When 50 billion subsidies were smashed into takeaways, the daily order was a record of 220 million, but in exchange for rider collapse, merchants closed stores, and users complained: JD.com stopped at 20 million, Taobao soared 80 million, and Meituan held 70% – who burned the chips first in this money-burning game?
“Is the takeaway war going on, I’m almost diabetic.”
July 5 this year will undoubtedly go down in the “history” of the instant retail industry. On this day, Meituan’s daily order volume exceeded 120 million, and Taobao flash sale delivered more than 80 million orders; the total number of orders in the entire market was as high as 220 million, doubling compared with the beginning of the year.
Behind the seemingly abnormal explosive growth is the large subsidies thrown by the platform. In the first half of this year, JD.com and Alibaba successively entered the takeaway market, attracting new users to place orders through huge discounts; Many netizens mentioned that they relied on coupons issued by JD.com and Taobao to drink Luckin and Mixue Bingcheng, which were “purchased for 0 yuan”.
Source: Screenshot of Xiaohongshu
Subsidies continue. On July 12, the “takeaway war” topped the hot search, and catering stores once again exploded. Taobao flash sale, which claims to come up with a subsidy of 50 billion yuan, maintains 80 million orders, and JD.com has proposed a “double hundred plan” after the “10 billion subsidy”, and is expected to invest more than 20 billion yuan in the field of takeaway.
Meituan, which made efforts in the end, did not give specific subsidy data, and hurriedly responded to the battle but finally handed over 150 million instant retail orders.
Why did JD.com and Taobao, the two major e-commerce giants, take a fancy to the “hard business” of takeaway this year, forcing Meituan, which has always been restrained, to sit still? How much market share can the “loss-making subsidies” that the new platform cannot see will tear off?
01 JD.com “can’t make up for it”?
Before the giants entered the market, Ele.me and Meituan’s share in the takeaway market remained around 37. Ele.me was acquired by Alibaba for seven years, with a continuous loss of more than 100 billion yuan, but after JD.com’s high-profile entry into takeaway this year, Alibaba seems to have “woken up”, since JD.com APP can directly order takeaway, why can’t Taobao APP directly launch the takeaway entrance?
Two months after JD.com entered the takeaway game, Taobao Hourly Delivery was upgraded to “Taobao Flash Sale”. The upgraded Taobao flash sale, relying on the merchant resources and capacity accumulated by Ele.me over the years, has soared all the way, from 40 million orders at the end of May and 60 million orders at the end of June to 80 million on July 5.
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On the other hand, JD.com’s daily order volume seems to have begun to stagnate after reaching 20 million at the end of May. According to a report by “LatePost”, on July 5, the record-breaking day of the industry, JD.com’s daily delivery was still about 20 million orders, almost a quarter of Taobao’s flash sale. It is conceivable that some users who won JD.com takeaway at low prices in the early days may also “defect” to Taobao flash sales because of low prices.
The rapid rise of Taobao flash sales is due to the supply and transportation resources of Ele.me’s merchants on the one hand. Over the years, Ele.me has covered most of the restaurants and stalls in every city, while JD.com is still dominated by chain dine-in restaurants, and some chain catering brands have not settled in JD.com even in some low-tier cities.
Chen Ming (pseudonym), who lives in the counties around Shijiazhuang, Hebei Province, found that he wanted to order KFC and McDonald’s burgers during the takeaway war last weekend, but found that he could not find it on JD.com. Many netizens on social media platforms also said that they had the same experience.
Source: Screenshot of Xiaohongshu
In the field of non-meals, Taobao flash sales and JD.com are also vigorously expanding merchants. “Qujie Commerce” noticed that most of the daily necessities on the two platforms currently come from convenience stores and supermarkets, as well as some brand offline stores.
Some secondary market participants have analyzed that Taobao flash sales will have a unique attraction to brand merchants, especially its advantageous shoes and clothing categories. Brands can live broadcast coupons for offline stores on the Tmall flagship store, and consumers place orders through Taobao flash sales, receive the goods within one hour, and if they are not suitable, the return and exchange will be very fast.
In addition to limited supply, JD.com’s gradually decreasing subsidies have also given Taobao flash sales the opportunity to “overtake”. Recently, some netizens have said that there are fewer large discounts on JD.com, “I have to pick Cudi wool on JD.com every day, and I won’t let me pick it today.” Many merchants also said on social media platforms that JD.com’s new subsidy activities have been borne by merchants more.
