Press 1 to place an order. Press 2 for all other information." It does not mention Grubhub. After the caller is connected, the platform can charge the restaurant a fee. Each restaurant's phone order fee is a flat dollar amount based on a percentage of its average sale. Grubhub charges that fee using an algorithm (which factors in a number of things, including the length of the call) -- even, in some cases, when it did not result in an order. A restaurant owner can challenge a phone charge within a certain period of time, but the onus is on them to see which charges are erroneous. The practice is now coming under fire as it further squeezes businesses already stretched thin by the coronavirus pandemic and the lockdowns.
"On Wednesday, the New York City Council passed a bill prohibiting platforms from charging for telephone calls in which a transaction did not take place during the state of emergency," the report says. "It also capped fees that platforms may charge restaurants for orders and deliveries during an emergency."
This is a long-standing practice for Grubhub, which was founded in 2004 and charged a commission for phone orders before online ordering took off. When a Grubhub number is dialed, the caller hears an automated message that says "Press 1 to place an order. Press 2 for all other information." It does not mention Grubhub. After the caller is connected, the platform can charge the restaurant a fee. Each restaurant's phone order fee is a flat dollar amount based on a percentage of its average sale. Grubhub charges that fee using an algorithm (which factors in a number of things, including the length of the call) -- even, in some cases, when it did not result in an order. A restaurant owner can challenge a phone charge within a certain period of time, but the onus is on them to see which charges are erroneous. The practice is now coming under fire as it further squeezes businesses already stretched thin by the coronavirus pandemic and the lockdowns.
"On Wednesday, the New York City Council passed a bill prohibiting platforms from charging for telephone calls in which a transaction did not take place during the state of emergency," the report says. "It also capped fees that platforms may charge restaurants for orders and deliveries during an emergency."
They want a slice of every transaction (Score:5, Insightful)
These 'food delivery' companies just want a slice of every transaction that occurs out there, just like Amazon, Apple, Google, Yelp and countless others.
If this keeps up, pretty soon we'll all be subsidizing companies that abuse business owners & their own "contact" workers, while these companies don't contribute anything of significance to society (only to their real "customers", which aren't your average Joe, but instead their investors)
P.S. anyone else call Grubhub "Grabhub" instead?
Re:They want a slice of every transaction (Score:5, Funny)
That's a nice little restaurant ya' got there buddy. Shame if something happened to it.
Re:They want a slice of every transaction (Score:4, Funny)
That's a nice little restaurant ya' got there buddy. Shame if something happened to it.
Yup, sounds just like Yelp.
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Yup, sounds just like Yelp.
Not really. Yelp can run negative reviews and hurt a restaurant's business even if the restaurant wants nothing to do with them.
Grubhub is completely opt-in. If you don't like the deal, don't sign up.
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You sure?
https://www.forbes.com/sites/l... [forbes.com]
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Matty had his little tantrum about Trump, meanwhile his company pulls shit like this. Such a moral exemplar.
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and all we need to do is put it on the list used by an robo dial er
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and all we need to do is put it on the list used by an robo dial er
That would probably hurt small business more than grabhub. I do like the way you think, though. If it could be turned into a DOS attack that wouldn't be charged to the business, that'd be great. It may be they designed this so griefers can't affect grabhub profits.
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The most onerous solution for GH probably involves something with spammers getting restaurant phone numbers in their "system" that don't actually belong to restaurants And are phone numbers located in one of those few high-cost destinations with an incumbent carrier who is not one of the large phone companies where receiving carrier has to pay a high call termination rate from the originating carrier per call to the receiving carrier then the spammers work to maximize the number of call minutes before GH
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Treat it like a phishing attack. Someone made a number that looks like the real one and people call it by mistake. Have the phone warn them and redirect them to the right number using a database.
And they'll be gone soon. Losing so much money (Score:3)
They'd like.to have a piece of everything. But then again, so would I.
Unlike me, Doordash lost $450 million last year on $900 million revenue.
