WTF?! Yelp is secretly replacing the phone numbers of restaurants with Grubhub-affiliated ones. This allows Grubhub to extract additional marketing fees from restaurants and many owners may not even realize it. It's a shady practice that's sure to sure to bring greater scrutiny.
Yelp is surreptitiously replacing phone numbers with Grubhub-affiliated numbers once a customer clicks on the phone number to call the business, per a report from Vice. The tactic seems to be a way for Grubhub to extract additional commission fees from restaurants that use the service.
Vice reporter, Adrianne Jeffries, detailed her experience when she tried to order from her favorite sushi restaurant using Yelp. The woman who answered the call at the restaurant didn't recognize the number that Jeffries called. Apparently, the actual number that Jeffries called was a number owned by Grubhub, which Yelp is affiliated with.
While users can technically call the restaurant directly using Yelp, if the person clicks on "Order Delivery or Takeout", it presents the option to order through Grubhub. Additionally, if the click the actual phone number of the business, the phone number that appears in the dialer is not the official phone number of the business. This Grubhub-owned number enables the company to track it and use it to extract fees and commission from restaurants.
Grubhub charges restaurants between 15 to 20 percent of the order total in exchange for the privilege of being listed on the Grubhub platform. Restaurants are also charged an additional 10 percent if they participate in the physical delivery service.
“It is our understanding that Grubhub has marketing agreements with some restaurants that allow Grubhub to utilize referral numbers on third party partner sites like Yelp,” a spokesperson for Yelp told Vice.
A spokesman for Grubhub also responded saying, "It is important to keep in mind that we are a marketing platform and, in almost all of these cases, the diner would not have discovered or placed an order with this restaurant without our platform.”
This means that Grubhub treats ordering through Yelp as "marketing" because of the agreement made with Yelp. However, even if a business has a marketing relationship with Grubhub, they may be unaware that they're still being charged marketing fees if a customer calls the restaurant using Yelp. The Vice article points out at least two restaurant owners who were unaware that the Grubhub-owned numbers were showing up.
Last weekend, my boyfriend and I searched for "takeout" on the Yelp app. It filtered all the results to only restaurants that were on Grubhub, and clicking menu lead you to the Grubhub order page. The amount of deep linking to maximize commission is wild. https://t.co/AdrjMJrr2r— Natt การุณรังษีวงศ์ (@nattgarun) August 6, 2019
This isn't the first time Grubhub has tried to covertly increase its marketing earnings. A report from New Food Economy claims that Grubhub created thousands of shadow websites that drove more online orders through Grubhub. This subsequently allowed Grubhub to charge restaurants higher commissions. In some cases, the amount of Grubhub shadow websites overshadowed the real restaurant's website in search visibility.
If anything, this highlights the downside to the online food delivery. While it is convenient to order your favorite food from your smartphone, this also incurs a huge cost to restaurant owners.