Speaker 1: Welcome to text Off. I'm Kara Price here with Oz Valascian.
Speaker 1: Hey Oz, Hey Kara. So I want to tell you
Speaker 1: a story about young me.
Speaker 2: Okay, I grew up in New York, and growing up,
Speaker 2: we lived in this small apartment and.
Speaker 1: We had this little play kitchen for me.
Speaker 2: Yeah, and of course like it had all the fixings,
Speaker 2: but I guess because it was a New York play kitchen,
Speaker 2: it had a telephone in it, so I was sort
Speaker 2: of playing at making dinner for my family, and my
Speaker 2: parents recall this story of me going into the kitchen
Speaker 2: and picking up the phone and calling for Chinese takeout, and.
Speaker 3: That was you making dinner in the playhouse exactly exactly right.
Speaker 3: Are your parents embarrassed or they like, She's the apple
Speaker 3: does not fall far from the truth.
Speaker 2: There are things that I said as a kid that
Speaker 2: they embarrassed them. That was not one of the things,
Speaker 2: because the truth is is that we mimic our parents behavior,
Speaker 2: and that's what my parents did. They ordered in So
Speaker 2: there's a reason that I've told you the story. I
Speaker 2: recently talked to Ellen Cushing, who's a staff writer at
Speaker 2: the Atlantic who primarily writes about food and food trends,
Speaker 2: and she shared with me this kind of pun intended
Speaker 2: het take.
Speaker 4: I think that delivery and what delivery apps have done
Speaker 4: to restaurants is the single biggest change in food basically
Speaker 4: since I've been alive.
Speaker 3: I actually have some more first hand observations about this
Speaker 3: because my stepfather owns a restaurant in London, and I
Speaker 3: watched first hand the delivery door Dash, Uber eats ification
Speaker 3: of his restaurant. He was actually a pioneer of doing
Speaker 3: high quality restaurant food delivery for an Italian restaurant in
Speaker 3: London in the kind of mid two thousands, and then
Speaker 3: these tech platforms came along and it went from like
Speaker 3: quite a significant share of the business back down to
Speaker 3: a very small share because the margins they take are
Speaker 3: so much that it's basically not worth It's not really
Speaker 3: worth doing unless your business is totally optimized for it.
Speaker 2: Yeah, I think it's something that if like you've ever
Speaker 2: been to a restaurant, you obviously think about. But I
Speaker 2: wanted to talk to Ellen because she demystified the sort
Speaker 2: of how and why delivery apps have overtaken the food
Speaker 2: industry and actually, like what really struck me about our conversation.
Speaker 2: Beyond the impact of delivery apps on restaurants was the
Speaker 2: impact these apps have had on.
Speaker 1: The actual dishes that are being served to.
Speaker 2: Us, Like delivery apps are actually influencing what we eat.
Speaker 3: I'm very intrigued to hear what it is because I
Speaker 3: love these I love and I'm slightly horrified by these
Speaker 3: stories about how technology doesn't just meet our desires, that
Speaker 3: actually shapes them.
Speaker 2: So I first asked Ellen for a brief overview of
Speaker 2: the history of delivery food and how we actually got
Speaker 2: to this particular moment where every restaurant on Earth seems
Speaker 2: to have a takeout option.
Speaker 4: So let me take you back through the sands of
Speaker 4: time to the nineteen nineties when and before that the
Speaker 4: eighties and the seventies, when delivery existed. It was something
Speaker 4: that mostly existed for Chinese and pizza. When I grew up,
Speaker 4: I'm from California, but I grew up and we had
Speaker 4: like a small stack of paper menus in a drawer
Speaker 4: in our kitchen, and when we got takeout, you know,
Speaker 4: you pull them out and you're kind of like, okay,
Speaker 4: kids who wants like Kung pao chicken? And so you
Speaker 4: would call the restaurant, they would dispatch someone who worked
Speaker 4: for the restaurant and they would bring you your food.