These companies are losing crazy amounts of money and will soon be gone, or completely revamp their business model. An average company would makes 11.6% profit. Doordash is at -50%. Investors are going to get tired of giving money to them for them to flush down the toilet, then the company will be gone. They can't argue economies of scale will eventually get them pro
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Unlike me, Doordash lost $450 million last year on $900 million revenue.
...
GrubHub wasn't quite as bad in 2019, though they too lost money.
I like Sebby's suggestion--GrabHub. P'haps DoorDash can be known as PoorCash.
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They can't argue economies of scale will eventually get them profitable; they're at nearly billion dollar scale and not anywhere NEAR profitability.
A billion dollars is NOTHING. That is 0.3% of restaurant revenue, or one out of every 300 orders. They need to be WAY bigger than that to exploit economies of scale.
The economies of scale kick in when a single driver can pick up multiple orders from one restaurant and take them all to the same neighborhood.
The food delivery business needs a serious shakeout and consolidation.
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The end game is customer acquisition though. The investors are paying now to "teach the consumer" that ordering food online is done thru grubhub/doordash/postmates and looking over their aggregated menu data and definitely not visiting restaurant websites or using anything like the digital equivalent of a phone book to discover proprietors directly.
Think of it like trying to get website traffic today while not being listed on Google. Its not really an option. We thankfully are not there yet but the investor
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I can't see how they get there. The difference between random websites about types of dolphins and a local restaurant is that one is a local restaurant. The kind of place that is close enough I drive by it on my way home, the people I work with talk about it, the local papers talk about how it's been in business 50 years. GrubHub isn't going to get me ordering food from some new place. And GrubHub has no relevance in making me aware of a local restaurant that is popular.
I really question Grubhub as being pr
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These 'food delivery' companies just want a slice of every transaction that occurs out there, just like Amazon, Apple, Google, Yelp and countless others.
Slice? They want a big piece of a now smaller pie. If it was a reasonable percentage of the actual sale, I think that would be, well, reasonable.
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I heard once that the best part about being the man in the middle is that there's always a new middle to put a man in. The US has literally stopped creating actual industries and now just creates middle men. Actual industries get shipped to China.
Re:People Use Grubhub To Get A Phone Number? (Score:5, Interesting)
Apparently the grubhub redirect number shows up when you type the restaurant name into Google. (Yes, I read the article.)
I don't know about you, but I use google all the time to look up phone numbers.
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Apparently the grubhub redirect number shows up when you type the restaurant name into Google. (Yes, I read the article.)
I don't know about you, but I use google all the time to look up phone numbers.
That's exactly what's happening - phone number hijacking.
There was an interesting story about Doordash [substack.com] recently that discusses this. Google, Yelp all have a hand in this, whether they know it willingly or not.
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Google, Yelp all have a hand in this, whether they know it willingly or not.
Yelp are willing, they're a Grubhub partner. They do the equivalent of Uber's 'greyballing' with the restaurants. In other words if a member of the public visits Yelp they see the Grubhub redirect number to a restaurant. But if the restaurant is logged into Yelp using their own Yelp account, they see their own number on their restaurant profile, not the Grubhub number. This has been documented since mid 2019 (see below).
https://www.theverge.com/2019/... [theverge.com]
https://www.vice.com/en_us/art... [vice.com]
Phone directory? Restaurant's webpage? (Score:2)
Have we become collectively too stupid to use a phone directory to find a restaurant?
Or check the phone number on the restaurant's own page?
Or check which delivery partner the restaurant recommend themselves?
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I've never used GrubHub, DoorDash, Uber Eats, or Waitr, or any of the other similar systems. But the companies exhibit a lot of slimy behavior, and I see no reason to overpay for delivery of food that is
Re: People Use Grubhub To Get A Phone Number? (Score:2)
Now you have a reason to look for business' websites to get the number there. Until Grubhub starts building websites for them, too.
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Now you have a reason to look for business' websites to get the number there. Until Grubhub starts building websites for them, too.
