Ritson: Despite Snoop and Katy, Menulog’s collapse was inevitable
Menulog will stop taking orders in two weeks, shocking 2.6 million Australians customers, 120 redundant headquarters employees, and thousands of couriers whose income depended on its bright orange promise. After twenty years as Australia’s homegrown food delivery leader, the only remaining domestic competitor closes its doors. And the sector slides almost entirely into overseas hands.
Staff will receive redundancy beyond the legal minimum. Couriers will get support payments. And a two-week transition window now allows customers to redeem any remaining credits. It is a dignified exit, and Morten Belling, the company’s Managing Director, hit all the appropriate notes with his closing statement: “difficult decision,” “challenging circumstances,” “proud history.” But beneath the corporate cliche sits a harder truth: Menulog was up against tough global rivals, its margins turned toxic, and exit became inevitable.
The brand’s significance shouldn’t be understated. This was an Australian innovation that predated both Uber Eats and DoorDash—a marketplace built by Australians for Australians at the precise moment when online food delivery was about to reshape how the country eats. It helped thousands of small restaurants flourish. It was, for better or worse, a genuine pioneer in the gig economy.
The company’s trajectory reads like a Harvard Business School case study in global disruption. Menulog launched in Sydney in 2006, scaled steadily from scrappy disruptor to household verb. Then was swallowed up in the fish-eating-fish scenario that defines modern capitalism. Menulog sold to UK-based Just Eat a decade ago. Just Eat merged with Dutch rival Takeaway.com five years later. Then the newly formed company was acquired by Dutch investment firm Prosus last year. What was once Australia’s category leader became a peripheral asset in a distant portfolio of a global corporation. Regional significance dissolved into a rounding error at the bottom of a giant spreadsheet.
Menulog’s most memorable marketing moment came at the start of the decade with a television and digital video blitz featuring Snoop Dogg. It was, technically, a re-edit of its sister brand’s European Just Eat campaign, but that detail hardly mattered. The campaign jacked up short-term awareness and maintained share. Katy Perry followed with similar vigor.
But food delivery marketing operates by brutal rules: you are only as valuable as last night’s salience score. While catchy creative helps, this is ultimately a category where monthly media budgets do most of the talking. Menulog needed to spend roughly $2 million every month just to stay ahead of DoorDash and on the coat tails of Uber Eats.
A company spending 10% of its $245 million annual revenue on advertising wouldn’t normally raise concern—plenty of healthy brands maintain a 10:1 advertising to sales ratio comfortably. But Menulog wasn’t healthy. Dig past revenue and the company was hemorrhaging between $2 and $4 million every month. At best, it broke even before advertising spend pushed it decisively and repeatedly into red. The platform wasn’t just losing market share. It was losing money on every order, every courier, and every dollar spent trying to remain competitive.
The reason can be traced to a single decision: Menulog formally employed its delivery drivers rather than treating them as independent “gig” contractors.
The distinction mattered enormously. Formal employment meant paying superannuation, minimum wage guarantees, portable leave, and worker injury insurance – a burden that added twenty to thirty percent to payroll costs. It meant managing hundreds of workers on fixed rosters and award rates. It meant technology and administrative complexity that contractors never demanded.
Menulog was not large enough to absorb these losses, unlike Uber Eats, whose parent company can cross-subsidise with billions earned in ride-share and other international businesses. Ultimately, Menulog’s approach sacrificed cost competitiveness and agility for worker protections—admirable ethically, but unsustainable commercially. The company’s closure is now a textbook warning for local firms caught between regulatory reform, global competitors, and a public divided on the future of gig work.
Ad once again we learn the pitfalls of brand purpose built from stated consumer surveys rather than actual customer behaviour. Every teen is incredibly concerned about the environment and ethics when asked about it by an attractive interviewer with a clipboard. But six hours later they still over order on Shein. Similarly, most Aussies are vehement supporters of workers’ rights and a Fair Go, until they have to fork out 34 cents more for their Chicken Burrito before Masterchef starts.
A 2023 survey by Sydney Business Insights found that 72% of Australian consumers support minimum wages for gig workers, 70% support workers’ compensation, and 65% support regulated hours and superannuation for gig employees. And 100% of this stated survey data misrepresents the actual appetite for ethics among the consumer population. Despite apparent public support and a Labour government, the decision not to exploit the gig economy cost Menulog dear.
So what’s left after Menulog bows out? Until this month the Australian delivery market fit perfectly into Boston Consulting Group’s “Rule of Three”. The theory states that mature industries tend to be dominated by three major players operating in a 4:2:1 ratio of market share. One clear leader, one challenger, and one follower, with smaller competitors struggling to survive.
In Australia, Uber Eats is the undisputed leader, with over 70% of market share, well ahead of Menulog (which until its exit held about 24%) and DoorDash (sitting around 15% and quickly expanding). These three have absorbed or eliminated smaller platforms, causing a flight of local competition and making the sector highly concentrated—just as the rule of three predicts.
With Menulog’s exit, however, the food delivery market becomes an effective duopoly, leaving only Uber Eats and DoorDash to battle for dominance and innovation. It’s a scenario our country is entirely used to having been essentially dominated by duopolies for decades across key sectors like supermarkets, media, automotive and department stores. But this is different. A new kind of 21st Century duopoly controlled by foreign multi-nationals rather than the traditional, long standing local incumbents that Aussies grew up with.
Big international brands, little home-grown competition. This matters for marketing, for pricing, for innovation, and for consumer choice. Market concentration inevitably leads to higher fees, less diverse advertising, and less incentive to serve local needs. The disappearance of Menulog brings echoes of Deliveroo’s withdrawal in 2022 and Foodora in 2018: international mergers push out the locals, reducing the diversity that led to explosive sector growth in the first place.
Ultimately, the Menulog story is a new chapter in the continued story of Australia’s market evolution. That branding and local energy must be coupled with commercial ruthlessness to survive global consolidation. Even then, the odds are squarely against local players as the death of distance and the gradual globalisation of every category takes hold. We are seeing the same story with retail, publishing, fashion, free-to-air and a host of other once safe, domestic commercial enclaves that used to benefit from being twenty hours and sixteen thousand kilometres away from the main action.
The end of Menulog isn’t just the end of a tech company, it’s the end of an era for how Australians think about digital convenience, competition, and the future of work. And it’s another example of how the structure of Australian competition is changing. That’s something worth chewing over—not just for marketers, but anyone with an appetite for tough business lessons.
Mark Ritson is a former marketing professor, brand consultant and award-winning columnist. He is also the founder of the MiniMBA in Marketing which runs again next April
