Chinese e-commerce giants Alibaba Group Holding, Meituan and JD.com are intensifying their costly rivalry in the on-demand fast-delivery sector, with each touting significant gains in user base and order volume.
Alibaba, owner of the South China Morning Post, saw combined daily orders on its freshly launched Taobao Instant Commerce initiative and Ele.me food delivery service surpass 40 million within a month, according to data released by the company on Monday.
The new service, which has products delivered by Ele.me, aims to fulfil online orders of food and consumer items in less than an hour. It reached 10 million daily orders within its first week of launch on April 30, the company previously said.
Before the recent surge in rivalry, China’s food delivery market was primarily dominated by Meituan and Ele.me, with Beijing-based Meituan holding a larger share. But after JD.com joined the fray earlier this year, the market – consisting of about 553 million users – had shifted into a “competition of ecosystems”, according to a recent report from Chinese research firm MCR.
A Meituan delivery worker seen at a Starbucks store in Beijing. Photo: Reuters
Alibaba is leveraging its extensive resources in online shopping, delivery and algorithms to maintain its dominant position in China’s e-commerce sector, as competition intensifies in the instant commerce segment.
Taobao Instant Commerce, accessible via Alibaba’s popular Taobao online shopping app, initially attracted users with subsidies on popular drinks, such as milk tea. However, sources familiar with the matter, who declined to be named, said drinks currently represented a small fraction of daily order volume, as demand was spread across a broader range of categories.
