Name: Uber Eats: Why Thousands of Restaurants Are Being Cut from App | Tech News Briefing | WSJ
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This is your tech news briefing for Tuesday, March 28th.

I'm Zoe Thomas for the Wall Street Journal.

You're looking for something to eat on a delivery app and you come across several restaurants that all appear to be different, but all seem to have exactly the same food.

Well, on Tuesday, Uber eats is set to announce it's doing something about this.

It plans to take down about 5000 online only menus that represent about 10% of listings on the app in the US and Canada with me to discuss how things came to this point is our restaurant reporter Heather Hadden.

So to start off when we talk about multiple listings from one restaurant are these ghost kitchens, some of them can be, but often these are actually from real restaurants with a physical address and an actual door.

These are online only brands that a lot of restaurants started during the pandemic as a way to shore up their businesses when dine in seating was closed and it's basically run out of an existing kitchen.

It could be a ghost kitchen, but it's often at an actual physical restaurant where they're offering what's supposed to be a unique menu out of that restaurant for online app.

Or can you tell us a little bit more about why restaurants would choose to do this to have multiple listings and maybe give us some examples of restaurants that are doing it.

So again during the pandemic, when dining rooms closed, a lot of brands including established brands like casual dining restaurants like Chili's or Denny's or Ihop decided that they needed additional revenue to keep themselves afloat.

So at a restaurant like IHOP or Denny's often their kitchens are pretty slow in the evening even though they're 24 hour concepts.

And so they added these new unique brands that are serving burgers or grilled cheese or quesadillas to appeal to consumers, many of them younger than their typical demographic to order through apps and to have it delivered to them.

So they're using their kitchens, often they're using existing ingredients in their restaurants, but advertising and marketing it in a new way and offering a, a new and distinctive menu.

So tell us why Uber has made this decision to kick off around 5000 online only restaurants from its app.

So Uber and you know, a lot of the apps say this as well, that things just got really overheated amongst these virtual brands.

All these menus will come up and some of them are just the same menu under different names and emerging out of the same restaurant or from the same overall company.

And there's really no differentiation between them.

And so, you know, these apps say thousands of these have mushroomed and Uber Eats is taking very definitive action to clean up what they say has become a wild wild west out there of these virtual brands that they say that they need to call some of these just so their customers can really trust what they're ordering is an actual distinct restaurant with its own, you know, own food and own menu as opposed to a copycat.

Is there a big fight on the app for real estate space that they might take up or these virtual brands might be taking over?

I mean how you engineer search is a whole art these days and there's outside third party services that will help you and your search on these apps.

How customers actually discover your brand, you can pay consultants to make that even better.

You want to be on top, you want to be towards the top.

So when someone is hungry and scrolling you show up apart from just kicking off many of these online brands.

Are there any other rules that Uber Eats is bringing in?

So in addition to making sure the menus are distinctive, Uber Eats is also going to require that online brands list photos of five items that are unique to its menu.

Uber Eats will also take down virtual restaurants whose average ratings drop beyond a certain threshold.

And that's kind of similar to some what some of the other companies are starting to do.

Um, we talked to Grubhub who said it's also making sure that there's not too many brands stemming from one same physical address,

and making sure that orders and cancellation rates aren't too high from particular virtual restaurant before they would sanction them.

Yeah, I think for going online, you know, maybe it's also like online shopping these days.

You don't really know where it's coming from.

The National Restaurant Association actually did a survey and the majority of customers say they want to have food delivered from an actual place.

They want to know that there's some integrity to the listing and to the restaurant before they're eating the food.

So I think, you know, there's been some comedians that have spoofed this phenomenon, but I think for the regular customer, they just want to know what they're getting is, is real.

And that's it for today's tech news briefing.

But a quick note on A I before we close the show, we still want to hear your questions about generative artificial intelligence A I programs like chat GP T Microsoft's New Bing Search or Google's Bart.

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Or email us a voice recording to T N B at W S J dot com.

I'm Zoe Thomas with the Wall Street Journal.