Benzinga | Oct 12, 2021 11:34AM EDT

DoorDash Brings Ads To Search Results Pages: Report

DoorDash Inc (NYSE:DASH) has started selling restaurant advertisements that appear in the app's search results.

What Happened According to a Wall Street Journal report, the San Francisco-headquartered company has already enabled marketers to run advertisements highlighting free delivery and discounts. While DoorDash runs banner ads across most of its pages, this is the first time it is offering advertising above its search results.

Furthermore, DoorDash has created a platform that enables restaurants to purchase advertisement placements through a bidding system without the input of an ad-sales person. The restaurants only pay for their sponsored listings if users click through the ads and make orders.

"Any mom-and-pop shop can go in, set a budget, and we only collect dollars if they get a transaction," said Toby Espinosa, vice president for DoorDash Ads.

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Why It Matters: The Wall Street Journal noted that DoorDash does not publish how much of its revenue comes from ad sales, nor has it stated its goals from the new ad product. However, the new revenue stream created with this advertising opportunity comes at a serendipitous time.

DoorDash's second-quarter earnings report published in August found the company with $1.23 billion, up 83% from $675 million one year earlier, but it also recorded a net income loss of $102 million, down from a positive $23 million in the previous year.

DASH Price Action At last check. Tuesday morning, DoorDash stock was trading at $199.30, sandwiched between its 52-week range of $110.13 and $256.09.

Photo: DoorDash