Innovation & Tech

Olo Launches Consumer App Without Menu Markups for Food Orders

Olo entered consumer food delivery with a no-markup app, claiming 15% to 30% per-item savings. Only 27% of American adults know about menu markups, Olo’s study says.

By Amara Osei

3 min read

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Uber Eats and DoorDash Have a New Rival — Here’s What It Won’t Charge You ForJESHOOTS-com / pixabay

What's News

  • Olo launched its namesake consumer app this week for takeout and delivery orders.
  • Olo claims customers can save 15% to 30% per item versus similar platforms.
  • Only 27% of American adults are aware of menu markups, according to an Olo-commissioned study.
  • Olo cites existing relationships with Waffle House and Frank Pepe’s in New Haven, Connecticut.
  • Olo moved from business-to-business ordering software into a consumer-facing platform.

By Amara Osei

Digital commerce company Olo launched a consumer ordering app this week without marking up menu prices and says customers can save 15% to 30% per item versus similar platforms. The launch puts Olo into competition with Uber Eats and DoorDash while extending a business built around restaurant ordering software into the consumer market.

The app carries Olo’s name and accepts takeout and delivery orders from national chains and local restaurants. Olo previously operated behind the scenes as a business-to-business supplier of takeout ordering systems to chains. Its consumer app now gives diners a direct route into Olo’s existing restaurant relationships.

What changes for customers?

Olo says Uber Eats and DoorDash add markups to menu items, while its app does not. The company’s savings claim centers on item prices, not the total restaurant bill. Customers can still choose takeout or delivery and can order from a national chain or a local restaurant in the same app.

The launch extends Olo’s restaurant software business into a consumer channel for ordering relationships the company already manages. It gives Olo a direct brand presence with diners and a new way to compete for consumer orders.

How large is the savings claim?

Olo says users can save 15% to 30% per item compared with similar platforms. The company attributes the gap to existing relationships with restaurants including Waffle House and Frank Pepe’s in New Haven, Connecticut. Olo describes the range as a per-item comparison, not a discount on every restaurant bill.

That gives Olo a specific price proposition against the rival platforms it identifies. The announcement makes no broader claim about delivery or service fees.

Why would restaurants support the model?

“Ordering food should be simple for guests and fair for the restaurants that serve them,” said Corey Kline, EVP of technology at Noodles & Company, in Olo’s press release. The statement ties diner simplicity to restaurant fairness. It presents both the customer experience and the merchant’s economics as central to Olo’s pitch.

How aware are consumers?

Olo commissioned a study that found consumers generally expect delivery fees when ordering food online. The research found that only 27% of American adults are aware of menu markups. Because Olo commissioned the study, its awareness figure comes from research tied to the party selling the solution.

Olo frames that disparity as an opening for a clearer consumer offer. Its app presents no item markup and claims 15% to 30% per-item savings. The 27% finding measures awareness, not demand for an alternative.

What does the launch mean for Olo?

The launch moves Olo from a behind-the-scenes software role into a consumer-facing platform. Previously, the company built takeout ordering software for restaurants; now diners can use Olo’s app for takeout and delivery. Olo is therefore competing with Uber Eats and DoorDash at the point where customers select restaurants and items.

The app’s initial case rests on three elements Olo put forward: no menu-item markups, claimed per-item savings of 15% to 30%, and availability across national chains and local restaurants. The company also points to the 27% consumer-awareness rate as the market gap its model seeks to address.

For restaurants, the pitch offers a direct ordering channel under the stated goal of fairer pricing. For diners, the immediate proposition is menu-item prices without the markups Olo attributes to rival platforms. Olo’s launch does not state that delivery or service charges are waived.

For Olo, the next test is whether diners will switch for a clearly stated per-item price advantage. Restaurants face a separate test: whether a direct channel can deliver the fairness that Noodles & Company’s Corey Kline described in Olo’s launch release.

Original: businesswire.com

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Amara Osei

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Senior reporter covering companies, deals and strategy in entrepreneurship, startups and venture funding at Business Bearings.

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