On February 2, Meituan CEO Wang Xing announced through an internal email that Meituan would adjust its organizational structure.
The adjustment mainly focuses on two aspectsFirst, it has carried out a major integration of a number of core local businesses, Daojia Business Group, Daodian Business Group, Meituan Platform, Basic R&D Platform, etc., and jointly report to Wang Puzhong, Senior Vice President of Meituan; Dianping, SaaS, cycling, power bank and other businesses will be handled by Zhang Chuan, senior vice president of Meituan. Other organizations remain the same.
The last time Meituan made such a large-scale structural adjustment was in 2017, when the Meituan Store Group was established in December of that year, with Zhang Chuan as the head until now. Since then, Meituan has always been two business groups in parallel: in-store is divided according to consumption scenarios and focuses on the ** model; Daojia will take food delivery and flash sales as its core business.
Meituan's adjustment is seen as an escalation of defensive measures against the competitive situation, especially against Douyin.
According to Haitong International Research Report, Douyin's local life GTV (total transaction value) will reach 200 billion yuan in 2023, about one-third of Meituan's, and the vast majority of this data will be completed by in-store visits. According to **, this figure exceeded Meituan's internal expectations.
At the beginning of the new year, Zhang Chuan released a 4,200-word, harshly worded internal open letter, in which the words about battles and wars appeared no less than 10 times. Zhang Chuan reminded Meituan employees: "This is not a short-term war, but a cruel and torturous trench war. ”
But a month later, Zhang Chuan was transferred out of the store business group, highlighting Meituan's decision-making level, or Wang Xing's eagerness to meet the invasion of Douyin through organizational structure adjustments.
Meituan hopes to concentrate its superior resources for more efficient decision-making. The first is to integrate the Daojia and Daojia business groups, in the 36kr report, a person close to Meituan said that ** and takeaway have a high degree of overlap in the supply focus, and the internal has been trying to promote the synergy between the in-store and Daojia business.
Secondly, in order to better mobilize resources and improve organizational efficiency, Wang Xing also assigned him the two middle office departments of Meituan platform and basic R&D, and the previous S-team members of the two platforms, Meituan Senior Vice President Li Shubin and Meituan Vice President Han Jian will report to Wang Puzhong.
Over the past year, Meituan's frequent strategic adjustments to its in-store business have shown that it must turn defensive into offensive in response to Douyin's competition.
In February last year, Meituan launched a "special offer" for benchmarking against Douyin** In July last year, Meituan officially opened a first-level entrance for live broadcasting; In August, the "** tab" was launched in the center of the menu bar at the bottom of the home page, and the weight of the short** drainage entrance was increased.
At the same time, Meituan has not let up on the defensive end. According to ** reports, Meituan also gave huge traffic support or rent reductions to merchants who were willing to remove from the shelves in Douyin's "discounts**" or were willing to offer lower prices.
For this, Meituan has paid more costs. According to the Q3 2023 financial report data, Meituan's commission income decreased from 47% to 31%; sales and marketing expenditure reached 16.9 billion yuan, a year-on-year increase of 55%; The marketing expense ratio reached the highest in the past seven quarters at 221%。
In Zhang Chuan's internal letter, in fact, we can already see signs of Meituan's strategic adjustment. Zhang Chuan said that in the past, Meituan had regarded land bulldosing as a barrier, and used long-term investment to build a stable offline supply system and a moat for food delivery. But now, things have changed.
The core lies in the fact that Meituan's shelf e-commerce system is mature, and consumers have long developed the mentality of "people looking for goods", while Douyin's public domain traffic algorithm distribution has a stronger control over user attention and content consumption.
With the help of huge traffic and push mechanism, Douyin has realized a closed loop from planting grass to pulling weeds.
Behind the rise of content platforms such as Xiaohongshu and Douyin is the confirmation that traffic has turned into purchase behavior, and this recommendation mechanism relying on entertainment + randomness is just misaligned with Meituan's strong purpose.
This dislocation is reflected in the different values offered to merchants: Douyin is more attractive to high-frequency and low-decision-making products, while Meituan is a powerhouse for low-frequency and high-decision-making products.
In a previous article, we mentioned that if Douyin reuses Meituan's play, it can essentially extend from high-frequency and low-decision-making to low-frequency and high-decision. The so-called dislocation competition can only be temporary, Douyin will not be satisfied with just 20 yuan a cup of milk tea**, which can't get much commission and advertising, the vast store and wine travel is the sea of stars.
It's just that on the supply side, Douyin does not yet have a strong local promotion and business layout.
However, Zhang Chuan also mentioned in an internal letter at the beginning of the year, "In the past, it served search and shelf users, and in the future, it will serve users who are looking for low prices on the whole network; As the supply changes, it is necessary to constantly communicate with merchants about pricing and promote business competition; The product model has changed from POI (point of interest) as the core to SKU as the core, using new organizational capabilities such as offline push and WeChat groups to spread low prices every day and drive user growth. ”
This shows that although Meituan's offensive revolves around the low-price mentality, it has given up the "store" in terms of specific logic, and instead follows Douyin's example of "product" as the center.
However, due to the lack of the concept of "store" and the single way of drainage, Douyin has not yet established a clear mind and long-term repurchase of users and helped merchants accumulate operating assets and form a positive business cycle, but this may change in the future.
Using the low-price mentality, Douyin is expanding outward with search as the center, and once the search volume starts, it means that Douyin's "people looking for goods" model has been established.
According to ** reports, Douyin is strengthening its marketing capabilities through gameplay modes such as traffic pools, precise pushes, "grass planting" and "store visits", which is equivalent to digging the corner of Meituan's supply side. Once Douyin forms a supply diversification at the level of "store", then repurchase and user minds are not far away.
However, with Zhang Chuan's transfer and Wang Puzhong taking over, it remains to be seen whether Meituan will advance according to this logic in the future.
This article**: decoding decode, original title: "Meituan's structural adjustment, or will affect the promotion of local life strategy"**Wall Street news, welcome**app to see more.