According to the estimation of Guojin**, the number of daily active users of Dianping will reach 18.9 million in 2023, which is still a year-on-year increase of 81%[2]. The huge gap with the national app makes it easy to underestimate the importance of Dianping.
At the beginning of 2024, Meituan will start the largest organizational restructuring since its listing, and the originally independent home and store business groups, as well as the Meituan platform and basic R&D platform, will be managed by senior vice president Wang Puzhong.
Dianping was divided into a number of business divisions, which, along with many new businesses in Meituan's financial report, were handed over to the veteran Zhang Chuan.
The first thing Zhang Chuan did in Meituan was Dianping's "must-eat list", and Zhang Chuan was credited to a large number of users diagnosed with difficulty in choosing. Dianping's in-store business is also the main source of Meituan's profits.
Dianping's recommended food page has saved countless consumers who can't order, and for Meituan, which has entered a wartime state, Dianping has never been as indispensable as it is today.
Born in 2003, Dianping is the world's first third-party consumer review**, a year before the advent of its American counterpart, Yelp.
Yelp has become the No. 1 review** in the United States, but it has always been stuck in commercialization; After Groupon, which created the ** model, became a smash hit, it gradually faded out of the public eye due to the limited number of merchants. On the contrary, Dianping has stood tall in the mobile era, and has been dancing with long sleeves for 20 years.
The U.S. food, drink and entertainment market has a very high chain rate, and Starbucks and McDonald's have a complete marketing system. In contrast, the supply of domestic catering industry is particularly fragmented, with a large number of catering and leisure and entertainment merchants with low chain rates and mostly independent operations, unable to afford the cost of self-built marketing departments, and have a higher demand for online customer acquisition.
Around 2010, Dianping's uniqueness began to emerge in the mobile wave
Dianping is essentially a product with strong tool attributes, but it successfully solves the problem that utility apps can't make money.
Similar to weather and map software, the public point rating is a search tool located in the vertical field. Tool products are characterized by extremely clear requirements and highly rigid demand in scenarios. However, the problem is often that users cannot interact frequently and for a long time in the product, so it is difficult to realize the "monetization" of traffic through advertising, e-commerce and other means.
But Dianping connects specific transactions such as dining and entertainment, and for local businesses, every search and click is a consumer decision. Shen Nanpeng once said that when Sequoia China first invested in Dianping in 2006, "what it valued was its local advertising model".
Some ** and service businesses that do not have industry standards rely heavily on word-of-mouth recommendations to get customers. Therefore, as early as 2014, more than half of the orders of many wedding merchants came from Dianping [3].
However, Shen Nanpeng did not realize the huge potential of Dianping in local life services, and the mobile Internet brought another important business model to Dianping:
The key to the profitability of instrument-based products lies in whether they can be cut into specific trading scenarios. Mapping software doesn't make money because people just want to use it for navigation; The software is soft because people spend money on it and feel that they can make money from the bottom of their hearts.
*The essence is an upgrade of Internet performance advertising. Compared with performance advertising, ** products bring a clearer offline customer conversion, as well as a more intuitive calculation of marketing effects. For Dianping, ** directly cuts into the specific transaction scenario and brings intuitive platform commissions.
After the launch**, local merchants flocked to Dianping, with the number of merchants tripling fivefold in 2012-2013 and a five-fold increase in 2014[5]. Dianping then realized the long-cherished dream of all tool-based products:Users can not only enjoy the experience of running out, but also bring a steady stream of cash flow.
Guoxin** report shows thatPrior to the merger with Meituan, Dianping** and advertising accounted for 55% and 45% of revenue, respectively, making it the most important business engine for Dianping
2015 was a year of super mergers for China's internet, with Didi and Kuaidi, 58.com and Ganji, Ctrip and Qunar all announcing mergers in the year. The protracted war of 1,000 regiments also died down at the same time, and Dianping and Meituan officially merged.
The Thousand Regiments War is the first marketing war in the history of China's Internet that consumes hundreds of millions of funds [6], and more than 5,000 companies have poured a huge amount of subsidy budgets.
The last survivors, Meituan and Dianping, were also the first and second in the ** market at that time.
It's not unusual for the eldest and second to shake hands, but Meituan and Dianping have been the most successful Chinese internet to dateMergers and acquisitions, most likely not one.
Most of the motivation for mergers and acquisitions is "not wanting to fight", and the merger of Meituan and Dianping is the same, but the business and user structure of the two companies are naturally complementary, which was once broken by Guan Mingsheng, the former president of Alibaba
The battle of thousands of regiments is essentially an offline advertising war, if it is for merchants, no matter how good the advertisement is, it is not as good as the execution of the strong push team; If you're consumer-facing, online performance ads are much better than offline brand ads.