This is it. I have to explain to the family often to ignore the helpful little text that Google puts at the top of the search results and the "business information" that they include for you. Go to the web site and get it from the actual business.
I used grubhub one time, but never again. They are just too slimy to get my business.
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I am with you.
I ordered using them exactly one time and it was a poor experience.
The more I read about them and their ilk, the more I am of the opinion that these parasites serve no purpose other than to bleed businesses dry.
Re: People Use Grubhub To Get A Phone Number? (Score:4, Interesting)
Re:People Use Grubhub To Get A Phone Number? (Score:5, Insightful)
And it's worth keeping in mind that the average customer has no reason to believe the phone number they find on their search is NOT the right one - especially when they try calling and get through to the restaurant they were expecting to get through to.
Imagine you forget your bank's website. You google it and you find www.bank-name.com instead of www.bankname.com. You click it, and you get an invisible frame containing www.bankname.com's website but the frame is actually sniffing your credentials while you're seeing exactly the website you were expecting to see. That's pretty much what's happening here.
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Yeah... except in that example situation its illegal and Yourbank would have an immediate recourse to shutdown the owner of Your-Bank.com owner. Yourbank hasn't signed some kind of agreement with the owner of www.bank-name.com providing To have all the traffic redirected to the proper website and give the bank-name.com owner a commission per hit.
Also; Grubhub is running some kind of directory service, or at least something that they pretend is a directory service by listing information about companies
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In other news, analogies are very rarely perfect because circumstances change.
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Re:People Use Grubhub To Get A Phone Number? (Score:5, Insightful)
Either Google is complicit (and is intentionally listing the Grubhub phone numbers) in which case it should be investigated for doing so. Or its algorithms are unintentionally picking up the Grubhub numbers instead of the real restaurant numbers in which case Google should fix its algorithms to not pick up the Grubhub numbers anymore. Any business where Google is displaying the Grubhub number instead of the actual phone number should be pushing Google to fix the information (and providing Google with the actual number)
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Probably unkowing complicit. Google prefers structured data, espescially if it is enriched with rdf metadata. That makes absolute sense for phonebooks, directories and other uaually reliable sources for data. (Think of the data boxes on the right hand side of a wikipedia page)
Unfortunately, this looked like an invitation for blackhat SEO to grubhub
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" Google prefers structured data"
On Google Maps, you can submit information manually.
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" Any business where Google is displaying the Grubhub number instead of the actual phone number should be pushing Google to fix the information"
First, they have to find out that Google is displaying the grubhub number.
Second, they have to go to the effort to prove they are the authoritative source for that location, instead of being a community-sourced edit.
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This should be considered deceptive advertising if the restaurants are not provided an option to list their True telephone number on any directory service, then there should be a mandatory disclosure notice that has to be placed prominently, clearly, and conspicuously in close proximity to the telephone number.
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Time to use duckduckgo.com instead. You'll also get unfiltered results so you're better informed.
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Who the heck uses Grubhub to get the phone number?
LOL! Gen Y doesn't know what a phone book is, that is how to read this story.
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And that is one way you get the grubhub redirect. (Score:3)
The article said that the Google Panel for the business picks up the grubhub number instead of the real number. Google Maps and the business panel use the same data source.
oh man (Score:2)
On one hand evil business practices well into extortion territory. On the other hand capitalism!
j/k
I only have one hand
Potential Uber Smear Campaign (Score:2)
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In general the fees charged are around 30% of the order, which are absurd. I generally make a point to go to a place in person and ask what the best way for me to order with them is and do that. Now, I have a dozen or so places where I can text the owner my order, and simplify the whole process.
(Although I do prefer going in person and just grunting... they know what I want anyway.)
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I do prefer going in person and just grunting... they know what I want anyway.
Are you Tim Allen IRL?
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30% for a website, delivery and credit card handling on very small purchases? That isn't too bad. The credit card overhead is approx. 6-10%, delivery costs are ~$5-10 regardless which is easily another 10-15% of the purchase.
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Delivery fees are on top of what they charge the restaurant.