Speaker 4: What changed in kind of the early twenty tens was
Speaker 4: that it started being facilitated by this third party. So
Speaker 4: you had a bunch of companies pop up, all at
Speaker 4: the same time. They have since largely consolidated, but there
Speaker 4: were six or seven companies that were like, we can
Speaker 4: use phones, which everyone has now to facilitate delivery. We
Speaker 4: will not be using employees of restaurants. We will be
Speaker 4: using contractors. This was the era when like uber was
Speaker 4: the future of everything, and so they were like, we
Speaker 4: can use this army of contractors to deliver people's food
Speaker 4: and it will theoretically be more efficient because you can
Speaker 4: pick up from a bunch of different restaurants that are
Speaker 4: on the platform and deliver to a bunch of different people,
Speaker 4: and you have this like wonderful economies of scale thing.
Speaker 4: So that is the big change.
Speaker 1: It is very sad to me that kids will not.
Speaker 2: Grow up with the file folder full of menus that
Speaker 2: I grew up with. That was such a You just
Speaker 2: brought me back so much just thinking about that thick
Speaker 2: stack of menus that you'd have to read That was
Speaker 2: like early reading comprehension for me totally.
Speaker 4: And like it was such as a kid who loved food,
Speaker 4: it was such a source of fascination. Wow, there's all
Speaker 4: this food that I don't have. It's not food my
Speaker 4: parents are cooking. You know, it kind of rocked.
Speaker 2: It's also very funny to think, like, you know how
Speaker 2: gen Z is bringing back a lot of cassettes and
Speaker 2: even like mail order stuff. Like the one thing that
Speaker 2: I don't think is coming back is like delivery menus.
Speaker 4: Probably not. I mean I think as a society we're
Speaker 4: kind of post paper. Do what you think? Like, like
Speaker 4: I feel like we don't even get right right, You
Speaker 4: got a q comes from trees.
Speaker 2: Yeah, the QR code is not I'll never get on
Speaker 2: board with the qure kid, but whatever.
Speaker 1: That's taking us off track.
Speaker 2: So in the piece, you start by talking about the
Speaker 2: moment that delivery apps were conceived by a college student
Speaker 2: named Colin Wallace. So can you talk a little bit
Speaker 2: about Colin and where his idea came from?
Speaker 4: Yeah, and I should say Colin did not think of
Speaker 4: delivery apps. He just developed a piece of technology that
Speaker 4: help delivery apps talk to point of sale systems. The
Speaker 4: details of that are like pretty technical, but basically, this
Speaker 4: was a guy who was in engineering school at Georgia
Speaker 4: Tech and he really wanted a sandwich. He had these
Speaker 4: long lectures. He also, you know, he was going to
Speaker 4: football games and he kept feeling like, what if I
Speaker 4: could just get the food that I wanted delivered to
Speaker 4: my seat? Because you have to go, you have to
Speaker 4: stand in line, you're missing the game, et cetera. And
Speaker 4: so it was pretty obvious. You know, he's an engineering student.
Speaker 4: This is twenty eleven. Everyone has an iPhone basically, and
Speaker 4: so he was like, I feel like there's a better
Speaker 4: way to do this, and so he developed this system
Speaker 4: that basically replaced a lot of the delivery infrastructure was
Speaker 4: done by facts at this point, which is like a
Speaker 4: sort of crazy technology to be using in twenty eleven.
Speaker 4: So he figured out how to make it work on
Speaker 4: the phone and the rest was history. And you know,
Speaker 4: the company he started got acquired by grub hub and
Speaker 4: he became head of innovation.
Speaker 1: So I guess the question that I have is, like.
Speaker 2: The popularity of these apps takes off in the twenty tens,
Speaker 2: like for those of us who kind of have always
Speaker 2: adapted to the way that phones have changed things, which
Speaker 2: is my generation. You know, all of a sudden, grub Hub,
Speaker 2: door Dash, Seamless, you know, all these apps sort of explode.
Speaker 2: I'm using them all the time to do just about anything.
Speaker 2: I remember one time I broke my ankle and I
Speaker 2: ordered a wee charger from GameStop on uber on uber each.
Speaker 1: Oh, so, like there's no question.
Speaker 2: Now we go from you know, like very specific foods
Speaker 2: being kind of the ubiquitous takeout food to literally anything
Speaker 2: you can possibly imagine being something that you can get delivered.
