From Bytes to Bites: Examining the Online and Offline Spillover Impacts of Online Food Delivery Platform Subscriptions

With the rapid expansion of online food delivery (OFD) platforms, subscription models have emerged as a strategic tool to retain users and shape consumption behavior. Despite their growing prevalence, the broader impacts of these subscriptions—both within the OFD sector and across downstream consumer activities—remain underexplored. Leveraging a difference-in-differences approach and a large-scale individual-level transaction data set, we identify a significant shift in consumption from a competing platform to the focal platform following the introduction of a subscription service. This shift did not result in cannibalization; instead, overall food consumption within the OFD market increased. Geospatial analysis shows that subscribers were more likely to engage in offline spillovers, including increased local dining and activity in nearby noncompeting economic sectors. These patterns suggest that subscriptions in physical services, like OFD, not only reshape digital engagement, but also, they influence consumer mobility and stimulate localized economic ecosystems. Mechanistic testing supports the interpretation that these effects are driven by increased variety-seeking behavior for offline restaurants that predominantly serve non-OFD cuisines within a proximal location, suggesting that such behavior is constrained by transportation costs. Overall, this study offers novel insights into how subscription models in physical service platforms can expand market demand, foster crosschannel engagement, and generate positive spillovers in adjacent sectors. The findings offer actionable guidance for platform designers and policymakers to enhance consumer welfare and support local economic vitality. They also provide new evidence for restaurants that additional platform usage costs may be offset by latent economic benefits from heightened consumer engagement.

This paper was accepted by D. J. Wu, information systems.

Funding: F. J. Costello acknowledges funding by Fundação para a Ciência e a Tecnologia (UID/00124/2025, UID/ PRR/00124/2025, Nova School of Business and Economics DOI: https://doi.org/10.54499/UID/00124/2025), UID/PRR2/00124/2025: DOI: https://doi.org/10.54499/UID/PRR2/00124/2025 and LISBOA2030 (DataLab2030 - LISBOA2030-FEDER-01314200).

Supplemental Material: The online appendix and data files are available at https://doi.org/10.1287/mnsc.2025.00954.