Considering a restraunt’s gross margin is only around 30-35%, it is a huge hit. It is appropriate if it is your only form of promotion, but beyond that it is usurious.
in other words (Score:1, Troll)
This is diabolical.
Did you know that credit cards charge fees for every transaction, even if the fee is as much as the transaction?
Or that when you click through one of the ads on /. the company often has to pay an ad fee, part of which goes to /.
Very ofte
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Very often one of the huge costs in business is customer acquisition.
Except they aren't paying for customer acquisition here, they're paying because Grubhub is better at SEO than the average restaurant.
If article is true... (Score:2)
how is this not fraud?
If I did something like this against say... Microsoft I think we know what would happen.
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I recall a similar story from a while back where some company was pretending to be the restaurant and acting as a middle man without the cons
Not me. (Score:2)
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Stupid is as stupid does. (Score:1)
Add grubhub to the evil list (Score:2)
Solution (Score:3, Interesting)
Go to the restaurant’s Facebook page.
I kid, I kid... well maybe not. The one thing about Zuckerberg’s evil empire is - people willingly give him all their data, And his company has to do very little other than turn on the vacuum cleaner. Your local restaurant’s Facebook page is almost certainly managed by the actual restaurant. At the present time, at least. I’m sure Zuck will see this as another source of income he can exploit, soon enough.
Anyway, if you don’t trust what you find online, just drive by the place. They’ve pretty much all got their numbers posted on signs right now, or they have menus you can grab.
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I feel that the future somehow passed me by, because this is exactly what I do. I order pizza for home delivery, because that's home delivery food; everything else is car travel food (fast food), or sit down and enjoy yourself food. In rare cases I'll order takeout from a proper, sit-down restaurant because of shut-in relatives, but that's statistically very small number of incidents.
I'm getting the impression these last couple of years that anyone younger than Gen X simply gets food 100% of the time, and r
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Because there is content to binge during that 20 minutes, Jim!
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I'm the same way as you with regard to GrubHub / Uber Eats / Delivery Du Jour. I don't see a value in using them; I'd just as soon go get the food myself.
Currently we are getting takeout from local restaurants rather than sitting down there, obviously; but they're all places we've previously frequented and feel some connection too (plus we have some idea how they are maintained and run).
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I prefer eat-in too, mostly because a lot of food doesn't travel well. Sometimes they package things in the most clueless way. There's nothing worse than a hot sandwich that's been wrapped up like a mummy, steamed in to a soggy mess before it even gets to you. I think this might have something to do with why Chinese food is so popular as take-out. Most stir-fried rice dishes lose nothing in the box, some of them even taste better microwaved the next day.
Fraud. Plain and Simple. (Score:5, Insightful)
They are clearly presenting a phone number as belonging to the restaurant. It doesn't. The fact they re-direct to the restaurant does not mean it isn't fraud.
For example, many fraudulent web sites illegally fish for your password then re-direct you directly to the real website.
Redirection does not mean you are not a dirty little thief.
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They are clearly presenting a phone number as belonging to the restaurant. It doesn't. The fact they re-direct to the restaurant does not mean it isn't fraud.
For example, many fraudulent web sites illegally fish for your password then re-direct you directly to the real website.
Redirection does not mean you are not a dirty little thief.
Except in this case the restaurant entered into an agreement with GrubHub to provide the restaurant with a re-direct number and pay for the calls received. The restaurant may have expected to get new customers, not have existing ones, use the number and thus expand their sales and has discovered the fees Grubhub charges exceeds the added revenue; and is upset by that. That's a bad business decision. The phone number is presented as way to reach the restaurant, tThe customer gets through to the restaurant a
Re:Fraud. Plain and Simple. (Score:4, Insightful)
Isn't GrubHub the one that signs up restaurants without their consent and inserts themselves into the customer funnel. Then GrubHub says "give us money or all your phone orders go away." You know, the phone orders people looked up on Google?