Source: Screenshot of Xiaohongshu
Some milk tea merchants once told “Leifeng.com” that the order subsidy on the JD.com platform was almost halved in June, “now the milk tea category is 10 yuan minus 7 yuan coupons, merchants pay 4 yuan, JD.com subsidizes 3 yuan, and when JD.com takeaway first started, the subsidies were all issued by the platform.” Now Taobao flash sales with 50 billion yuan are gaining momentum, and JD.com has become the initiator of a new round of takeaway subsidy war.
Subsidies can indeed boost user activity in a short period of time, but it is difficult to bring long-term stickiness and repurchase. In the face of the siege of giants, Meituan, as the “industry boss”, did not choose to defend with large subsidies. “Fun Solution” learned that Meituan’s recent subsidies for catering takeaway are still very restrained, and only in the last two weekends have responded to Taobao flash sales with blitzkrieg, and the market share of meal orders has remained at about 70% since June.
Under the “stable development”, Meituan’s instant retail orders exceeded 150 million last Saturday, exchanging appropriate discounts for a new transaction peak. In last week’s battle report, it also revealed a new round of direction in the takeaway war – not only disclosing the number of orders, but also emphasizing the stability of performance and commodity categories.
Source: Screenshot of Weibo
Meituan emphasized that its average delivery time is 34 minutes, and Ele.me not only said that the delivery punctuality rate is 96%, but also specially supplemented the previously lacking catering data – although the absolute value and proportion were not disclosed, but the growth trend was highlighted. In contrast, it can be seen that the takeaway war is not all about price, in addition to low prices, there are many factors that affect the experience of users placing orders, such as the stability of performance and the richness of categories, which is likely to be the key to determining the outcome of the takeaway war.
02 E-commerce giants rekindle the “takeaway war”
Since the beginning of the year, there has been endless news of giants “scuffling” in the food delivery industry. In addition to enjoying low prices, ordinary consumers can’t help but wonder: Why do e-commerce platforms take a fancy to Meituan’s business? Even Duoduo is planning an “instant delivery” business.
Seeking new growth can be said to be the common goal of Alibaba and JD.com to enter the takeaway. Taotian Group and JD.com’s revenue in 2024 increased by 3% and 7% year-on-year, respectively; In recent years, the growth rate of the main business of these two traditional e-commerce platforms has slowed down, and they are trying to improve the retention and conversion of users on the site.
Takeaway, especially catering takeaway with high consumption frequency and strong repurchase, is undoubtedly a good drainage entrance. Liu Qiangdong, founder of JD.com, bluntly said in a recent exchange, “The money we lose in takeaway is still more cost-effective than the money we spend on Douyin and Tencent to buy traffic.” ”
Source: Screenshot of Weibo
When Alibaba acquired Ele.me in 2018, it had already divided “far-field retail, mid-field retail, and near-field retail” within the company, and the purpose of this Taobao flash sale was to use “near-field” to drive “far-field”. Recently, some Taobao employees told “36Kr” that the investment target of 50 billion yuan is not only catering orders, but also to see a significant increase in retail orders.
Taobao wants to increase consumption through takeaway, and JD.com wants to do instant retail through takeaway, which has essentially become an e-commerce battle; Users who buy JD.com takeaway with subsidies can also be easily bought by Taobao, and the subsidy efficiency is higher. From a business point of view, Ele.me’s users and resources can be transferred to Taobao; In contrast, JD.com’s mentality in catering delivery needs to be established from 0.
Yao Qi, an analyst who is deeply concerned about the takeaway war, once told “Leifeng.com” that it is more difficult for JD.com to occupy the minds of users, which is equivalent to recreating a brand, and it takes a long time and a lot of subsidies and mental washing for new brands to want consumers to “get excited”. Yao Qi believes that Taobao hopes to replace takeaway with flash sales, but this requires a lot of subsidies and long-term persistence, otherwise it is difficult to solidify and change consumers’ original takeaway mentality.
“Fun Solution” noticed that in addition to catering, both platforms also cover clothing and 3C digital, which are the basic plates of Alibaba and JD.com’s e-commerce business. The takeaway dispute has extended to the offline instant retail dispute; However, there is still a question mark over whether takeaway traffic can flow smoothly into the e-commerce business and whether high-cost subsidies can be exchanged for high-value users.
