clock menu more-arrow no yes

Filed under:

Yelp Funnels Users’ Calls Through Grubhub to Help Collect Widely Criticized Referral Fees From Restaurants

It’s only the latest instance of restaurants being frustrated with Grubhub’s profit-sneaking tactics

Yelp’s homepage.
AP
AP

In a class action lawsuit filed against Grubhub in January, restaurant owners complained that the third-party food delivery service was falsely charging them for orders every time they got a phone call. Grubhub did this by creating new numbers for the restaurants they partnered with, which rerouted to the restaurants’ existing numbers, but allowed Grubhub to monitor calls and charge if it was an order — though, as the lawsuit alleges, Grubhub often charged for calls on subjects beyond ordering. Now, it appears Yelp is also in on the scam.

In 2018, Yelp integrated Grubhub’s ordering capabilities into its platform, allowing users to place delivery orders straight from Yelp. And according to Vice, it’s also replacing restaurants’ real numbers with the reroutes from Grubhub in order to take a cut.

The sneaky bait-and-switch is presented as an option for the potential customer to either call for “General Questions” or “Takeout and Delivery” in the Yelp app. The “General Questions” number is the restaurant’s actual number, while “Takeout and Delivery” takes the caller through a Grubhub number, which tells the caller “This call may be recorded to ensure awesomeness” before connecting them to the restaurant. “Even though restaurants are capable of taking orders directly—after all, both numbers are routed to the same place—Yelp is pushing customers to Grubhub-owned phone numbers in order to facilitate what Grubhub calls a ‘referral fee’ of between 15 percent and 20 percent of the order total,” writes Vice.

A spokesperson from Yelp told Vice “It is our understanding that Grubhub has marketing agreements with some restaurants that allow Grubhub to utilize referral numbers on third party partner sites like Yelp.” When previously called out for their shady tactics, like setting up fake websites for existing restaurants, Grubhub says it’s all allowed in the fine print, the agreement being that setting up alternate phone numbers and websites is allowed under Grubhub’s “marketing” services. Eater reached out to Grubhub for more information on how the Yelp partnership falls into its “marketing” agreements, but did not receive a response by press time.

Overall this is just one more drop in the bucket that is both customers’ and restaurants’ increasing frustration with third-party delivery services and the gig economy, with even one New York City Council member getting involved involved. Perhaps it’s time to return to the take-out menu.

Correction: August 12, 2019, 8:30 a.m. Reporting on Yelp was originally conducted by the podcast Underunderstood.

Sign up for the Sign up for the Eater newsletter

The freshest news from the food world every day