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Isn't GrubHub the one that signs up restaurants without their consent and inserts themselves into the customer funnel. Then GrubHub says "give us money or all your phone orders go away." You know, the phone orders people looked up on Google?
I just ran across an article about DoorDash where a guy who owns a couple pizza shops had a storefront page created by DoorDash that he didn't know about (he only found when when some customers complained about delivery which he didn't offer), but they priced one of his pizzas wrong (they listed them for $16 while he sells them for $24). So, he got some buddies to place orders for those pizzas, paying DoorDash $16 but DD would pay his shop $24.
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I wonder why they priced the pizza wrong. Bad scraping?
Either way, good for him. Do you have a link?
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Here's a link: https://themargins.substack.com/p/doordash-and-pizza-arbitrage [substack.com]
Apparently it was bad scraping that priced all the pizzas on the menu the same as the cheese pizza.
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Al Capone v2 (Score:2)
Any mobster would have laughed his pants off.
And it's all legal in the greatest country in the world.
They don't apply gift cards automatically (Score:2)
I had giftcards in my account and used them for the first time. They did not apply my gift card. Customer service said, you have to do it manually.
Obviously good at making customers spend more money.
*%#$^#$@(%
Why no required disclosure? (Score:2)
If they are redirecting; they should be not only prohibited from taking a commission from Non-Orders, but they should also be required to disclose who they are and what telephone number they will actually redirect each call towards.
Parasitic companies (Score:2)
Yelp, GrubHub, and all the similar sites are fundamentally parasites. While a genuine review site would be useful, as soon as they began taking money from the companies they review (which was basically from the start), they lost any ability to claim neutrality, and hence any validity as review sites.
GrubHub has been caught registering fake websites for restaurants that aren't even customers. It wasn't GrubHub, but a similar site that was caught in my area, actually taking reservations for a restaurant that
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While a genuine review site would be useful, as soon as they began taking money from the companies they review (which was basically from the start), they lost any ability to claim neutrality, and hence any validity as review sites.
Kind of weird that those types of review sites become popular, even though it means their reviews are tainted. There are plenty of other ways a review site could make money, and not be tainted.
Restaurants can say no (Score:2)
It's a scam, why are these restaurants falling for a scam? Why is it _my job_ to keep them from paying for a scam?
"We don't do orders for grubhub" is a complete sentence that incurs no fees.
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Basically grubhub is, as one poster above stated, a modern day mob. Every time a food service is listed without permission on grubhub, they should be sued into oblivion - however most restaurants don't have the resources for that.
-Fraud, Fraud, whoops, I guess this is America where corporations have all the rights.
Why would you list on GrubHub? (Score:3)
If listing on GrubHub makes googling your business return a phone number that charges you fees high in the search results, why would you ever list your business on that scammy website?
I remember when GrubHub was listing businesses themselves, but people got delisted when they went after them. But why would you list voluntarily when there are other options out there...
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why would you ever list your business on that scammy website?
In Soviet Russia...
Re:Why would you list on GrubHub? (Score:4, Informative)
If you don't list with a delivery service, they may add you anyway.
I read a funny story yesterday about a pizza place that did not offer delivery so DoorDash added them anyway. The funny part is that they screen-scraped the menu but mixed up the prices so they charged $16 for a pizza that they paid $24 to the restaurant to get. So the writer and his friend, the owner of the restaurant, engaged in some pizza arbatrage: themargins.substack.com/p/doordash-and-pizza-arbitrage
Fuck Grubhub (Score:2)
Fuck middlemen (Score:1)
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That has become the new business model. 90% of all businesses now are just scammers trying to insert themself as a middleman into every transaction.
Re:Fuck middlemen (Score:4, Informative)
Technology should make these leeches redundant. Instead the entire industry is trying to shove itself between customers and businesses. Fuck these parasites.
All they're really doing is imitating the financial sector. Have you ever closed on a U.S. mortgage or done any kind of financial, business, or real estate transaction? Your closing statement will be filled with charges from various lawyers, escrow agents, inspectors, title companies, banks, etc. Each one inserts themselves as a transactional cost and gets a little cut.