Source: JD.com, Taobao screenshot
The three platforms of Meituan, Taobao and JD.com have adopted different styles of play according to their own characteristics. Zhuang Shuai, an expert in the retail e-commerce industry, believes that Meituan’s takeaway mentality is very strong, local life services have supply advantages, as well as the increasingly strengthened self-operated front-end warehouse model (Little Elephant Supermarket, Crooked Horse Wine Delivery, etc.) and the scale advantage of the platform lightning warehouse, and the future needs to make up for the physical e-commerce part; Taobao’s advantages lie in its online operation capabilities, user scale and e-commerce merchant scale, while taking advantage of Ele.me’s supply and instant delivery advantages in the catering field, as well as Alibaba’s resources in AI technology; The core of JD.com lies in its self-operated supply chain capabilities, and the current supply in the fields of catering and local life needs to be improved.
03 Instant retail cannot rely solely on subsidies
Following the peak of orders on July 5, the large subsidies issued by the platform on July 12 once again made many catering stores “explode”. Some takeaway riders said that the merchant’s meal service was much slower than usual from the morning; There are also some tea shops that have just opened in the morning and have to close the takeaway entrance because they are too busy.
Source: Screenshot of Weibo
JD.com launched a 16.8 yuan crayfish eating activity, and Taobao flash sales large coupons were distributed from the morning…… The two-week subsidy war shows the determination of Alibaba and JD.com to seize market share.
According to the “LatePost” report, Alibaba internally named the 100-day growth plan of Taobao flash sales as the “Huaihai Campaign”, rushing orders every Saturday, and concentrating the company to try to create a “crazy Saturday” in the field of takeaway. This is reminiscent of the “Double 11” and “6.18” promotions in the e-commerce industry.
Almost crazy subsidies have almost exhausted the production capacity of popular restaurant stores. At present, the takeaway price war was initiated by JD.com, Taobao flash sales followed up, and Meituan was passively involved; However, whether it is JD.com’s 10 billion subsidies or Taobao’s 50 billion subsidies, most of the subsidies are chain merchants, but small and medium-sized merchants are passively involved in the price war and sacrifice profits.
Source: Screenshot of Xiaohongshu
More importantly, the low-price limited-time promotion was originally an e-commerce gameplay, but is this marketing method really suitable for time-sensitive and localized instant retail?
Zhai Wei, executive director of the Competition Law Research Center of East China University of Political Science and Law, believes that the carnival-style food delivery platform subsidy war has the risk of causing market competition to fall into low-level and low-price competition. The purpose of Taobao and JD.com is to drive online e-commerce with local retail, but it is not easy for takeaway users attracted by low prices to effectively convert into e-commerce business.
Yao Qi believes that the conversion rate of takeaway users attracted by Taobao flash sales is a key indicator. “Assuming that after the final discovery of the subsidy, Meituan will also subsidize, and the share of both sides will not rise or fall, and at the same time, in the mobile Taobao, if the subsidized users of tens of millions of single milk coffee food orders every day buy and leave, they will not expand their purchasing power in the mall, and the offline 30 minutes of non-meal shopping orders will not grow rapidly – when such a scene crosses, the subsidy value may be revalued by Alibaba.”
Sometimes, when a user buys a takeaway, there are many experience factors in addition to considering the price. Since the start of the “takeaway war”, there have been many posts on social media complaining about Taobao flash sales and JD.com’s slow delivery and poor service attitude, “JD.com often delivers the wrong meal, asking me to go to other floors to get food.” “Can Taobao flash sale ensure capacity before doing activities, two of the three times will be delivered for an hour and a half.”
Source: Screenshot of Xiaohongshu
Takeaway cannot always have large subsidies, and whether the process from order to receipt is smooth is the key to affecting repurchase; This also means that the investment in the field of takeaway is a long battle to improve the supply network, fulfillment infrastructure and platform functions of merchants, and how to reasonably allocate capacity during the run-in with merchants and peak orders…… Meituan has done quite mature after 15 years of hard work, while Alibaba and JD.com still need to gradually improve or even accumulate from scratch.
Some practitioners have mentioned that the explosive traffic online may not be a good thing for stores, because the carrying capacity of offline stores is limited, and there is no traffic but no corresponding goods and services, and everything is in vain. Similar problems need to be solved one by one by platforms that are deeply involved in instant retail, which cannot be done quickly. In contrast, Meituan has a certain supply and performance moat in years of run-in and exploration, and whether the new platform is willing to bend down to pay attention to these offline corners remains to be seen.
