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GrubHub is buying web domains for the restaurants it lists

Labeled as legal in Domain Industry News started by EZPZYO, Jun 28, 2019.

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  1. EZPZYO

    EZPZYO Hack IT Crack IT VIP

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    The views expressed on this page by users and staff are their own, not those of NamePros.
  2. NameDeck

    NameDeck Design. Develop. Deploy. VIP

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    "we have registered domains on their behalf, consistent with our restaurant contracts. We no longer provide that service and it has always been our practice to transfer the domain to the restaurant as soon as they request it."

    Sure, sounds legit to me :)
     
  3. MS-Domains

    MS-Domains Top Member VIP

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    incredible story..

    There's more to it I think.. who knows...
     
  4. EZPZYO

    EZPZYO Hack IT Crack IT VIP

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  5. TCK

    TCK NameOptions.com VIP ★★★★★★★★★★

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    Apparently GrubHub and their subsidiary registered over 24,000 domains. They are mostly of smaller mom-and-pop restaurants that haven't yet registered their domains or versions of registered restaurant domain names, including those available in other extensions. Here is the entire list:

    https://docs.google.com/spreadsheets/d/1m9vszEQ9A13tN4AFRXWXVKZamRpQFIltP452wSqAvFM/edit#gid=0

    It seems to be an effort to rank better for people searching for those restaurants and divert traffic that would otherwise land on the actual restaurant sites, if they had one already. For example, some restaurants registered domains that are not great and include the city in the domain. Meanwhile their name remained available without the city name at the end, that GrubHub reg'd. So it was just an exploitation of those restaurants' lack of Internet/domain savvy.
     
    Last edited: Jun 29, 2019
  6. TCK

    TCK NameOptions.com VIP ★★★★★★★★★★

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    According to the referenced article, Grubhub official statement is:

    "Grubhub has never cybersquatted, which is identified by ICANN as 'generally bad faith registration of another person's trademark in a domain name.' As a service to our restaurants, we have created microsites for them as another source of orders and to increase their online brand presence. Additionally, we have registered domains on their behalf, consistent with our restaurant contracts. We no longer provide that service and it has always been our practice to transfer the domain to the restaurant as soon as they request it."

    I can't think of any mom-and-pop restaurant that would register a trademark, unless they are planning to go corporate with a national chain. So that statement is ridiculous.
     
  7. jamesall

    jamesall Member VIP

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    Did they tell the restaurants that they were doing this?

    I wonder if they have opened up for a huge lawsuit or 3.
     
    Last edited: Jun 30, 2019
  8. TCK

    TCK NameOptions.com VIP ★★★★★★★★★★

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    Not so, according to the original story. But if the restaurants found out and asked for those domains then Grubhub would transfer them for free. Grubhub did not disclose that to their clients prior to registering the domains.

    This was such a dumb idea. I don’t know if Grubhub leadership got bad advice from their IT head or ad agency, or it was all theirs.
     
    Last edited: Jun 30, 2019
  9. jamesall

    jamesall Member VIP

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    I don't know how Grubhubs terms and conditions reads but competing and impersonating with the customers own website (to ensure their commission) is the absolute crappiest thing I ever heard of. I wonder how they want the customers to respect them.

    This will hurt them.

    Time to find a new com name for the new competitor that takes over. If I had money in Grubhub I would be worried now.
     
  10. TCK

    TCK NameOptions.com VIP ★★★★★★★★★★

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    Just to give you a comparison. I run a Web development biz and have a client that uses a ccTLD domain. When I found out that a .net became available of their exact name, I let the client know so they could acquire it. The client declined but said if I wanted to, it would be fine by them. I responded that as policy we don’t register domains that include our clients’ business names, and/or are trademarks.

    I knew that sooner or later, if we develop that name or sell it to a competitor, it would result in bad blood.

    It is beyond me that a company the size and with the number of clients as Grubhub couldn’t see that logic. It comes down to pure greed.
     
    Last edited: Jun 30, 2019
  11. offthehandle

    offthehandle . Gold Account VIP

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    This is sleazy. If the ranking provides a lead, a 30% commission based on their customers brand/domain name registration, the restaurant owners ignorance of SEO or brand protection and the non restaurant phone number and imposter website tricks customers.

    https://newfoodeconomy.org/grubhub-domain-purchases-thousands-shadow-sites/

    Pro Bono Legal services offered to restaurant owners.
    https://mobile.twitter.com/i/web/status/1145082115077414914

    “So egregious and such a scam. My law firm will provide pro bono representation to any restaurant affected that wants to reclaim their #domains. Do spread the word, we’re serious about helping.”

    https://www.theverge.com/2019/6/28/...-fake-restaurant-domain-names-commission-fees

    Grubhub is using thousands of fake websites to upcharge commission fees from real businesses
    They also list phone numbers that don’t belong to the actual business”


    https://fourweekmba.com/grubhub-business-model/
    Business model. NYSE listed.
     
  12. jberryhill

    jberryhill Top Member John Berryhill, Ph.d., Esq. VIP ★★★★★★★★★★

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    In all probability, the contract that the restaurant signs with Grubhub expressly grants Grubhub a license in the restaurant’s mark that is broad enough to do that.

