By Tony Xu, co-founder, and CEO
Today, we’re sharing more details about the changes we’re making to how earnings and tipping will work on DoorDash — changes that we believe will allow DoorDash to better serve both Dashers and customers.
We developed this approach with input from customers and Dashers, including members of our Dasher Community Council. We have been testing the new model this month and refining the details based on feedback we’ve received from Dashers. We’ll continue to make improvements as we roll it out to all Dashers next month.
Under this model:
Dashers will earn more money on average — both from DoorDash and overall.
Every dollar customers tip will be an extra dollar in their Dasher’s pocket, and customers will be able to tip at checkout or after the delivery.
Dashers will continue to see all of the details of each order upfront, so they can make an informed decision about which deliveries they want to accept. They will also continue to receive a detailed breakdown of their earnings after each delivery.
How it will work
Here’s a detailed look at how Dasher earnings will work:
Base Pay
Under this new model, base pay from DoorDash to Dashers will increase and will range from $2-$10+ per delivery depending on the estimated duration, distance, and desirability of the order. Deliveries that are expected to take more time, that require Dashers to travel a longer distance, and that are less popular with Dashers will have higher base pay.
Promotions
Dashers will also have the opportunity to earn more through promotions. Promotions will include Peak Pay and Challenge Bonuses that we plan to roll out in the coming months. When it’s busy, Dashers can earn extra money on each delivery through Peak Pay, and Challenge Bonuses will better reward more active Dashers and help them meet specific earnings goals for the week.
Tips
Every dollar customers tip will be an extra dollar in their Dasher’s pocket, and customers will be able to tip at checkout or after the delivery. The amount DoorDash pays in base pay and promotions will never vary based on the tip amount. Tips left at checkout will be shown as part of the Dasher’s guaranteed earnings when the Dasher is offered a delivery, and any tips provided after the delivery will also be added to the Dasher’s earnings.
Our guiding principles
As we developed this approach, we were guided by three key principles:
Every customer should feel like their tip matters. Under our old model, DoorDash would boost pay if a customer left little or no tip. Although boost pay was intended to help Dashers, we recognize that it also had the unintended effect of making some customers feel like their tips didn’t matter. Under our new model, every dollar a customer tips will be an extra dollar in their Dasher’s pocket. If you leave a $3 tip on your order, your Dasher will earn an extra $3.
Dashers should earn more money on average, both from DoorDash and overall. To help offset some of the variability in this new model, DoorDash is increasing the amount that we pay on average through base pay and bonuses, which will increase overall Dasher earnings. This commitment is incredibly important to us, which is why we’ll be working with an independent third party to ensure that Dasher earnings under this new model increase.
Dashers should know the details of each order upfront so they can make an informed choice about which deliveries to accept. Dashers will continue to see the name of the restaurant, the pickup and delivery location, the total mileage, the estimated delivery time, and their guaranteed earnings before choosing whether to accept or reject a delivery. Guaranteed earnings are the sum of DoorDash base pay, promotions, and the tip the customer leaves at checkout. Dashers will continue to see the breakdown of their earnings once the delivery is complete, including tips provided at checkout or after the delivery. Below is an example of what Dashers will see.
Since this topic has attracted so much attention, both among our users and the general public, I want to say a little more about why we made the decisions we made.
Why change now?
The decision to change our model was difficult. We initially resisted change even in the face of public pressure because we built our model in direct response to feedback from Dashers. When we rolled out our model in 2017, an overwhelming majority of Dashers told us that they preferred it, and in the years since, we’ve seen meaningful improvements in overall Dasher satisfaction and retention. We thought we were doing the right thing for Dashers by making them whole if a customer left no tip, but the feedback we’ve received recently made clear that some of our customers who were leaving tips felt like their tips didn’t matter. We realized that we couldn’t continue to do right by Dashers if some customers felt we weren’t also doing right by them. To ensure that all of our users have a great experience on DoorDash, we needed to strike a better balance.
Will the new model be better or worse for Dashers?
Under our new model, Dashers will earn more money on average — both from DoorDash and overall. We know there will be greater variability in total earnings from order to order, so we are taking steps to address that to make sure that Dashers will earn more on average. We understand the importance of consistency for those who depend on our platform to help achieve their financial goals each week, so we’re going to increase average pay from DoorDash to help mitigate this effect. This means overall Dasher earnings will rise. We’ll also enable customers to tip after they receive their delivery. We hope that by maintaining transparency and increasing pay, Dashers will have a better overall experience.
