Meituan Ecommerce is the largest service-focused e-commerce platform in China, connecting 280 million annual active buying consumers to local merchants. This company has developed a wide range of services, including in-store dining, travel, and more. It also offers on-demand grocery delivery.
In October 2017, the company updated its strategy from a food and platform model to a retail and technology one. The new platform integrates a global retailing section into its main app. That section includes items from around the world, as well as skincare products, baby products, vitamins, and more. As a result, the company will focus on expanding into key target verticals.
A key benefit of the Meituan app is its ability to aggregate all of its services into one. In other words, it’s like an “Amazon of services”. Users can make payments and request specific services, and track the status of their requests.
Although the company is considered a late entrant to the e-commerce space, Meituan has been successful by combining platform and product features that other companies had previously developed. For example, it’s built a logistics and supply chain infrastructure, which helps it deliver items from one place to another in a cost-effective manner.
As part of its drive to become the largest service-focused e-commerce player in China, the company has recently been expanding its reach beyond its core dining business. By the end of 2018, Meituan had launched a ride-hailing service, a scooter battery replacement service, and a brand self-operated franchise store.
Meituan is also launching a direct sales channel for physical goods. This will allow cross-border merchants to sell their products outside of China. Using the Zhongcao model, which is similar to Instagram, users can leave positive reviews to nudge others to purchase. Using this model, the company aims to capture the physical goods e-commerce pie.
Meituan Ecommerce is not only focused on connecting consumers to local merchants, but also has a strong emphasis on empowering brands and local businesses. The company’s latest funding round included investment from Tiger Global Management, IDG Capital, the Priceline Group, and GIC. Other investors include Sequoia Capital, Trustbridge Partners, and the China-UAE Investment Cooperation Fund.
Meituan is leveraging its e-commerce platform to drive constant upgrades of its offerings. According to Bailian, the company’s gross merchandise volume could hit RMB 1 trillion in the near future. Despite the growing regulatory pressure on the e-commerce industry, the company is looking to diversify its revenue stream and increase traffic. Among its key initiatives, the company plans to improve order dispatch algorithms, optimize repurchase rates, and adjust route guidance algorithms.
To achieve its goal, the company is investing heavily in cutting-edge technology, as well as expanding its business into other sectors. For instance, it is building a nationwide cold chain logistics network, which will help it expand group buying in lower-tier markets.
Meituan Ecommerce’s vision is to be a comprehensive e-commerce platform, which will empower consumers, brands, and local businesses in China. At the same time, it will focus on strengthening market leadership in four key categories.
