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 out delivery fees on orders of $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+.
How can the offer be redeemed?
Amazon Prime members can redeem the Grubhub+ membership by first going to amazon.com/prime/offer/grubhub/prime-deal and signing into their accounts.
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.
After agreeing to terms and conditions and being asked to agree to share proof of their Prime membership to Grubhub, the perk can be used.
Why was this deal made?
Though the pandemic initially gave a boost to food service businesses like Grubhub, the company suffered losses in 2021 — about $410 million — after pandemic restrictions were lifted throughout the country, driving down demand for restaurant delivery.
Labor shortages and increased government regulations also contributed to Grubhub’s difficulties.
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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 opt out.
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