Under earnings pressure after a big loss last year, the food distribution company Grubhub struck a deal with Amazon on Wednesday, offering restaurant delivery services without a fee for Amazon Prime members.
As of Wednesday, the premium service, called Grubhub+, is now a free perk for Amazon Prime customers. Here is what we know.
What is Grubhub+?
Grubhub+ is a membership service, introduced in 2020, that costs $9.99 a month. It cancels delivery fees on orders that total $12 or more before taxes, tips and other fees. Amazon Prime members (including those who are already Grubhub+ members) will get a free year of Grubhub+.
Customers should then click on “Activate free Grubhub+.” The next screen will ask Prime members to sign in or create an account with Grubhub’s screen. Users can also sign in the same way if they have a Seamless or Seamless+ account.
After agreeing to terms and conditions, and agreeing to share proof of their Prime membership to Grubhub, customers can use the perk.
Why was this deal made?
The pandemic initially gave a boost to food service businesses like Grubhub, the company suffered losses in 2021 — about $410 million. But the lifting of pandemic restrictions throughout the country drove down demand for restaurant delivery.
The deal with Amazon, which already owns a stake in the struggling British food delivery service Deliveroo, will give Grubhub more cash flow in 2023.
Though this agreement with Amazon is only a year long, it will automatically renew annually unless Amazon or Grubhub opts out.