The tech industry is doing similar. They are inserting themselves as an extra layer to the transaction. The problem is they're getting greedy and instead of taking a tiny cut, they're creating sizable gashes.
How... (Score:2)
How can this type of fraud be legal?
So glad I don't use any of those scams (Grub Hub, UberEats, etc...)
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At a basic level, Grubhub are masquerading as the restaurant and inducing members of the general public in to an action that results in Grubhub earning fees for doing nothing.
IMHO That's Fraud (Score:3)
By advertising a telephone number on their web site and claiming it to be "the contact number" for the restaurant in question, Grubhub are, in effect, masquerading as that restaurant.
They might try all sorts of different legal defences, but the bottom line is that if the number for a restaurant on *their* web site - or which they cause to appear in search results - is not the actual number of that restaurant, then they are using deception as a result of which they get paid.
That's just sleazy...
I'm still not understanding. (Score:2)
Slashdot has run a variation of this story before. Then, and now, I don't see what is stopping a restaurant from ripping up the "bill" and telling Grubhub to lick their ass. If the restaurant didn't contract for the service and didn't agree beforehand to a charge schedule, then really what Grubhub is doing is co-opting the restaurant's identity and intellectual property.
The end result should not be a payment, it should be a cease and desist letter followed by a lawsuit.
Re:I'm still not understanding. (Score:4, Insightful)
The problem is the gubhubs of the world don't abuse the giant chains or they at least come to an understanding with upper management in those cases. Its Katie's Crepery on Main street in your little town they run their protection racket on. Katie is struggling to understand all the various health and fire codes she has to comply with, her various insurance requirements, contracts with her actual suppliers, how to correctly calculated the landed cost of each menu item, and all the other details of running a restaurant. She does not have time to time chase civil actions against grub hub or money to hire an army of lawyers to ride against theirs.
Grubhub, Yelp, Doordash, Groupon - all those guys are fundamentally exploiting the asymmetrical nature of the situation. They know the Katies of the world have little recourse as a practical matter, they'd simply use delay tactics to keep a lawsuit running for a decade until Katie runs out cash worst case they have to settle with her for a couple hundred thou, long after her business is shuttered. The only real option is some kind of industry association to oppose these actors but that has its own anti-trust/collusion/interference issues and still represents an additional cost for little restaurants to sholder.
Maybe not universally true (Score:2)
I regularly call a pizza shop within walking distance and go pickup my pizza. I found there number by searching for local pizza places in my neighborgood using duck duck go. They use apple maps which seems to pull information from yelp. The number for the pizza shop I dial was found on yelp and goes directly to the shop, not a phone directory with options. This shop also does grubhub delivery.
It would be really nice to know if I'm still giving grubhub money in this scenario or if maybe places can put their
Behind Every Sleazy Idea is a....? (Score:3)
I've sat in countless strategy meetings. Discussed lots of good ideas and bad about how to grow, expand, get more customers, get more business, where will our business go, etc. Talked to customers, competitors, etc. Put strategy together. Executed. Helped fuel double-digit growth.
Not only have we never come up with something this sleazy, anything even approaching something like this would, at best, be laughed out of the room.
Who the f*&# comes up with this kind of stuff? More importantly, who approves it? Can you imagine that conversation? "Hey Bob, I have an idea how we can force companies to use our business and then force them to pay for the privilege. We don't have to worry about signing them up for our service, or providing much of anything. I mean, we have a little infrastructure work to do, but it's low risk - practically a solved problem! - and no need to pay salespeople or provide any level of satisfaction." "Wow, Karen, I'm intrigued! Tell me more..."
That's what gets me. Not that someone, or even a small group of someones, came up with this. It's that an entire corporation threw themselves behind this as the actual strategy.
Strange use of the word "favourite" (Score:2)
Where does searching Goohoo/ Yagle for a number I already have come from. The very act of putting the number as an entry into my phone's database is what marks the place moving from the class "Yet Another Food Place" into the class "Somewh