Text | New Position Pro
Within two months, Alibaba sold two offline retail assets, Intime Department Store and Gaoxin Retail, as another progress in its shrinking branch and focusing on its main business.The concept of new retail seems to have been completely swept into the old paper because of this, but the transformation of the retail industry by Internet thinking and technology has left traces, which does not mean that platforms with e-commerce as the backbone will give up their exploration of this field.
On February 11, Ele.me Chairman Wu Zeming announced the latest organizational adjustments of Ele.me through a company’s full staff letter: From now on, Wu Zeming will serve as Ele.me CEO. Han Liu, the former CEO, focuses on the real-time logistics center and continues to report to Wu Zeming.
Ele.me was once the loss-making head of Alibaba’s local life business, but since Yu Yongfu took over in 2021, its operating efficiency has continued to improve. After the “old three years” sorting out and integration, it was taken over by the Young Pioneer in 2024 and 10 The strategic direction of the “New Three Years” was announced in the month. In short, on the premise of ensuring stable growth of home delivery business, instant retail and the instant logistics network behind it will be pushed to the front desk and play the role of the second growth curve.
In this internal letter, Wu Zeming also emphasized that the adjustment of management division of labor is to consider“The strategic significance of instant logistics as Ele.me’s second growth curve continues to rise.”Before Han Liu took over the CEO last year, he served as senior vice president of Ele.me, head of instant retail business, and president of Hummingbird Instant.
Now, instant retail has become a hot word again.According to data from the National Bureau of Statistics and industry, from January to August 2024, the growth rate of domestic instant retail scale was 26.2%, far higher than the growth rate of 3.4% of the total retail sales of consumer goods and 8.9% of the online retail sales.
The platform is building positions, the brand is deploying omni-channel, and even offline supermarkets have joined the trend of business changes. In December last year, Walmart China announced a strategic cooperation with Meituan, launching stores across the country, and connecting them to Meituan delivery.
Platforms holding the key asset of delivery are once again at the forefront, andFor Ele.me, which regards the just-passed 2024 as the dividing line, we must stick to the map of catering home, and the city of “non-meal delivery” must plan.
01. The fierce takeaway has become a “hand-to-hand battle”
Data from the China Internet Information Center shows that the number of online takeaway users in my country has reached 545 million, accounting for about 50% of the total netizens. Since the development of the catering home track, the market structure has been highly stable, and the competitive barriers of the leading platforms have long been built; similarly, consumer behavior has been basically established.
According to iMedia Consulting, among the factors that Chinese consumers value when choosing takeaway platforms in 2024, 41.96% of consumers choose platform products prices and interactive discounts, 38.11% choose platform merchants quantity and quality, and 34.62% choose delivery fees, out of usage habits. Choosing a takeaway platform is ranked behind these three items.
Under this situation, grasping the “high frequency and low conversion” has almost become the only competitive area that remains highly active.Latepost reported that in the second quarter of last year, Meituan shifted its first priority from pursuing GMV to order growth. The adjustment background is that the platform has continued to decline in average customer prices, which in turn leads to a decline in GMV.
One background interspersed here is that, with the current overall consumption habits, takeout is more of a “daily urgent need” than an “occasional enjoyment”. In 2024, more than 30% of consumers ordered takeout food 5-10 times a week, and another 23.25% of consumers ordered takeout food 3-4 times a week. Affected by the consumption environment, achieving convenient diet at a lower price is the choice of most consumers.
Based on the above background, Ele.me launched a “super-hot” low-priced channel at the end of last year, occupying the most eye-catching recommendation position on the App homepage, focusing on “high-priced products”. In the consumption field with low customer unit price and high repurchase rate, “weakening the brand and highlighting the platform”, and the traffic exposure with a single popular SKU has a greater impact. This model has a certain “style” of Pinduoduo.
Takeaway is a market with solid demand, and merchants have less room to provide differentiated products. Catering to price-sensitive people may be the most realistic and easiest choice. butMeituan is currently going further in this regard.“God-hot-seeker” was launched in March 2023 and was quickly given a large amount of traffic support and was also embedded in the live broadcast column; the group takeaway product “Pinhaofan” repeatedly refreshed the daily order peak last year and quickly became the sword of Meituan to sink to the point of falling. The number one signboard in the market.
Both takeaway products are both strong intervention models of the platform, and they also focus on low prices, but the price range of Pinhaofan is lowered because the path to achieving low prices has reached the supply chain link. The general method of using twisting towels to reduce costs and prices by orders, packages and unified delivery.
In contrast, being popular or super popular is more like a limited-time special sale marketing campaign. Whether it is “stocking first and then using” or “stocking first and then giving”, the platform first uses activities to lock in demand, which facilitates merchants to achieve more refined supply and demand allocation. So we can see that most of the merchants participating in such activities are chain brands.
The New Position believes thatFollowing the current market demand for “high frequency and low consumption” is one aspect. In the catering business, if Ele.me goes to the “heavy” model of deepening the supply chain, it is contrary to its conscious contraction of business and focusing on the core in the past three years. of.
