Experiment specification

Experiment Spec: Order Batching Rollout Evaluation

Author: Staff Product Manager, Core Logistics Target Decision Date: 4 November 2026 (Rollout: 5 November; Peak Code Freeze: 6 November) Stakeholders / Sign-offs: COO, CFO, Head of Operations, Courier Relations Lead Informed: Head of Growth

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1. Executive Summary & Decision Framework

We are evaluating courier order batching (one courier delivering two proximate orders) across our 14 European markets (~1.9M monthly orders). Our goal is to determine whether to ship batching globally prior to the 6 November code freeze.

Go / No-Go Decision Criteria (Sign-off Contract)

Batching will roll out to all 14 cities on 5 November only if all four conditions are met: 1. Cost Efficiency (CFO & COO): Courier cost per order decreases by $\ge$ 5.0% (baseline: €7.40; target: $\le$ €7.03) at $p < 0.05$. 2. Customer Experience Guardrail (COO & Head of Ops): Share of orders delivered in >45 minutes increases by no more than 0.8 percentage points (baseline: 7.5%; ceiling: $\le$ 8.3%) with no statistically significant drop in order ratings. 3. Courier Welfare & Legal Compliance (Courier Relations & Porto Agreement): Courier earnings per active hour do not decline in any market (baseline: €13.20; target: $\ge$ €13.20, non-inferiority margin of 0%). 4. Leading Retention Indicator (Head of Growth): 7-day reorder rate exhibits no statistically significant negative degradation ($\alpha = 0.05$).

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2. Flaws in the Intern’s Draft & Required Fixes

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3. Experiment Design & Methodology

Design: Stratified City-Time Switchback

• Unit of Randomization: City $\times$ 2-hour window (11:00–13:00, 13:00–15:00, ..., 21:00–23:00 = 6 windows/day per city).
• Intervention:
• Treatment Window: Batching algorithm active (up to 2 orders per courier from nearby pickup points).
• Control Window: Pure single-order dispatch (status quo).
• Buffer/Washout: 15-minute dispatch transition buffer between blocks. Orders placed in the final 15 minutes of a window cannot be batched if the subsequent window is Control, eliminating spillover across windows.

Power & Sample Size

• Required Sample: 740 two-hour windows to detect a 5% shift in cost per order ($\alpha = 0.05, \beta = 0.80$).
• Capacity:
• 13 cities $\times$ 6 windows/day = 78 windows/day.
• Porto joins on Day 8 (15 October): 14 cities $\times$ 6 windows/day = 84 windows/day.
• Duration: 14 days (8 October – 21 October).
• 7 days $\times$ 78 windows + 7 days $\times$ 84 windows = 1,134 windows.
• This provides >150% of required sample, allowing high statistical power to detect sub-1% changes in courier hourly earnings and Ops tail-delays.

