How Amazon Prime subscribers can get Grubhub Plus free for a year

May 2024 · 3 minute read

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Amazon Prime subscribers will receive a free food-delivery perk after the e-commerce giant took a stake in Grubhub as part of a deal announced Wednesday.

Amazon revealed the promotion as a headline deal for its annual “Prime Day” sales event. Prime members who sign up for Grubhub+ through an Amazon portal receive unlimited free delivery on orders above $12 as well as discounts and other perks.

Grubhub’s subscription service normally costs $9.99 per month.

Shares of rival food delivery services plunged on news of the partnership. DoorDash’s stock fell 7.4%, while Uber shares declined 4.5%.

Grubhub+ service is available in more than 4,000 cities and provides access to meal ordering from hundreds of thousands of US restaurants, according to Amazon. Existing Grubhub+ subscribers can also redeem the offer for a free year.

The deal represents a lifeline for Grubhubs’ Netherlands-based owner Just Eat Takeaway, shares of which have plunged about 70% so far this year. As recently as last week, Just Eat Takeaway said it was “actively exploring” a potential sale or strategic partnership for GrubHub.

“Competition is increasing across the board and JustEat looks like they have buyer’s remorse and it needs to find strategic partnerships to boost Grub’s positioning,” Wedbush Securities analyst Dan Ives told The Post.

The European conglomerate “is absorbing what could be a sizable number of delivery fees,” Ives said, adding that it’s “a necessary step to access the Amazon Prime fortress of consumers.”

It’s also not the first such deal for Grubhub, which inked a one-year partnership with grocery delivery company Instacart in November. Under the terms of that deal, Instacart + members get one year free of Grubhub’s premium membership program, giving the restaurant delivery company access to Istacart’s members.

“Amazon has redefined convenience with Prime and we’re confident this offering will expose many new diners to the value of Grubhub+ while driving more business to our restaurant partners and drivers,” GrubHub CEO Adam DeWitt said in a statement.

Just Eat Takeaway said its partnership with Amazon was “expected to expand membership to Grubhub+, while having a neutral impact on Grubhub’s 2022 earnings and cash flow, and be earnings and cash flow accretive for Grubhub from 2023 onwards.”

Under the agreement’s terms, Amazon will receive a 2% stake in Grubhub – with an additional 13% stake obtainable if the deal hits key performance targets, including driving an unspecified number of new customers to the platform.

Shareholders have questioned the European delivery giant’s ability to achieve profitability at Grubhub or successfully sell the US-based subsidiary after buying it for $7.3 billion, Reuters reported.

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