Speaker 2: I mean, other than you know, Colin's invention. What is
Speaker 2: responsible for this pivot to like everything being on demand?
Speaker 4: The answer, Kera is money. That is that's what's important here.
Speaker 4: So this is again early twenty tens. This is a moment.
Speaker 4: I was living in San Francisco in the time. There
Speaker 4: was a lot of money, There was a lot of
Speaker 4: venture capital, and you know, VC is kind of winner
Speaker 4: takes all. I would say, it is a industry that
Speaker 4: is very much ruled by fomo. And there was this
Speaker 4: idea at the time that like, whoever wins the delivery
Speaker 4: wars will get access to a market of everyone who
Speaker 4: eats food, Right, So all of these different companies wanted
Speaker 4: to win, and all of these people that were funding
Speaker 4: these companies were just pouring money into it. And you know,
Speaker 4: this was also the era of the millennial lifestyle subsidy
Speaker 4: zerp Like, you know, money was very cheap, and so
Speaker 4: Silicon Valley was just like pumping money into all of
Speaker 4: these companies and basically subsidizing the cost of delivery. So
Speaker 4: what you have happening is you'd open Uber Eats or whatever,
Speaker 4: and you'd get these like ads basically that are like
Speaker 4: fifty percent off your first order, or like take twenty
Speaker 4: dollars off when you order three times in a month
Speaker 4: or something, and so they're like really incentivizing people to
Speaker 4: order delivery. They're basically you know, delivery costs money because
Speaker 4: you are adding labor and computer space and all kinds
Speaker 4: of infrastructure to a relationship. Right, You're adding another party
Speaker 4: to the relationship between the party who eats exactly. And
Speaker 4: so what was happening was was like Sandhill Road was
Speaker 4: like eating the extra cost. And so you have this
Speaker 4: brief period in the early twenty tens. Delivery is ubiquitous,
Speaker 4: it's on your phone, and it's cheap. Like sometimes it's
Speaker 4: even cheaper than like cooking for yourself or eating in
Speaker 4: a restaurant. And so they basically, in a very short
Speaker 4: amount of time, like invented a market that did not
Speaker 4: previously exist, and then it invented the expectation that it
Speaker 4: would be cheap. And that's very powerful. That's a very
Speaker 4: good way to get people kind of like addicted to something. Right,
Speaker 4: do you remember this era, like when delivery was so cheap.
Speaker 4: I was going to say it was the promo code era.
Speaker 4: It was crazy, like every time you ordered something you
Speaker 4: could get fifty percent off.
Speaker 1: Right, they were like please, we're.
Speaker 5: Begging you, well, basically pay you literally, and it was
Speaker 5: because they wanted you to be loyal to grub Hub
Speaker 5: or Postmates or whatever the app was, and they wanted
Speaker 5: to lock you in.
Speaker 2: Yeah, we were basically eating for free at that point,
Speaker 2: I remember this, And we were.
Speaker 4: Ubering for free, and we were getting access to all
Speaker 4: of these like apps for very little money. It kind
Speaker 4: of rocked.
Speaker 2: After the break White restaurants were forever changed by the pandemic.
Speaker 2: Stay with us, So the pandemic happens and then all
Speaker 2: of a sudden, delivery is the only way that restaurants
Speaker 2: make money, right, and then the pandemic ends and people
Speaker 2: don't want to change their behavior. And so my question
Speaker 2: for you is, like, what is the difference between promo
Speaker 2: code era to like delivery feels expensive again, but also
Speaker 2: like restaurants are empty, So what happens?
Speaker 4: Yeah, I mean, as you say said, like the pandemic
Speaker 4: was this inflection point in that like every restaurant that
Speaker 4: had been kind of holding out on delivery for various
Speaker 4: reasons now reach this point where they were like, oh,
Speaker 4: we have to do this or bebo clothes. I remember,
Speaker 4: you know, fancy restaurants, like nice restaurants were suddenly doing delivery.
Speaker 4: Places that had been saying, you know, our food doesn't
Speaker 4: travel well, or we think the economics don't make sense,
Speaker 4: or we have enough customers already we don't need delivery.
