DoorDash Just Ended Its Partnership With Walmart. Here's What That Means
DoorDash began as a much-needed food delivery service at a time (2013) when restaurant delivery was spotty in many areas, including in Northern California, where the service first rolled out (via The DoorDash Story). But, the founders of DoorDash had a bigger vision. They wanted to become a "local, on-demand FedEx" type of service, one that would deliver not only restaurant food but also items from retail stores, including groceries and pet supplies (via DoorDash Story and DoorDash blog). In fact, in 2021, DoorDash rolled out "double-dash," which the DoorDash blog describes as allowing customers to secure the delivery of products from more than one store in their local area. But before that, DoorDash had already been delivering grocery store items from Walmart to customers since 2018 (via Walmart press release), as well as other items available at the big box department store.
The Walmart/DoorDash joint venture launched first in Atlanta with a goal of reaching 40% of American households. By April 2022, the Walmart/DoorDash partnership was available in 45 states, per Ridester. In fact, Ridester claimed that "the Walmart partnership is one of DoorDash's most popular delivery destinations." Whether or not there's truth to that, the fact is that DoorDash has now officially come to the conclusion that the partnership is "no longer mutually beneficial," according to an inside source who spoke to Insider on the condition of anonymity. In early August, the delivery service notified Walmart that it would be discontinuing the four-year-long partnership, via Bloomberg.
DoorDash isn't the only delivery service available to Walmart and its customers
Walmart announced the end of its partnership with DoorDash via email on August 19, according to Bloomberg. But that, in no way, leaves Walmart customers without delivery options. According to Insider, Walmart's agreement with DoorDash wasn't exclusive; just months after Walmart entered into the partnership, it was already testing out its Spark Delivery service — named for Walmart's iconic spark logo. The Spark delivery platform is still going strong, according to a Walmart spokesperson who told Insider, one day before the DoorDash breakup was announced, that the Spark platform is Walmart's "largest delivery-service provider," accounting for three-quarters of Walmart deliveries to 84% of U.S. households and covering all 50 states.
On that same day, August 18, Walmart revealed to Insider that it's in the process of acquiring the company, Delivery Drivers Inc., which has already been supporting the Spark platform by matching gig workers with customers in need of delivery. Although DDI has ended its relationship with non-Walmart stores, per another Insider story, Walmart will continue to work with multiple logistics providers to secure delivery of its products throughout the U.S. That last point may actually speak to DoorDash's dissatisfaction with Walmart of late. So too may the deal Walmart struck in July to acquire 4,500 electric delivery vehicles from Canoo, with an option to buy up to 10,000 (via Progressive Grocer). And, so too may Walmart's launch of drone deliveries back in May, (per Walmart).