Recently, DoorDash CEO Tony Xu announced new changes coming to DoorDash. Senior RSG contributor and Dasher extraordinaire, Dash Bridges, tackles what these changes to transparency and more may mean for Dashers.
DoorDash also recently announced a change to their tipping policy. Are you a DoorDash courier and would you be willing to share your story with reporters? Fill out this form if you are willing to be contacted about your experience and thoughts.
If you’re into reading about DoorDash, you may have seen DoorDash CEO Tony Xu’s blog about DoorDasher pay. In it, he discussed a variety of initiatives and updates to their driver policies, including pay transparency and changes to the pay boost algorithm. While this updated commitment to Dashers wasn’t this dramatic, there’s a lot to digest, and various writers brought up topics they felt were worth exploration.
As Xu said in the blog, they began this effort in March. Not coincidentally, that was shortly after the Great $0.80 Instacart Payment Debacle that occurred around the same time. Labor, media, and the government were soon to scrutinize these platforms, and they wanted to get ahead of it. And to their credit, I think a lot of people put in great effort to better understand the needs of their Dashers. How much will it ultimately benefit the driver? I’m not so sure.
However, let’s break down what this means for Dashers, including pay transparency and clarification on time vs. distance orders.
Will Dashers Get More Pay?
First of all, nowhere in the blog did Xu say he was going to pay us MORE. If you hoped for guaranteed minimums per hour or higher per delivery payments, you’re out of luck. News flash: Everyone wants to be paid more! I do. You do. Tony Xu probably does! But DoorDash, although swimming in funding, isn’t profitable, and their undertaking wasn’t ever about paying more per hour/delivery. That was off the table.
According to the Xu’s blog, the results of DD-administered Dasher surveys yielded two very clear priorities:
- Make earnings more transparent (i.e. show pay breakdown)
- Make longer-distance deliveries more worth their while
These options were chosen nearly twice as often as the next most popular topic, ‘Don’t offer me deliveries out of my zone’. So let’s take a look at these two, specifically.
Show Me The Money! No Really, Show It To Me
This is what I currently see on my payment breakdowns.
I see my guaranteed minimum. I also see the amount I made for each delivery on each Dash. Finally, my week’s earnings are broken into macro-level tips and DD-paid delivery earnings. I never know how much each customer tipped. For the Noodle Talk order above, I have no idea if the customer tipped $7.94, $0, or somewhere in between.
On one hand, it doesn’t really matter. I agreed to a minimum payment of $8.94 for the delivery and I got it. On the other hand, the practice of DD decreasing their payout based on the generosity of the customer is absurd. Unfortunately, that practice isn’t going to end, but we will get to see how the sausage is made.
Per the blog, here’s an example of the new system. Kinda cool, right? After every order, you’ll see where your earnings came from, whether it was customer tip, or DD. In general terms, I love it.
This is the type of transparency Dashers deserve to see. We see what DD pays, and we see what the customer paid. When I get notification of a large tip, I always send a text back to say thank you. It’s important!
As for the actual readout, it would be more straightforward if DD either a) placed the base pay and additional pay on consecutive lines or b) consolidated their full contribution to one line, even if it said, “DoorDash pay (never under $1.00)”. When they give themselves two lines of contribution, it suggests they’re going out of their way to pay you. “Please note. We’re paying you TWICE, base pay AND additional pay (pats selves on back)”
All the breakout needs is: DD paid X. Customer tipped X. That’s it! Regardless, when I filled out this survey, I also listed pay transparency as a top priority, so it’s an encouraging development.
Why is DoorDash Moving to Pay Transparency?
DoorDash knows their pay policy is controversial, so it made sense for them to drag their feet on transparency. No one’s mentioned that they may have an additional reason: Customer protection.
My personal experiences with customers are almost universally positive. However, the Facebook groups are filled with stories about demanding customers, rude customers, etc. What’s going to happen when these uncommon but real interactions include a $0 tip?
I’ve never seen or read about a physical altercation between a Dasher and customer, but what happens when a Dasher waits an hour for a six-pizza, $130 order, carries it through a confusing apartment complex, delivers to a customer who makes a snide remark about “the pizza better not be cold. You guys screwed up my order again!”. Then the Dasher turns away after the door closes, slides the bar to complete the order and sees:
Customer tip: $0.00
Can’t you see a scenario where a Dasher turns around, knocks on the door and tells the customer what they can do with their pizza, and where they should do it? If I controlled the UI, I’d keep the current method of top-line only information upon delivery completion. At the end of the shift, I’d offer the expanded breakdown.
If nothing else, the revelation of the bad tip & customer interaction might be 1-2 hours in the past at a forgotten address across town, thus avoiding any conflict. Maybe I’m overthinking it.
Compensation by Distance, or Time?
Another popular Dasher need is to better compensate for high-mileage orders. My experience is that mileage seems to be a consideration, but not necessarily a major factor, in determining your delivery rate. For instance, you can squint and see a pattern here:
The delivery on the right is somewhat farther than the first, and it rightly pays more. But also, the 2nd order also has two items instead of one. Is that a factor? And what are the values of each meal and does that factor into the total price? DoorDash also already knows the tips. How much are the tips? Maybe it’s not so clear after all.
Now add a couple more orders, listed from shortest to longest mileage:
Can YOU make heads or tails of that? Who knows how the formula is weighted?
Similar to other platforms, DD is considering isolating the mileage variable with a specific per mile payout. It’s another great move forward for transparency.
I will say, though, that mileage isn’t as significant as time elapsed from restaurant to customer. The moment I pick up my food, I click the address and check the Google Maps drive time to the customer. When I started in 2015, it felt like my deliveries were 8-10 minutes away from the restaurant. These days they’ve routinely crept up to 13, 16, even 20 minutes. I’d rather drive mostly on a freeway for 8 miles over 10 minutes than crawl 4 miles in 18 minutes across town. I drive a Prius C. I get 48mpg. My time costs more than my gas.
I make money by turning orders, and I need either a) shorter deliveries or b) compensation based on my time! DoorDash corporate, please consider drive time over mileage as the correct variable to compensate drivers. I’m submitting this to your suggestion box, please and thank you!
Again, while many of you are disappointed that there’s no grand overhaul of the payment structure, in the name of transparency, I applaud these moves to help Dashers understand how we’re getting paid.
Drive safely, everyone!
Dashers, what do you think of these new changes coming to DoorDash? Do you think they’ll improve the Dasher experience?
Ready to sign up for DoorDash? You can sign up with DoorDash here!
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-Dash @ RSG