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The Strategies, Tactics and Challenges for China's Food Delivery Industry

· TechNode,Alibaba,Meituan,O2O,Editor's Desk

Huan-Po knows it's about lunchtime when his colleagues start to circulate an online menu in their WeChat group at around 11 am. “We'll have our lunch delivered and find a meeting room to dine together,” he says. Huan-Po is an MBA student at Peking University and interns at a startup in Beijing. He enjoys the convenience of food delivery so much that he even gets food brought to his student dorm.

“You'll often see lots of deliverymen waiting outside of the dorm for the students to come down and pick up the food,” he says.

The O2O (online to offline) food delivery sector has been booming in China over the past year. Once an online order is placed through a mobile app, food from local restaurants can often be delivered within 30 minutes to an hour. The fast service at the press of a smartphone screen has encouraged more and more urbanites to use the various services.

The user base of online food delivery surged by 41.6% to 295 million users over the first half of 2017, said China Internet Network Information Center (CNNIC) in a report released in July. It’s worth noting that over 90% of the customers placed orders via a smartphone.

“As the industry matured and profitability becomes low, it is obvious for the platforms to explore horizontally in other relevant businesses,” said CNNIC in the report.

This article was originally published by Timmy Shen on September 27, 2017 via TechNode.

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