Speaker 4: We're now like, oh, we need delivery. And this was
Speaker 4: also a moment when, like you know, ordering delivery sort
Speaker 4: of became virtuous. It became like a victory garden, like
Speaker 4: if you want to keep a restaurant in business, you
Speaker 4: should order delivery from them.
Speaker 2: Yes, I remember that was right, because I mean, delivery
Speaker 2: workers were essential workers at the time, and it was.
Speaker 2: It was totally. It was like a mark of supporting
Speaker 2: the economy.
Speaker 4: Yes, exactly. It was like we're all going to get
Speaker 4: through this together. Like order a burrito, your party has
Speaker 4: change you wish to see in the world.
Speaker 1: Yeah, exactly, exactly exactly.
Speaker 4: But in answer to your question about like how it
Speaker 4: seems like delivery has gotten more expensive, it has. Part
Speaker 4: of that is that some municipalities have added taxes onto
Speaker 4: delivery to account for the fact that drivers need pay
Speaker 4: and delivery is kind of like one big externality that
Speaker 4: affects cities a lot, and so various places have added surcharges.
Speaker 4: But the real difference is that Silicon Valley stopped subsidizing
Speaker 4: it because these companies had to make money at some point,
Speaker 4: and so they pulled back the subsidies slowly. And so
Speaker 4: now when you buy delivery, you're paying the true cost.
Speaker 4: You are paying the cost of the food, the cost
Speaker 4: of the labor, the cost of the overhead, the cost
Speaker 4: for grub hub or whatever to make its cut. There's
Speaker 4: a lot of people who need to get paid now,
Speaker 4: and so you, the customer are paying that.
Speaker 2: So can you talk a little bit more about the
Speaker 2: economics of these apps like, how how does it work?
Speaker 4: Yeah, if you are a restaurant and you sign up
Speaker 4: for a delivery service, they are basically only three Now
Speaker 4: three companies control something like ninety eight percent of the
Speaker 4: delivery market in the US. It's basically DoorDash, Uber and
Speaker 4: grub Hub is much smaller than the other two. But
Speaker 4: you sign up for one of these companies, there's different tiers,
Speaker 4: but basically you are paying them for listing you on
Speaker 4: their app. You're paying them for facilitating the delivery, You're
Speaker 4: paying them for you know, placement within the app. If
Speaker 4: you open a delivery app, now you'll notice maybe that
Speaker 4: there's a lot of kind of like sponsored listings, or
Speaker 4: some random place will show up as like the best
Speaker 4: Indian food in all of New York City and you're like,
Speaker 4: this place has like two stars, Like how did this happen?
Speaker 4: And that's because they have paid extra. The rest of
Speaker 4: it us paid exactly, you know, And this is not
Speaker 4: unique to delivery apps at all. Like this is true
Speaker 4: on Yea and Google Maps, and it's true kind of
Speaker 4: everywhere on the internet. But that costs money. So restaurants
Speaker 4: are basically just turning a cut over to fees that
Speaker 4: are paid to the delivery apps.
Speaker 2: And you spoke to delivery drivers in this piece like
Speaker 2: this is not a lucrative job.
Speaker 4: It can be, you know, you will talk to drivers
Speaker 4: who say, someone tipped me one hundred dollars on a
Speaker 4: ten dollars order of wings. It's like any service job
Speaker 4: where it can be kind of random. But no, they
Speaker 4: are not paid by the hour. They're paid by the delivery.
Speaker 4: That of course incentivizes delivery drivers to move quickly, not safely,
Speaker 4: which can be a problem in cities. They are often
Speaker 4: driving really long distances. You know, I talked to a
Speaker 4: delivery driver who told me that he delivered like a
Speaker 4: cup of ice cream, like you know, like a single,
Speaker 4: not even like that.
Speaker 1: I mean, some of the things that I've ordered, I can't.
Speaker 2: I ordered a sleep like I ordered like two crispy
Speaker 2: cream doughnuts the other way.
Speaker 1: I mean, it's just salthy, And how should you pay
Speaker 1: for them? I don't want to. And that's when you
Speaker 1: close your eyes.
Speaker 4: That's between you and your God.
Speaker 2: That's right, yes, and the God of my understanding for
Speaker 2: sure exactly.
