This is a credit cards newsletter now
Not really. But these sophisticated payment networks have their fingerprints all over the way we eat.
I have never been a prolific credit card power user or points-maximizer, but given a string of recent announcements I should probably start paying more attention.
Last week, DoorDash expanded its partnership with Chase. Cardholders have been able to access free DashPass subscriptions for years, but the extended benefit, which offers subscribers free delivery and reduced service fees on most orders, is now extended through the end of 2027. (The covered subscription term varies depending on card type.) DoorDash says that on average, its DashPass members save $5 per order.
The Chase deal intentionally highlights DoorDash’s growing grocery business. The third party delivery is now, as the press release notes, Chase’s exclusive grocery delivery partner. (Per CEO Tony Xu on last week’s earnings call, DoorDash is also Chase’s exclusive restaurant delivery partner.) The DoorDash deal boxes out Instacart, which once had a Chase deal of its own offering cardholders complimentary Instacart+ subscriptions. That offer expired on July 31, one day before DoorDash announced its program expansion.
The DoorDash deal is just the latest restaurant technology + credit card linkup offering some form of premium access to restaurants.
When American Express bought Resy in 2019, the prestige card company promised to provide its cardmembers access to and experiences at more restaurants, acting as a kind of gatekeeper for the good life. After the acquisition, Amex debuted a new tier of reservations on Resy, Global Dining Access, for its members.
In June, American Express announced it plans to acquire reservations provider and Resy competitor Tock — long a favorite service of higher end restaurants — to sweeten the deal. (The acquisition is subject to regulatory approval, a process that Tock’s CEO Matt Tucker told me he’s not worried about.)
A few weeks later, OpenTable announced a credit card deal, partnering with Visa to offer its prestige cardholders special access to a collection of sought-after restaurants, almost certainly in part thanks to the precedent that the Amex + Resy deal set years before. In an interview, OpenTable’s CEO Debby Soo told me, “We didn’t invent this. The reality is that this is the playing field that we are playing on.”
Separately, during an interview about his new company, Resy’s co-founder and former CEO Ben Leventhal took some credit for this evolution.
“The Resy acquisition at Amex… I think that playbook we created there is the playbook that’s generally being used in the category now,” he said. “I’m not surprised to see that other companies are following suit.”
Credit cards obviously have a long history with the hospitality business.
Co-branded hotel and airline cards have long courted frequent travelers; a newer crop of points-based cards uses a long list of perks and access to help justify high annual fees. But the acute focus on access to restaurants feels new, especially when put in a historical context.
OpenTable is currently owned by Booking Holdings, also parent company to travel sites Kayak, Priceline, and Agoda. During OpenTable’s 2014 acquisition, Priceline leadership promised links between the travel- and restaurant-booking sites that never fully materialized. (I reference this all the time, but during an onstage interview in either 2017 or 20181 at an event put on by my former employer, Skift, Booking CEO Glenn Fogel admitted that the company had yet to fully realize OpenTable’s promise and potential.)
It’s been a number of years since that interview, but even today, the online travel conglomerate makes its money as (surprise!) an online travel agency — per The Verge, the site Booking.com accounts for 90 percent of the company’s revenue. (This is probably why the entire company was renamed Booking Holdings from the Priceline Group in 2018.)
When I interviewed OpenTable’s Soo about her company’s new credit card partnership last month, I really wanted to talk more about Visa and what this deal might mean for OpenTable’s future. She declined to indulge my speculation.
Amex is paying $400 million for Tock, which is the same amount that website provider Squarespace shelled out for the service the first time it was acquired, in 2021. Then, still deep in the throes of pandemic shutdowns and regulations, restaurants (and the tech companies that support them) valued online ordering and takeout. Tock managed to build a product that turned a huge number of its restaurants from sit-down experiences to dining-at-home services, and that customer base was clearly attractive to a website provider. Clearly, things have changed. (Among the changes: Squarespace went from underperforming publicly traded company to private company in a $7 billion private equity deal in May.)
As our dining tastes and needs have evolved, so have the cards. The earliest days of the Covid-19 pandemic left card issuers scrambling to add rewards and perks that represented our new stuck-in-quarantine lifestyles. Cards rewarded spending on groceries, on restaurant delivery. When I covered this four years ago for Eater, Benét Wilson, then credit cards editor for travel and loyalty site The Points Guy, predicted that card companies would struggle to roll back the pandemic-era rewards.
Four years later, this has proven true. We’re in a new era of card perks and points as these massive financial companies work to broker access to the restaurant experiences we love.
What else?
DoorDash says demand for delivery isn’t waning. “We're seeing really strong demand on the consumer side. So we're not actually seeing some of the challenges that you may be hearing about or reading about in other headlines,” CEO Tony Xu told investors and analysts on the company’s second-quarter earnings call last week. DoorDash’s total earnings are up 19 percent year over year; its revenue is up 23 percent. — release
DoorDash also added new fees in Seattle to offset the city’s regulatory laws. It’s adding $1.99 to some deliveries. According to a statement: “Due to Seattle’s broken delivery pay law, DoorDash continues to lose money in the market despite instituting a [$4.99] regulatory response fee.” These types of announcements always have real “look what you made me do” energy, don’t they? — KIRO7, Seattle
I recorded an episode of the Spoon’s Food Tech News Show last week. We talk Blackbird, DoorDash, artificial intelligence, and more. — The Spoon
The future of hospitality at Shake Shack is a fast drive-thru. New Shake Shack CEO Rob Lynch says drive-thru times are twice as long as they should be. Optimizing for speed might include new combos and ‘kitchen optimization,’ just like Shake Shack chief financial officer Katie Fogertey told me in an April episode of my podcast, the Simmer. — Restaurant Dive
1Sorry! The details have gotten fuzzy. Long story.