Author |Liu Baodan.
In the past year, Douyin's rapid growth in the local lifestyle market has put pressure on the boss Meituan, and its stock price has also been affected. Starting on January 10, Meituan Chairman Wang Xing spent HK$3.2 billion to buy back ** for eight consecutive days, boosting investor confidence.
Outside the capital market, Meituan and Wang Xing, who have been brewing for a period of time, launched a big ** in a strategic sense.
On February 2, Meituan's top decision-making body, S-TEAM, made organizational adjustments to its core local business, merging the two business groups of Daojia and Daodian, and handing them over to Wang Puzhong, senior vice president.
Specifically, Meituan's adjustment includes: integrating the Daojia business group, the store business group, the Meituan platform, basic research and development, etc., and jointly reporting to Wang Puzhong. The business of Dianping, SaaS, cycling, and power bank will be handled by Zhang Chuan, senior vice president. In addition, Wang Xing personally took over the drone and overseas business.
The core local business, which includes in-store and home-to-home services, is the foundation of Meituan, contributing more than 70% of Meituan's revenue, and now the integration of the two departments will allow Meituan to be more agile in the face of Douyin competition.
Not only that, with the integration of many independent business groups into one large department, Meituan will have more resources to mobilize in the future, so as to truly unite troops in one place and concentrate on destroying the enemy.
It is worth noting that the No. 1 position of Meituan's store business group has also changed, and Wang Puzhong replaced Zhang Chuan as the new person in charge.
Jiang Han, a senior researcher at Pangu Think Tank, believes that the integration of in-store and home-to-home will help achieve resource sharing and better respond to market changes.
A person close to Meituan said that ** has a high degree of overlap with the supply of food delivery, which is to meet the similar needs of consumers in different fulfillment methods, and integrate them with platforms and R&D, reflecting Meituan's determination to further improve organizational efficiency and upgrade product experience.
Zhuang Shuai, an expert in the retail e-commerce industry and founder of Bailian Consulting, believes that Meituan will be more competitive in terms of product richness and quality in the future, and from the perspective of merchants, the linkage between store and home delivery business has also been strengthened, and the development of instant retail business can also be strengthened.
With Wang Puzhong's ascension, Meituan's core local businesses will take more active actions.
Wang Puzhong joined Meituan in 2015 and has served as senior product director of food delivery, head of food delivery business unit and delivery business department, and has successfully expanded the instant retail business. Currently, he is the youngest member of Meituan's S-Team and Wang Xing's most powerful subordinate.
At the end of last year, Douyin's local life had just been replaced, and Pu Yanzi, the head of commercialization of Douyin Group, was also the head of Douyin's life service business.
As both Douyin and Meituan usher in a new No. 1 position in local life, the next strategic changes and playing styles of both parties will become the focus of market attention.
At present, it is not known how Wang Puzhong will make a move. A number of catering companies that have cooperated with Meituan told Wall Street that they have not received Meituan's policy direction in takeaway and ** business for the time being.
In addition to competing with Douyin in the local lifestyle market, Meituan has also released positive signals about technology and international business in this structural adjustment.
Wang Xing has unlocked new tasks for himself, and in the future, Meituan's drones and overseas business will be directly reported to him, directly raising the priority of this part of the business.
At present, Meituan's drones and overseas business are in the exploratory stage. In 2017, Meituan launched the exploration of drone delivery services, aiming to promote the transformation of fulfillment tools through technological innovation.
As of December 2022, Meituan's drone delivery has been implemented in 5 business districts in Shenzhen, and more than 120,000 orders for real users have been completed.
In terms of overseas business, Meituan has already taken the first step. In May 2023, Meituan launched a new food delivery brand Keeta in Hong Kong, and in December, Keeta's market share in Hong Kong rose to 37%, ranking second.
Whether it is a core local business or an exploratory business that represents the future, this structural adjustment points to Meituan's core performance capabilities, and also allows the outside world to see a Meituan that is sharpening its knives.
Local life has always been a fiercely competitive market, and Meituan is a company that has grown out of the 100-group war and the food delivery war. At its peak, Meituan had few competitors. However, in the face of Douyin's continuous attack, Meituan has clearly underestimated the strength of its opponents before.
In the past year, Meituan has adopted a series of strategies such as reducing merchant deduction points and launching live broadcasts to cope with Douyin's attack. He also promoted five vice presidents at one time, trying to improve the organization's combat effectiveness by promoting the internal young Zhuang faction.
With this structural adjustment, Meituan finally moved to the core business organization. Insiders close to Meituan said that since the shift to the new strategy of "retail + technology" in 2021, this is the first large-scale adjustment of Meituan's organization and personnel, especially the last adjustment of the Daojia business group, which dates back to 2017.
This is an important sign, if the previous competition was controlled by Douyin in the offensive rhythm, Meituan can only respond passively, then, this adjustment means that Wang Xing began to find the initiative in competition, Meituan re-entered the "battle mode" after many years.
The adjustment of the core structure is to match the strategic needs, which also shows that Wang Xing has a new way to play the local life market in 2024.
In an internal email, Mr. Wang made a rare mention of Meituan's current situation. He said that the current internal and external challenges are fraught, but at the same time, this is an opportunity for the company to grow further.
2024 will be a critical year for Meituan to win the third battle of local life, and the competition between giants has begun.