    Grubhub’s response mentions their contract, and it is unlikely that they wouldn’t have provided themselves the right to do it in the contract.
     
  13. EZPZYO

    EZPZYO Hack IT Crack IT VIP

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    Catch 22
     
  14. TCK

    TCK NameOptions.com VIP ★★★★★★★★★★

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    They may be protected legally but it still looks very bad. How many mom-and-pop shops have actually read the contract? Plus their fake sites look very amateurish.

    https://www.dnplaybook.com/big-domain-fail-for-grubhub/
     
    Last edited: Jul 2, 2019
  15. IMEZI

    IMEZI Top Member VIP ★★★★★★★★★★

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    It's their SHAREHOLDER who greedy enough to trespass the ethical line
     
  16. Gube

    Gube Established Member

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    I'm currently working on a restaurant booking platform in Belgium and I did something similar to improve my visibility in search results but also restaurant's visibility.
    But restaurants are able to update the content we display on their site and they pay a lower commision on bookings made via their website (compared to the platform)
    By the way, Takeaway .com does the same

    Gube
     
  17. TCK

    TCK NameOptions.com VIP ★★★★★★★★★★

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    It’s one thing that Grubhub needs to show profit and growth. It’s another whether the shareholders were aware of this practice. This certainly was not the way to go about it.
     
    Last edited: Jul 2, 2019
  18. domainer111

    domainer111 Established Member ★★★★★★★★★★

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    wow this is one of the biggest stories of the year!

    It's big because it's the non-domainer community talking about domains.

    On the plus side, at least it's highlighting the power of domain names.

    On the negative side, there is the cloud of cybersquatting hanging over it.

    Here's what stocktwits.com had to say about it in their morning eMail:

    ============================
    Grubhub Accused of Getting too Hungry
    Grubhub has allegedly bought some 23,000 domains posing as websites for businesses the delivery company either works with or is pitching—without those businesses’ knowledge, according to New Food Economy.

    What that looks like: When you order cookies to cure your Chernobyl-induced anxiety, you might end up on a Grubhub-owned site that looks just like the page of your local sweet tooth fix, order form and all. But Betty's Bakery had nothing to do with the website.

    FYI, Grubhub denies the so-called “cybersquatting,” saying the sites it owns boost orders and do restaurants a favor.

    But restaurants are up in arms, suggesting Grubhub’s misleadingcustomers who want to circumvent the service and its fees.

    • Grubhub, which is the largest online ordering platform in the U.S., charges restaurants a 3–15% commission fee on regular orders. Orders on Grubhub’s shadow sites can add a fee of up to 20%.
    Zoom out: When did food delivery get so cutthroat? When other services (like Uber Eats, with its gross bookings of $3.1 billion in Q1) started coming for Grubhub’s crown.

    ===================
     
  19. carob

    carob Top Member VIP ★★★★★★★★★★

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    Grubhub ate my name!
    What a story. If they hand it over to you, you get a free domain. But as for bad faith, if they intended to profit from the domain at your expense- think diverting business for increased commission - then it would indeed be a bad faith registration

    Story says they have stopped buying domains, but that does not stop them setting up webpages on a domain of their choice that still outrank the restaurant's own site in search.

    So when is Grubhub going to start delivering cannabis edibles?
     
  20. offthehandle

    offthehandle . Gold Account VIP

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    I fail to see any good faith in this sort of business practice. Grubhub should offer to build out mini sites, require restaurants to pay yearly or say a 5 year domain registration paid directly to the registrar to control their own domain name by these business owners before even contracting with them. It should be up front full disclosure and if restaurant objects to paying, then they should not be allowed on the platform and were advised.
     
  21. EZPZYO

    EZPZYO Hack IT Crack IT VIP

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  22. Gube

    Gube Established Member

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    They probably used an api to find all the domains (and register them)
    Or their program made a list of domains and an human reviewed them before "throwing 8$ on every domain"
     
  23. TCK

    TCK NameOptions.com VIP ★★★★★★★★★★

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    The domains were registered over the period of at least 8 to 9 years, maybe longer. There could have been some automation involved but it would likely go through human review.
     
  24. EZPZYO

    EZPZYO Hack IT Crack IT VIP

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    It would be cool to see if NameBio, Drop Catch or GoDaddy Auction has any historical sale data on these domains.

    Do you know of any tools that can check sale history of 22k+ domains with one click?
     
  25. DnameAgame

    DnameAgame Check out the new BrandPlease.com Gold Account

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    It's funny & tks for the article - i was scratching my head as I gotten a a few of low-ball offers on restaurant related domains. What wasn't weird was getting an occasional offer on 1 of them - but several at the same time was confusing. Who knows, the names I'm referencing are pretty good, but def. small (mom/pop) type names -maybe it was them. I have made counter offers, but will let you know if ones sells - &if there is no NDA/privacy required - I'll share.

    P.S. there were all offers through Sedo, where I dont actively list anything - make offers only on Sedo.
     
    Last edited: Jul 2, 2019

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