At the beginning of the year, JD.com announced its entry into the takeaway industry, and many people will be curious, how could JD.com, an e-commerce company, think of entering the takeaway industry? In this article, let’s take a look at the inevitability of the author’s analysis.
At the beginning of 2025, JD.com announced its entry into the takeaway industry in a high-profile manner, giving merchants free of charge, giving riders five insurances and one housing fund, and Brother Dong personally came on the field, creating momentum for the development of new business.
The food delivery industry has high risks, high entry barriers, and high exit barriers, but the yield is very low (industry profit margins are generally less than 3%), which is a more tasteless field. Why did JD.com cut into takeaway?
Is it an active attack, but why doesn’t JD.com attack other areas? Is it a passive defense, but JD.com has a wide business layout and many competitors, how can Meituan’s flash sale be worth the strength of the whole company to counterattack? Some people also say that it is strategic synergy, but what business synergy and how to collaborate? Some people also say that it is traffic anxiety, but the entrance with the largest traffic at present is not takeaway (the largest traffic entrance is social and short video). These factors sound right, but they always miss the core.
Let’s talk about the conclusion first: JD.com has a comprehensive layout in the field of commodity circulation and has formed a complete self-operated industrial chain, and the larger its business volume, the more it can give full play to its scale advantage and reduce the cost of unit commodity circulation, so the expansion in the field of commodity circulation is determined by its genes. The rapid growth of the market share of instant retail is a battlefield that JD.com does not want to lose and cannot lose. But the instant retail business cannot exist alone, because this is a low-frequency scenario, which is bound to be hit by the dimensionality reduction of the high-frequency takeaway business, so if you want to get instant snacks, you must take takeaway first!
After the conclusion, if you are interested, you can take a look at the detailed discussion process~
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This article attempts to construct a global perspective from the perspective of products and provide an analytical framework, firstly, to explore the essential reasons for JD.com’s entry into the field of takeaway, and secondly, based on this analysis, predict which fields JD.com may enter in the future. Of course, I also hope that this article can help you establish your own analytical framework, when other new views or information enter our field of vision, we can correspond them to the position in the frame, or update our framework structure to ensure that we always grasp the overall perspective and avoid a one-sided understanding that listening to the wind is the wind and listening to the rain is the rain.
JD.com’s main business is based on the circulation and sales of goods, let’s first improve a dimension, jump out of JD.com’s business, from the perspective of social operation, look at the life journey of the commodity, that is, a commodity from scratch, from the production line to the hands of consumers, the path that needs to be roughly experienced. Without further ado, let’s go straight to the picture above:
In the first step, brand owners need to design product solutions that can meet our needs in a certain scenario based on user needs and current technical level, and carry out brand promotion to stimulate consumers’ willingness to buy
The second step is to entrust the design plan to the factory for manufacturing
In the third step, the distributor transports the goods from the factory to the retail terminal
In the fourth step, the retailer sells the goods to the seller to achieve capital recovery
At this time, we open each process and look at it, and we can locate the main business base camp of JD.com, as shown above:
As shown in the figure, in the circulation and transportation link, it is mainly divided into two models, one is the layered distribution model, and the other is JD.com’s self-operated model, avoiding the inefficient system of hierarchical distribution and setting up warehouses at different levels to achieve efficient circulation of goods.
In the retail transaction link, its retail terminals are mainly offline stores and online stores, and offline stores are divided into in-store business and home business, and online stores have two forms, one is JD.com’s self-operated portal, and the other is the portal operated by third-party merchants.
Above, we will give a general understanding of the link of commodity circulation, and then move on to the topic.
For JD.com, a complete warehousing and logistics system has been established, and the larger the business volume, the more prominent its scale advantage is, so maximizing its market share is an inevitable behavior determined by JD.com’s genes. At this time, we focus on the instant retail business, which has maintained a rapid growth trend in recent years, with a compound annual growth rate of about 30%, and is expected to reach 2 trillion yuan in 2030 (source “Instant Retail Industry Development Report”), while the growth rate of China’s total retail sales of consumer goods is only 3.5% (source “i.e. Economic Daily”). In other words, under the premise that the total retail sales volume of the society is fixed, the channels of retail terminals are bound to be a zero-sum game, one and the other. A large part of the trillions of increments in instant retail comes from other retail channels (as shown in the figure above, in-store business and online business), which will greatly erode JD.com’s market share. In the face of such huge market opportunities and threats, JD.com, which has expansion genes, cannot stay out of the matter. Therefore, JD.com must participate in the competition for this trillion-dollar market.