Speaker 4: You know, he drove like something like thirty miles to
Speaker 4: deliver this. He lives in a really rural area in
Speaker 4: South Carolina, and he's making like three dollars for forty
Speaker 4: minutes of work before gas and you know, maintenance and stuff,
Speaker 4: and the person who's paying like fifteen dollars. So no,
Speaker 4: it's not really a lucrative job. I think delivery companies
Speaker 4: would say these people are independent contractors. They choose how
Speaker 4: much they work, they set their own hours. It's a
Speaker 4: great job for college students or people who need to
Speaker 4: make a little bit of money on the side, but
Speaker 4: nobody is acting like this is the first step on
Speaker 4: a career ladder that will support you and your family
Speaker 4: for the rest of your life.
Speaker 2: Right, and yet it's very accessible and something that people,
Speaker 2: I mean, especially in cities like New York, it feels
Speaker 2: like everybody I see on a bicycle, everybody that I
Speaker 2: see in a car is somebody who's picking up something
Speaker 2: from a restaurant to take to somebody's house. Yes, and
Speaker 2: the lines outside of restaurants are and that's that was
Speaker 2: one of the things that really stuck out to me
Speaker 2: about your article is like, is this idea of like
Speaker 2: not so much how delivery has transformed the way we
Speaker 2: get food, but it's also transformed what idea of a
Speaker 2: restaurant is and like why does the restaurant exist? So
Speaker 2: from your point of view, like in twenty twenty five,
Speaker 2: like what is the purpose of a restaurant and has
Speaker 2: that changed on account of the explosion of delivery apps.
Speaker 4: That's the core of this and part of the reason
Speaker 4: I wrote this story to begin with. I just kept
Speaker 4: having this experience after Lockdown ended of going into restaurants
Speaker 4: in New York City and they would be like two
Speaker 4: thirds empty on a Friday night and there would be
Speaker 4: like fifteen delivery guys in the front of the store
Speaker 4: picking up food, and it would it didn't seem that
Speaker 4: good for them or for the people working at the restaurant,
Speaker 4: and it was sort of a bad experience for me
Speaker 4: as the diner. So yeah, I mean, I think that
Speaker 4: it often feels to me like a lot of restaurants
Speaker 4: are kind of like glorified vending machines.
Speaker 1: Now, like that's what it feels like.
Speaker 4: Delivery has changed the way people who run restaurants run restaurants,
Speaker 4: and it means when you build a restaurant, you are
Speaker 4: probably having way fewer tables and way more space for
Speaker 4: delivery drivers to congregate. You're having shelving for the delivery orders.
Speaker 4: Some of them have separate entrances for delivery versus din
Speaker 4: in because you know, you're essentially kind of like cramming
Speaker 4: two experiences into one where you're like in a restaurant
Speaker 4: and a delivery driver's like backpack. It's like hitting you
Speaker 4: on the head and you're like, it's just good. And
Speaker 4: then in terms of the food, you know, I talk
Speaker 4: to restaurant tours who are like, I'm putting more brazes
Speaker 4: on my venu, I'm doing fewer like deep fried things
Speaker 4: because they just don't travel well. This is kind of
Speaker 4: the reason that everything's like a bowl. Now, if you've
Speaker 4: noticed that bowls travel really well, they're kind of like
Speaker 4: saucy and gloppy, and they're not meant to be like crunchy.
Speaker 4: You know, anything that's crunchy is not going to travel well.
Speaker 2: The nineteen fifties was not a time for the US
Speaker 2: EBOL or the Ploi.
Speaker 4: Certainly not no, no, no no. But twenty twenty five, Oh.
Speaker 1: Baby, that's really interesting.
Speaker 2: Like that's basically what's in is like the thing that
Speaker 2: is portable.
Speaker 4: Maybe that's the best argument against delivery is that it
Speaker 4: makes the food taste bad.
Speaker 1: It's crazy.
Speaker 2: Yeah, yeah, yeah, But I guess my question is is, like,
Speaker 2: if we keep going down this path and restaurants become
Speaker 2: less and less of an in person experience, like what
Speaker 2: happens to the industry. And obviously you did a lot
Speaker 2: of reporting on this, it does seem a little bit
Speaker 2: dire for restaurants, and like, is there anything that looks
Speaker 2: like course correction post pandemic?