According to “LatePost”, in 2023, Ele.me will focus on about 40 first- and second-tier cities. Some low-tier cities that are at a disadvantage in market share have given up their direct sales and switched to lower-cost agency service providers.
However, judging from the general background of the market size of the takeaway industry, the takeaway market in first- and second-tier cities is becoming saturated. iMedia Consulting Report shows that the future growth momentum will mainly come from third-tier and below cities and townships, and the sinking market is becoming an important source of incremental growth for the takeaway industry.
It is also because Ele.me can find a limited increase in catering delivery now.It needs to open up new worlds of instant retail more than other local life platforms.
02. The “light and heavy” route of instant retail
E-commerce experience tells usThe binary judgment of the market for consumption upgrading/downgrade is actually not enough to summarize the overall consumption environment, and “hierarchical demand” is also applicable in the local life field.If low-priced takeaway products such as “super-hot” are “sinking” planning made by price-sensitive users, then many non-meal delivery projects with certain premium capabilities represent the upgraded side of instant retail consumption.
“Buy it and get it” is a leading concept of the retail model, and changes in consumption habits, technological progress and logistics innovation are indispensable. Therefore, there is a certain degree of “dislocation” in the perception of instant retail and its development trajectory. Previously, the forward warehouse model was repeatedly questioned by the market, believing that it was impossible to achieve an impossible triangle of user scale, customer unit price and fulfillment cost.
When this misalignment is aligned, the reputation will be reversed. Taking Dingdong Maicai as the node, instant retail has gradually become a distinctive science, and forward warehouses have naturally become the focus of the focus.
In the past, we usually divided instant retail into platform model and self-operated model. The former represents Meituan, Ele.me, and JD.com. Through matching transactions and offline performance, we play a typical role in Internet platform; the latter represents Dingdong Buy. Cuisine, Sam’s membership store, Hema, etc. have their own supply chains and offline warehousing, and the form is also subdivided.But at present, platforms are moving closer to supply chain construction and increasing their forward positions.
At the instant retail industry conference in October 24, Meituan described its lightning warehouse business as the current number has exceeded 30,000 and the goal is to cover all categories. It plans to exceed 100,000 by 2027, and the market size will reach 200 billion yuan. . Lightning warehouse is another highly coordinated business of the platform. It allocates the cost of building a warehouse through the franchise system and activates the supply of more commodities. During the same period, JD.com also began to deploy forward warehouses.
Against this background, Ele.me still chose a lighter route. It was also at the Instant E-commerce Future Business Summit in October last year that Ele.me’s plan for its Instant Retail business was “official flagship store of near-field brands”, which defined the scope of cooperation for brand merchants, delegated more operational autonomy, and the platform It is still positioned as a relatively “simple” matchmaking trading role.
What the platform is good at is opening up new scenariosfor example, in addition to the traditional daytime consumption period, the service period is extended to night and even early morning. According to Ele.me statistics, night convenience store orders account for as much as 35% of the whole day. In the report jointly released with Nelson IQ, Ele.me continued to refine this scenario into “24-hour warm consumption throughout the day in winter.” In December, during the night consumption of Ele.me platform, orders for nourishing and health products increased by 21% month-on-month, and fruit products increased by 28% month-on-month.
However, the platform needs to build a cycle of “user scale – batch demand – merchant supply” to form a traffic barrier and drive the cart of instant retail. Ele.me’s online planning is currently relatively clear, but it involves the “last mile” of offline terminal management and connecting with logistics networks, and it has not answered the question of supply accuracy for the time being.
Another factor that needs to be considered is that local life platforms are moving closer to e-commerce, and e-commerce is also extending towards local services. Taobao has sufficiently abundant merchant resources, and Taobao HD was also given higher weight last year.
Ele.me’s plan for the same Alibaba business is to complement it and seek common development.Whether it is multi-point collaboration to activate the ecosystem; or internal horse racing and positioning conflicts, it also depends on Alibaba’s subsequent review of the instant retail business of each platform.
03. Write at the end
Since the Internet thinking has entered the retail industry, new concepts have emerged one after another, and there are indeed some concepts that are entangled in the word “retail”.
On the one hand, the “physical store + supply chain” model of traditional retail has been impacted. On the other hand, emerging models such as new retail and instant retail have continued to expand their boundaries in the retail industry, blurring the original clear classification.
One clue that can be identified is that takeaway connects the development path of instant retail. In 2015, the market size expanded rapidly, and the surging traffic flowed into this industry, giving birth to a series of local life platforms and the fulfillment teams they cultivated.
Now the instant retail market is on the rise again, but the overall situation is still in the stage of setting up the scene. Once a new channel for near-field commodity circulation is established, there are still many problems that need to be solved urgently, such as what does the new competition revolve around, price, product or experience differentiation?
But what is certain is that the future retail industry is no longer a general business that caters to the overall consumption tendency. Platforms continue to dismantle demands and meet them in layers, and will continue to expand the boundaries of retail concepts.
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