DoorDash to expand into Auckland a year after market entry

DoorDash will launch in Auckland in July.

DoorDash, the prominent US food delivery company, is preparing to expand into Auckland, the largest market in New Zealand, after a year of quietly developing its operations in Wellington and Christchurch. The company aims to facilitate home food delivery in a similar fashion to competitors like UberEats, Delivereasy, and Menulog.

Having entered the New Zealand market in June 2022 with its Wellington launch, DoorDash states that its New Zealand venture has been its most successful to date. According to Rebecca Burrows, DoorDash’s General Manager for New Zealand and Australia, this achievement can be attributed to building a local team and gaining a deep understanding of the market prior to launching services.

Burrows remarked, “We had very strong uptake very quickly. We built on that growth and launched Christchurch a couple of months later; also very successful, with a similar strategy of being on the ground, getting to know who are the restaurants that people love and what services people are looking for.” DoorDash currently maintains a small team of seven individuals located in offices in Wellington and Auckland.

Over the past six months, the company has experienced consistent growth of around 20% month-on-month. With a market capitalization of US$25 billion (NZ$39 billion) and a claimed 60% share of its largest home market in the United States, DoorDash has established a significant presence in the industry. However, the company has faced criticism in recent years for practices such as alleged tip withholding, listing restaurants on its platform without permission, and questionable pricing strategies.

While Burrows did not disclose specific financial details or the number of active users in the New Zealand market, she expressed satisfaction with the company’s business activity. DoorDash offers a white-label service that facilitates order delivery through participating restaurants’ own websites, as well as a picking and packing service for grocery partners. However, the majority of its business in New Zealand comes from its marketplace offering.

Burrows emphasized that DoorDash’s approach in New Zealand is focused on tailoring its service to local needs, stating, “We are building DoorDash for New Zealand, we’re not doing DoorDash to New Zealand.” The company aims to expand into other major cities following its Auckland launch, and it also envisions opportunities beyond food delivery, such as the delivery of other goods.

DoorDash is currently working on expanding its Auckland team, particularly in sales, marketing, and operations. While external support is currently being provided, the company plans to hire local talent as the business grows. Despite economic pressures, DoorDash has not witnessed a reduction in overall consumer spending or frequency of platform usage. In fact, some consumer groups are utilizing food delivery services more frequently as an alternative to other activities.

With around 10 times order growth since its Wellington launch in May 2022 and approximately five times order growth since its Christchurch launch in October 2022, DoorDash views its entry into the New Zealand market as a successful endeavor. The company remains committed to investing and is enthusiastic about the opportunities that lie ahead in New Zealand.

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