Grubhub Steps Up Student Tech Offerings to Build Long-Term Loyalty

As aggregators compete for college students’ loyalty, Grubhub is leveraging technology to boost convenience.

Madeline Maguire, senior director of B2B marketing at the aggregator, noted in an interview with PYMNTS that investing in ways to remove friction from on-campus dining for college students can pay off down the line in terms of those students’ future loyalty.

“Acquiring these diners earlier in life and providing a great customer experience — the better we can do that, the better long-term retention that we see,” Maguire said. “We want to acquire these diners now, so that when they age out of college, Grubhub is still their delivery provider of choice.”

Maguire highlighted Grubhub’s $150 million acquisition of campus food ordering platform of Tapingo in 2018 as one of its first major moves in this space, as a key step, enabling “direct integration into college meal plans and their point of sale systems.”

The aggregator has continued with this strategy, announcing as recently as last month that it is partnering with campus payment solution provider Transact to enable students to view and make purchases from Grubhub’s marketplace via Transact’s app, paying with their campus cards.

“This hasn’t been done before — the integration on the mobile app side,” said Jenna DeMarco, manager of corporate communications at Grubhub.

Additional campus-focused tech moves that Maguire pointed to include the aggregator’s on-campus smart lockers for meal pickup created in partnership with Apex and its rollout of robotic delivery on campuses.

“Robot delivery solves the unique challenges of accessing hard to reach areas that come with operating on a college campus,” Maguire said. “We’re excited about a lot of the innovations that are coming on that track in terms of improving the overall experience and helping us meet students where they are.”

Certainly, the demand among young consumers for convenient options is there, with PYMNTS research revealing that gen Z disproportionately seeks out restaurant delivery. Specifically, data from PYMNTS’ new exclusive report “Connected Dining: Third-Party Restaurant Aggregators Keep the Young and Affluent Engaged,” which draws from a survey of nearly 2,300 United States consumers conducted in March, finds that 69% of gen Z consumers reported having used a third-party food aggregator in the previous six months, up considerably from 54% just a year earlier.

Additionally, gen Z represented a greater share than any other generation. Only 64% of millennials, 40% of Gen X and 14% of baby boomers and seniors said the same.

Consequently, given this high demand, the student demographic represents a significant opportunity for players in the space. As aggregators compete for the high-value segment’s food spending, Maguire sees cost- and value-centric initiatives as key to securing their loyalty in the short-term future and views convenience as essential to building longer-term relationships with them.

“We’re going to continue to see innovations in and we’re going to continue to see students really expecting higher levels of customer service from all of their tech providers,” Maguire said. “At the end of the day … we win in this space when we make students’ lives easier.”