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4. Stakeholder Metrics & Success Criteria

``` +---------------------------------------------------------------------------------------+ | PRIMARY METRIC | | Courier Cost per Order (CFO/COO) | Target: >= 5% reduction (<= €7.03 vs. €7.40) | +---------------------------------------------------------------------------------------+ | +---------------------------------+---------------------------------+ | | | +------------------+ +-------------------+ +--------------------+ | OPS GUARDRAIL | | COURIER GUARDRAIL | | GROWTH GUARDRAILS | | (Head of Ops) | | (Courier Lead) | | (Head of Growth) | | >45m Late Share | | Courier Earnings | | • 7-day Reorder | | Baseline: 7.5% | | per Active Hour | | • Order Rating | | Ceiling: <= 8.3% | | Baseline: €13.20 | | • Missing/Cold Food| | Second-order ETA | | Floor: >= €13.20 | | Refund Rate | | impact: <= +5m | | (Non-inferior) | | | +------------------+ +-------------------+ +--------------------+ ```

Metric Definitions & Instruments

1. Courier Cost per Order (CFO): Total courier payout (base + distance fees + batch bonuses) divided by completed orders within the window. 2. Late Delivery Share >45m (Head of Ops): P90 delivery time and proportion of orders delivered >45 minutes from placement. Simulation projects a 3–6 min increase for the 2nd order; total late share must not breach 8.3%. 3. Courier Earnings per Active Hour (Courier Relations): Gross earnings divided by active hours (online and on-trip/assigned). Risk: Because couriers are paid per order + distance, batching two orders saves distance, potentially reducing payout unless batch base rates or drop-off multipliers offset it. 4. Customer Experience & Retention Proxy (Growth): * 7-day reorder rate for cohorts exposed to $\ge 2$ batched deliveries. * Delivery-related customer support contacts per 1,000 orders.

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5. Porto Compliance & Courier Safeguards

Our Porto agreement mandates a 14-day notice period for dispatch adjustments and guarantees that courier average hourly earnings will not fall.

• Timeline Action: Formal written notice delivered to the Porto Couriers’ Association on Wednesday, 1 October 2026.
• Phased Rollout: Porto remains 100% Control through 14 October. On 15 October, Porto enters the switchback rotation.
• Earnings Floor Mechanism: If average courier earnings per active hour in treatment windows drop below €13.20 in Porto (or any city), an automatic “Batch Adjustment Top-Up” will credit couriers the difference at end-of-day. This eliminates legal exposure while allowing us to evaluate the raw algorithm’s unit economics.

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6. Execution Timeline

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7. Circuit Breakers & Rollback Criteria

The experiment toggle will automatically shut down batching within 15 minutes if any of the following triggers trip during live operations: * Severe Operations Failure: City-level late delivery rate (>45 min) exceeds 12.0% across two consecutive peak windows. * Courier Backlash/Disruption: Courier unassigned order rate spikes by $>25\%$ or courier offline churn spikes by $>15\%$ compared to historical control. * Severe Food Quality Impact: Customer support contact rate for "cold food" or "late arrival" doubles ($>2.0\times$).

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8. Stakeholder Sign-Off

By signing below, stakeholders agree that if the primary and guardrail criteria in Section 1 are satisfied by 3 November, order batching will be deployed to all 14 cities on 5 November 2026.

• Chief Operating Officer: _________
• Chief Financial Officer: _________
• Head of Operations: _________
• Courier Relations Lead: _________

Order Batching Experiment Spec

Decision: Roll out batching to all 14 cities before the 6 Nov 2026 code freeze, or not. Owner: Staff PM. Sign-off: COO, CFO, Head of Operations, Courier Relations Lead. Head of Growth is copied in.

1. What changed from the intern's draft

2. Design

• Unit: city × two-hour window. The windows are 11–13, 13–15, 15–17, 17–19, 19–21 and 21–23, so six per city per day.
• Assignment: Within each city-day, the windows form three adjacent pairs. In each pair, one window is randomly batching-on and the other is off. This balances lunch, afternoon and dinner across arms and controls for city and weekday.
• Attribution: An order belongs to the window in which it was placed. The pre-specified sensitivity analysis drops orders placed in the first 30 minutes of each window, because in-flight batches and courier positioning carry over from the previous window.
• Exposure: Batching pairs only nearby restaurants, using the same rules the simulation assumed. The batching configuration is frozen before the test starts.

3. Duration and power

The analyst's figure of about 740 windows assumes windows are independent. They are not: adjacent windows share couriers and demand, and cities differ. I therefore treat 740 as a floor and plan for up to double that.

• Engineering needs one week, so the switch is ready on 7 Oct and the test runs Thu 8 Oct – Wed 28 Oct (21 days, three of every weekday).
• 13 cities × 6 windows × 21 days = 1,638 windows. Porto adds 6 × 14 days = 84. The total is about 1,720 windows, roughly 2.3× the floor.
• We do not stop early on a good-looking interim result. The end date is fixed.
• Analysis: A window-level regression on total cost ÷ total orders, with city and weekday × hour fixed effects and standard errors clustered by city-day. We will confirm with randomisation inference.

4. Metrics and decision rules

All four sign-offs are needed on these thresholds by Tue 6 Oct, before any data exist.

The COO's "without making customers wait noticeably longer" is operationalised as the +1.0 pp cap. The simulations add 3–6 minutes to the second order in each batch, so this cap is the threshold most likely to be contested. The Head of Ops should confirm or change it before the start.

Tension to surface: Cost per order is forecast to fall 6–11%, and couriers are paid per order plus distance. Earnings per hour therefore stay flat only if batching raises orders per courier-hour by at least as much as pay per order falls. The test settles this, and the CFO's and Courier Relations' metrics are not independent.

Secondary metrics (descriptive only): - Mean delivery time, and delivery time for the second order in a batch. - Share of orders batched. - Orders per courier-hour. - Customer support contacts. - Cancellations.

Reorder rate: We report the 7-day rate for test customers at the decision. The 30-day rate is tracked after rollout for customers by batched-order exposure, and it cannot be treated as causal. Growth should know this now.