In fact, JD.com has already laid out in the field of instant retail – Dada. Dada has 1 million+ rider resources, entrusting merchants on one hand and users on the other, realizing a closed loop of business. Speaking of which, is it very familiar, yes, the business model and takeaway are the same, the similarity of the two business models, so that the theory of high-frequency and low-frequency is effective at this moment, high-frequency takeaway, to the low-frequency instant retail has made a perfect dimensionality reduction blow, and in the multilateral business model of merchant-rider-user, following the logic of winner-take-all, the more users, the more merchants, the lower the rider distribution cost, the higher the profit of the enterprise, the enterprise has sufficient resources, subsidizing the three parties, Thus completing a new round of market expansion.
The data also proves this, with Meituan’s instant delivery orders reaching 18.7 billion in the first three quarters of 2024, a year-on-year increase of 18%; Alibaba’s quarterly results released in September 2024 showed that the revenue of Local Life Group increased by 14% year-on-year, but under the conditions of rapid market growth, Dada’s performance bucked the trend, with net income of about 9.664 billion yuan in 2024, down 8% from the previous year. Therefore, in the industry where high-frequency plays low-frequency and winner-takes-all, the ultimate destination of low-frequency business is out.
So, is it okay for JD.com not to do takeaway? Yes, at the cost of sacrificing the fast-growing instant retail market. When instant retail occupies a sufficient share of retail terminals, leading companies in this field will inevitably adopt a vertical integration strategy to expand into circulation and transportation, and at that time, JD.com’s main business will be eroded
Therefore, JD.com’s takeaway is not only a need for defense, but also a need for strategic expansion.
Next, relying on the SWOT model, briefly discuss the feasibility of JD.com doing takeaway:
Advantage:
1. Traffic side advantages: Dongge’s personal brand advantages, high consumer groups on JD.com’s main website;
2. Supply-side advantages: the existing instant distribution network of Dada Group
3. System synergy advantages: Many supply chain systems can be directly reused in the takeaway business (such as users, orders, merchants, payment, risk control, data analysis, etc., this is the editor’s professional field, and another version of the system reuse article will be published another day)
4. Capital advantages and technical talent advantages
Disadvantages: Lack of catering business foundation, lack of user mentality, high performance costs, and system scheduling algorithms need to be improved
Opportunity: Users’ demands: merchants have been suffering from Meituan for a long time, riders have been suffering from Meituan for a long time, and consumers have been suffering from Meituan for a long time; Market growth: The scale of instant retail is expected to exceed 2 trillion yuan in 2030, and policy advantages: The anti-monopoly law constrains Meituan from further expansion
Threats: The threat of existing players in the industry (Meituan, Ele.me platform ecology and user mentality have been formed), and the threat of new players in the industry (Douyin, Kuaishou and other high-traffic platforms need to lay out local life services, but it is difficult for this kind of traffic platform to form a strong strategic synergy with the takeaway business, and it is basically not their choice for takeaway such as high exit barriers and low yields)
Obviously, Dong Ge adopts the SO strategy, using its own advantages, holding high, entering strongly, seizing the market, and after occupying a certain market share, the disadvantages and threats will gradually decrease
Next, let’s discuss another topic: In addition to takeaway, what other areas is JD.com likely to expand into? First of all, the picture above:
Based on the above figure, in order to expand its market share, JD.com may increase its retail market share, expand offline stores to achieve store business, and may also provide supply to online third-party merchants or offline stores in order to increase its circulation market share. It is also possible to implement a vertical integration strategy, with rich user data, directly intervene in the product design link upstream, define product standards, and this strategy has been completed in China by Fat Donglai and Sam’s in China, if JD.com uses its own supply chain advantages to promote high-standard and low-price products to the whole country, it is not a new strategic direction (Jingzao is currently trying this direction, but has not yet been promoted to a strategic height)
In addition, another thinking question for everyone to discuss:
The reason why JD.com has strongly entered the high-frequency takeaway business is because of the rapid growth of instant retail in recent years, so what is the logic behind its growth? If we can discover the driving factors behind it based on social, economic, policy and other dimensions, it is possible to find better solutions than instant retail, thereby opening up a new business world. This is a very interesting topic, and I look forward to having the opportunity to discuss it with you again in the future!
