Doordash's Strategic Expansion into Local Services: How 'Going Out' and In-Store Rewards Can Drive Retention and Monetization

DoorDash's recent foray into local services through its "Going Out" initiative marks a pivotal shift in the company's strategy, moving beyond food delivery to capture a broader share of the dining experience. By integrating in-store rewards, reservations, and exclusive offers, DoorDash aims to deepen user engagement while unlocking new revenue streams. This analysis evaluates how these innovations address retention challenges and position the company for long-term growth in a competitive market.

User Retention: From Delivery to Full Dining Experience

DoorDash's first-time user retention rate has declined from 40% to 25% in the past quarter, according to DoorDash's Going Out announcement, a concerning trend exacerbated by aggressive competition and UI changes. However, the "Going Out" feature introduces a compelling value proposition to reverse this trajectory. By offering in-store rewards averaging $9 per order, DoorDash incentivizes repeat visits and fosters loyalty, particularly among DashPass members who gain access to exclusive tables and additional perks as described in the company announcement.

The program's impact is already evident: 80% of users who engaged with "Going Out" visited a restaurant they had never ordered from before, which not only drives foot traffic for restaurants but also creates a feedback loop where users return to DoorDash to discover and redeem new offers. The integration of SevenRooms further enhances this dynamic by providing enriched guest profiles and AI-driven tools for managing reservations and events, improving the overall user experience.

Monetization: Expanding Revenue Streams

While DoorDash's Q1 2025 revenue hit a record $3.03 billion, a CBS News report noted that the company's financial reports remain silent on the monetization of in-store rewards. However, the strategic value of "Going Out" lies in its ability to generate long-term profitability. By collecting detailed guest data through SevenRooms, DoorDash can refine its targeting for personalized offers, increasing the lifetime value of users. Restaurants, in turn, benefit from higher foot traffic and customer acquisition, creating a mutually beneficial ecosystem described in the DoorDash announcement.

The feature also opens new revenue avenues. For instance, in-app reservations in cities like Miami and New York could introduce subscription-based models for restaurants seeking priority visibility. Additionally, the program's focus on DashPass members-already a key driver of recurring revenue-aligns with DoorDash's goal of converting casual users into premium subscribers.

Challenges and Opportunities

Despite these advancements, DoorDash faces hurdles. The recent retention decline highlighted in the company announcement underscores the need for continuous optimization of the user onboarding process and UI design. Moreover, the absence of explicit financial metrics for "Going Out" in quarterly reports, as noted by the CBS News report, underscores the importance of monitoring long-term adoption rates and restaurant partner satisfaction.

However, the broader market context remains favorable. With 42 million active users in 2024, according to Business of Apps data, DoorDash's scale provides a strong foundation for scaling "Going Out" to additional markets. The company's ability to adapt to competitive pressures-such as rival platforms offering aggressive promotions-will depend on its capacity to innovate beyond delivery and solidify its role as a comprehensive dining platform.

Conclusion

DoorDash's "Going Out" initiative represents a bold reimagining of its value proposition, transforming the platform from a delivery service to an end-to-end dining companion. By leveraging in-store rewards, reservations, and advanced data tools, the company addresses retention challenges while diversifying its revenue streams. While short-term hurdles persist, the strategic alignment with user and restaurant needs positions DoorDash to capitalize on the evolving local services market. Investors should closely monitor adoption metrics and financial disclosures to gauge the program's long-term impact.