5. Porto

• Written notice goes to the couriers' association today (30 Sept). Legal should word it to cover both the test and permanent rollout. The earliest compliant start is 14 Oct, so Porto joins the test on 15 Oct.
• The contract says changes must not reduce average hourly earnings. Porto therefore has a stricter rule than other cities: the estimated earnings difference must be ≥ €0 for Porto to ship.
• Porto has only about 84 windows, so its own estimate will be noisy. We pool it for cost and lateness. For earnings we report Porto separately, daily, with the stop rule below.
• If Porto fails or is ambiguous, we ship in the other 13 cities and keep Porto off. Legal should confirm that running the test in Porto does not itself breach the agreement. If it might, exclude Porto from the test and roll out there only on the pooled evidence plus the earnings rule.

6. Stop rules

The per-city switch lets us turn batching off immediately. Any of these triggers a pause in that city and a review within 24 hours:

• The >45-minute share in batching-on windows exceeds off windows by more than 3 pp over two consecutive days.
• Earnings per active hour in batching-on windows are more than 5% below off windows over three consecutive days. In Porto, the threshold is any sustained shortfall that the Courier Relations Lead judges real.
• Any safety or serious courier-welfare incident tied to batching.

7. Timeline

The 29 Oct decision leaves a week of buffer. If the test slips past about 2 Nov, there is no safe rollout before the freeze.

8. Risks and limits

• Seasonality: October demand is below peak. Higher order density should raise batch rates, but it also strains courier supply. We track batch rate by hour and expect the peak effect to differ from the test estimate.
• Carryover: Some carryover between windows will remain even with the 30-minute washout. The sensitivity analysis shows how much it matters.
• Short-run effects: Couriers may change their behaviour as they learn batching, and three weeks may not capture that. We monitor weekly trends within the test.
• Possible outcomes: The result can be a full rollout, a partial rollout (for example excluding Porto or any city that fails a guardrail), or no rollout. Partial rollout by city is allowed by the switch, but only for cities that individually pass the stop rules. City-level results will be noisy, so we do not make ship decisions city by city beyond this.

9. Sign-off

Brisk order-batching experiment spec

Decision required: Whether to enable batching in all 14 cities on 5 November 2026, ahead of the 6 November code freeze. Batching pairs two eligible orders from nearby restaurants for one courier.

Decision principles and sign-off

Launch only if the experiment shows a worthwhile courier-cost reduction, customer lateness stays within an agreed limit, and courier earnings protections are met. An inconclusive result is not a pass.

Before launch, the COO and Head of Operations must approve the customer-delay limit below; the courier relations lead and Legal must confirm the Porto protocol in writing. If those approvals or the schedule cannot be met, do not claim evidence for an all-city rollout before the freeze.

Design

Randomise city × two-hour operating windows, not individual orders. Orders interact through shared courier supply, and individual randomisation would contaminate the comparison. In each treatment window, the batching policy is enabled; in each control window, batching is disabled. Randomise and balance windows within each city, weekday and daypart, aiming for an even treatment/control split. Keep the assignment schedule fixed before the test begins.

An order is analysed according to its city-window at placement (intention to treat). Batch only orders placed in the same treatment window; do not pair across windows or with control orders. This limits cross-arm contamination at switchovers. Record actual batching eligibility and use, but do not reclassify orders based on whether they were batched.

Timeline and Porto condition

• 30 September: Send Porto’s couriers’ association written notice. The notice requirement applies to the experiment as well as any rollout. Start Porto treatment no earlier than 15 October, allowing 14 full days.
• By 7 October: Complete the per-city switch, monitoring, and rollback controls; test the assignment and cost calculations.
• 15 October–4 November: Run the experiment in all cities, subject to Porto approval.
• 5 November: Review results and, only if all launch gates pass, enable batching in all 14 cities in one day. Otherwise keep it off. Do not shorten the experiment to meet the freeze.

Porto must not enter treatment until Legal and the courier relations lead confirm the notice and trial protocol comply with the agreement. Agree a written earnings-protection mechanism with the association before starting; any top-ups count in courier cost. If this cannot be agreed, exclude Porto from treatment and do not describe the result as support for a 14-city rollout.

Measures and launch gates

Estimate treatment effects against control, with confidence intervals and pre-specified analysis. Baselines: courier cost €7.40/order, orders over 45 minutes 7.5%, courier earnings €13.20/active hour.

The proposed 0.5pp lateness margin and the earnings non-inferiority margin are policy choices, not facts in the brief; the accountable leads must sign them off before randomisation. Do not change margins after seeing results.

Analysis and power

The schedule contains 1,764 city-windows (14 cities × 6 windows/day × 21 days), before any exclusions. The analyst’s estimate of 740 assumes independent windows; successive windows may be correlated, and couriers and demand carry across time. Before the test, use historical city-window data and the planned randomisation to simulate power, accounting for serial correlation and city/daypart differences. Use blocked randomisation-based inference or an appropriate model with uncertainty at the randomised-window level. Do not claim the test is powered merely because 1,764 exceeds 740. If adjusted power is inadequate, or results are too imprecise to meet a gate by 5 November, the decision is inconclusive: no rollout before freeze.

Operations and rollback

Monitor treatment uptake, cost, lateness and earnings daily, but do not stop early for a favourable result. Pause a city for a safety, service or earnings breach under pre-agreed operational thresholds; document the incident and retain it in intention-to-treat analysis. Keep the city switch available for immediate rollback. Sign-off: COO, CFO, Head of Operations, courier relations lead; Growth acknowledges the delayed reorder readout.