Before the merger, Dianping had occupied nearly half of the local life field, and had more online influence than any other company at that time.
Due to the user structure backed by big cities, high-priced services such as weddings and beauties have developed rapidly. However, the shortcomings lie in the weak execution of offline business, the slow speed of city expansion, and the low efficiency of the first performance link.
Meituan is good at the supply side, and the local push iron army led by Gan Jiawei has expanded its territory in third- and fourth-tier cities while settling accounts, which not only quickly expanded the market share in a short period of time, but also avoided unnecessary cost consumption.
However, users in the sinking market are more sensitive to **, and Meituan's basic market is low-priced goods based on takeaway and **, and the overall gross profit margin is low.
This kind of genetic complementarity ended a vicious battle that would have been fought for many years, and also completely changed the market pattern of the first class. After the merger of Dianping and Meituan, the track of local life took on a truly complete appearance.
After the merger of the two parties, Meituan began to fully invest in the construction of transportation capacity, and Meituan's delivery team has been infinitely close to "everything that can be bought" from "food delivery" to "everything that can be bought", at the cost of a large amount of costs. In the past few years, Meituan's cost in the delivery process has been higher than the revenue generated by delivery.
The in-store business, including Dianping, is still an important engine for Meituan's profits.
Before the change in Meituan's revenue caliber, home delivery and flash sales accounted for more than 60% of its revenue, but the profit margin was not high. Most of the profits** are from the in-store hospitality business, although the revenue of this part of the business accounts for only 182%, but it generated more than twice the operating profit of the food delivery business [8].
Among them, Dianping's commission income and advertising revenue exceeded 10 billion yuan, close to 1 3 of Meituan's in-store business revenue. Dianping's annual budget has been less than 1 billion yuan[1].
After the merger of the two parties, Meituan has been unbeatable, and its annual transaction volume is approaching 1 4 of the booming e-commerce platforms, making it difficult for other local lifestyle platforms to match[7].
Eight years after the merger, Dianping is no longer active in the front of the stage, but it has always been a strategic high ground that is difficult to ignore in Meituan's business territory.
Meituan's strategy has been interpreted as "high-frequency and low-frequency", that is, high-frequency take-out and flash sales drive low-frequency in-store and wine tourism. Although the profitability of the Daojia business is limited, the traffic it brings to Meituan's stores is continuously channeled, allowing Meituan to find a delicate balance between scale and profit margins.
In March 2018, Meituan's hotel room nights surpassed those of Ctrip, Qunar and Tongcheng-Elong combined for the first time. In the same year, 90% of its hotel bookings were from existing takeaway or in-store businesses[9].
Zhang Chuan, who fought a tough battle in Meituan, later revised it to: high frequency drives the middle frequency to form a huge user platform, and then optimizes the low frequency experience. Medium-frequency services, such as hotels, KTVs, and movie tickets, can be driven by high-frequency services. The 3Cs can be driven by clothing in high-frequency service.
After the war on local life resumed, transportation capacity is Meituan's most obvious line of defense. Meituan has more than 5 million delivery riders, and in the process, Meituan has built a corresponding management and technical system. If you want to create a new capacity supply in a short period of time, it cannot be said that it is absolutely impossible, but the possibility is lower than that of pedicology to be included in medical insurance.
Dianping is another hidden line of defense.
Although many attempts have been made to force the content but have failed, its tool attributes have always played an important role. In other words, when users open Dianping, they are most likely looking for food. This certainty of consumption decisions is still the foundation of Dianping, which directly affects the merchant's customer acquisition conversion rate.
Most of the service retail represented by the in-store business is experiential consumption, and the high cost of trial and error makes consumers rely heavily on the evaluation of other users when making decisions. Similar to Douban movie scores, it has a complete supply of classification, evaluation, and UGC content system, and currently only has public reviews.
One example is that eight years after the merger, Meituan and Dianping still have structural differences in their users. According to Questmobile's statistics, in 2023, the overlap between Dianping and Meituan users will be as high as 758%, but the scale of daily active users of the former has not been affected. 20.6% of Meituan's daily active users also use Dianping[9].
It is difficult to solve the immediacy of consumption with content. In other words, at the time of the coupon, whether the user is sitting in the store or lying at home, which directly affects the write-off rate of the coupon.
According to the estimation of Zhongtai**, Meituan, which focuses on search, has a search write-off rate of more than 90%[11], which is higher than the 50%-60% of content platforms. Because users who place orders on content platforms are likely not willing to go to the store to make purchases immediately, considering the 3-5 km radius of local life services, the advantage of wide reach of in-feed advertising is also weakened.
In the intensifying war of local life, Meituan's frontline may seem to be rarely seen by Dianping, but it plays an extremely important role.
For most consumers, there are not many more reliable tools to solve the problem of "what to eat at night".