Global tech

SLAPDASH: Food delivery giant DoorDash served up $2m fine for more than 1 million spam messages

- August 16, 2023 2 MIN READ
DoorDash delivery
Photo: AdobeStock
Food delivery platform DoorDash has copped a $2,011,320 penalty from the communications regulator for sending more than one million texts and emails in breach of Australian spam rules.

The NSYE-listed tech company, which launched aggressively in Australian in 2019 amid complaints from restaurateurs that they’d been signed up to the platform without their permission and knowledge, was investigated by the Australian Communications and Media Authority (ACMA) following complaints from customers and others looking to become delivery drivers.

The regulator found that between February and October 2022, DoorDash sent more than 566,000 promotional emails to customers who had unsubscribed from these messages, along with more than 515,000 texts without an unsubscribe facility to prospective drivers.

ACMA chair Nerida O’Loughlin said spam compliance is an ongoing priority and it’s frustrating when people who took the time to unsubscribe still receive messages.

“It is unacceptable that DoorDash’s prospective contractors were sent messages without an unsubscribe facility about a business opportunity that they may not have wished to pursue,” she said.

The ACMA investigation concluded DoorDash had mischaracterised texts sent to prospective contractors as being solely factual in nature, and thus outside the scope of spam rules. However, they featured offers and incentives to promote a business opportunity to drivers.

“When messages include this kind of content they are considered commercial under spam rules and must include an unsubscribe facility,” O’Loughlin said.

“DoorDash is a large business conducting high-volume marketing so there is no excuse for non-compliance. This is a further warning to all businesses that engage in email and SMS marketing that now is the time to review your spam compliance.”

As well as the fine, the US tech busines agreed to a three-year court-enforceable undertaking to engage an independent consultant to review its compliance with spam rules and to make improvements where needed, as well as reporting regularly to the ACMA.

A spokesperson for the company said the breaches of the 20-year-old Spam Act were mistakes and “technical errors” they’ve fixed.

“DoorDash remains committed to working with all parties to best serve our customers and Dashers, and takes seriously its legal obligations under the Spam Act and all applicable laws,” they said

“The investigation was the product of Dasher onboarding communications that were mistaken for transactional messages and a technical error in our consumer messaging system that has since been remediated.”

The year so far has not gone to plan for the company, which last November, amid the failure of several food delivery companies, launched DashMart offering supermarket items in three eastern states capitals amid plans to roll out 29 more sites in 2023.

But by April this year, just days before the collapse of Milkrun,  the dream was over, and the stores were shut down, with the loss of 11 jobs.

Earlier this month, DoorDash launched in six regional cities in NSW, South Australia and Queensland.