A HIPPO AND A LITTLE ELEPHANT WILL BATTLE OVER INSTANT RETAIL

A few quotes from recent articles by instant retail expert Lao Zhang:

"Eleme has lagged behind Meituan for many years. Why did Alibaba suddenly launch Taobao Instashopping? A significant reason is the rapid growth of instant retail. Instant retail means everything is delivered to your home. It has gone beyond the scope of catering and is already encroaching on the e-commerce market of JD and Alibaba."

"Meituan has launched Instashopping, and its sales of categories such as computer office, wine, and adult products have exceeded JD's entire site. In Shenzhen and Beijing, Meituan's instant retail orders have exceeded one million per day, and the number of orders in Shenzhen has exceeded JD's entire Shenzhen site."

"JD and Alibaba were worried that if they allowed Meituan's flash sales to continue to develop, it would endanger the basic foundation of e-commerce, so JD launched a food delivery war, and Alibaba later joined the war."

"The competition between Alibaba and Meituan is ultimately a competition of operational capabilities, efficiency, and user experience, rather than a competition of subsidies."

"In 2019, Eleme's "Go to the Mountains and the Countryside Campaign" surpassed Meituan Takeout in some cities, but then Meituan regained the market."

"If Alibaba challenges Meituan, it will have to face Meituan’s three lines of defence. The first is the scale of orders, the second is the efficiency of order fulfilment, and the third is the service ecosystem."

Lao Zhang thinks that the self-operated model of instant retail will eventually outperform the marketplace model. He therefore reasons that the battle will ultimately be between Alibaba's Hippo of Hema (which started as supermarkets but has been opening front-end warehouses) and Meituan's Little Elephant of Xiaoxiang (which began as front-end warehouses but will open its first supermarket in Beijing in December).

🍿🍉