Speaker 4: I mean, really, where I see this going is I
Speaker 4: think it'll be like movie theaters, where like, obviously people
Speaker 4: are not gonna stop eating, people are not gonna stop
Speaker 4: like consuming, right, but like you're gonna see restaurants close.
Speaker 4: You're kind of always gonna be worried that your favorite
Speaker 4: one is going to close. They'll become rarer and rarer.
Speaker 4: It'll be this special thing that you do sometimes if
Speaker 4: you are an enthusiast. And that really freaks me out
Speaker 4: because I love restaurants.
Speaker 2: Yeah, that's such a good analogy. I didn't think about
Speaker 2: it that way. But the movie theater sort of as restaurant.
Speaker 2: It's the ease factor that's sort of cannibalizing the thing.
Speaker 2: And if you don't care about the experience to begin with,
Speaker 2: is it something that you're going to try to preserve.
Speaker 4: You know. I got a lot of email after this story,
Speaker 4: and a fair amount of it was from people saying like,
Speaker 4: I don't like restaurants. I don't like having to tip,
Speaker 4: I don't like sharing space with other people. I don't
Speaker 4: like waiting for my food, like basically a good riddance.
Speaker 4: And I was kind of surprised by that, just because
Speaker 4: if I have not already like tipped my hand and
Speaker 4: en augh, like I love restaurants. I love going to restaurants.
Speaker 4: So yeah, I mean, I do think some people truly
Speaker 4: don't care. I think with movie theaters it's going to
Speaker 4: be one of these things that we kind of like
Speaker 4: miss when it's gone. But yeah, I think some people
Speaker 4: just don't like restaurants. Don't care, don't care if they
Speaker 4: go away, don't care if they change so much as
Speaker 4: to be unrecognizable.
Speaker 2: It is such a strange phenomenon because on one end,
Speaker 2: it is so miraculous that we live in an age
Speaker 2: where you can have everything on demand, and then it's
Speaker 2: also like pretty spectacular how that thing that facilitates such
Speaker 2: an ease of sort of on demand life is the
Speaker 2: thing that might cannibalize the thing we're actually benefiting from. Again,
Speaker 2: not to sound overly romantic about it or bleeding heart,
Speaker 2: but I think we forget the cost of the thing
Speaker 2: when we're getting what we want.
Speaker 4: Yes, and look, there's a whole apparatus that is designed
Speaker 4: to make you forget about the cost of the thing.
Speaker 4: The thing about a frictionless service is that it's designed
Speaker 4: to alide all of the effort that goes in Tech
Speaker 4: companies are really good at this, Like their whole thing
Speaker 4: is eliminating friction. You know. Amazon is kind of the
Speaker 4: same way, like next day delivery. If you actually think
Speaker 4: about all of the like arms and legs and cars
Speaker 4: and trucks and planes and paper and plastic and warehouses
Speaker 4: that were required to get your box of paper clips
Speaker 4: to your house within twelve hours, it's astonishing. But they
Speaker 4: don't want you to think about that.
Speaker 2: Yeah, there's success sort of rides on how little you
Speaker 2: think about it in fact. Yeah, well, Ellen, thank you
Speaker 2: so much for joining me today to talk about the
Speaker 2: personal is portable.
Speaker 4: Thank you. This was really fun.
Speaker 1: That's it for this week for tech stuff.
Speaker 3: I'm care Price and I'm oz Vlasan. This episode was
Speaker 3: produced by Eliza Dennis, and Melissa Slaughter. It was executive
Speaker 3: produced by me Kara Price, Julian Nutter, and Kate Osborne
Speaker 3: for Kaleidoscope and Katrian Norvel for iHeart Podcasts. Jack Insley
Speaker 3: mixed this episode and Kyle Murdoch wrote our theme song.
Speaker 2: Join us on Friday for the Week in Tech, where
Speaker 2: we'll run through the headlines you need to follow.
Speaker 3: And please rate and review the show, and reach out
Speaker 3: to us at tech Stuff podcast at gmail dot com.
Speaker 2: We want to hear from you.