Grubhub waives all delivery fees on orders over US$50 to challenge rivals

USA – Food delivery platform Grubhub has announced a bold new pricing strategy, eliminating all delivery and service fees for customer orders exceeding US$50.

The move, set for a limited launch before a broader rollout on February 2, 2026, is a direct bid to win market share from dominant rivals DoorDash and Uber Eats by addressing the industry’s primary consumer complaint.

Targeting the Industry’s “Biggest Pain Point”

Grubhub CEO Howard Migdal identified high fees as the sector’s “biggest pain point,” noting that the average delivery and service fee for orders above US$50 on competitor apps is approximately US$13.

He revealed that 81% of Grubhub users have abandoned their cart after seeing the total fee charge at checkout. The new policy is designed to directly counter this friction, with Migdal stating the company expects it will save customers “hundreds of millions of dollars per year.”

The strategic shift emphasizes building long-term customer loyalty over maximizing near-term transaction earnings.

Leveraging Expanded Scale for Aggressive Growth

This aggressive pricing play is supported by Grubhub’s significantly expanded operational footprint over the last 18 months.

Following its acquisition by Wonder Group in early 2025 for an enterprise value of US$650 million, Grubhub has added more than 100,000 restaurants to its platform and extended coverage across U.S. suburban areas.

Migdal noted this expansion now brings the service within reach of 90% of American consumers, providing the necessary scale to launch a nationwide fee-waiver promotion.

The strategy further aligns with its parent company’s recent acquisition of the restaurant rewards app Claim, aiming to build a more comprehensive ecosystem for diners.

A Calculated Gamble in a Competitive Market

The initiative represents a high-stakes gamble to disrupt the established dynamics of the U.S. food delivery war, where DoorDash and Uber Eats collectively control a majority of the market.

By removing fees on larger orders, which are typical for family dinners or group events, Grubhub aims to incentivize higher basket sizes and attract cost-conscious customers directly from its competitors.

The success of this strategy will depend on its ability to convert initial sign-ups into habitual users and manage the underlying cost of delivery, potentially reshaping competitive pricing pressures across the entire industry.

If successful, it could force rivals to reconsider their own fee structures in a market where customer retention is fiercely contested.

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