The campus takeout scene you can’t see—taking Sichuan University as an example

Everyone is familiar with takeout. We have benefited a lot from it, but now we are being cheated a lot. If we are cheated, we still order because we have no other choice. As a project that has been popular for three years, not many people have really paid attention to the development history of food delivery and the competitive logic behind it. Just like we have not paid attention to many projects that we are accustomed to, it is not that we are blind, but it is useless to pay attention. I am engaged in food delivery on the campus of Sichuan University. I think the food delivery competition in the past three years can be regarded as a textbook example. I have always planned to briefly record it, so I will talk about it today.

Around 2012, some students discovered that the takeout market in Sichuan University was put into trial operation on a small scale and the results were pretty good. Later, Landan.com, Qifan.com, etc. followed suit. At that time, the website could only place orders on the web. After receiving the order, the website notified off-campus merchants via text message and sent someone to collect the meals off-campus. There was someone on campus to handle the delivery. The order volume was small and they were losing money. So, while taking on business from outside the school, they also established black dens inside the school to bring in business for themselves. By 2014, they were basically closed down. I once asked my younger brother to go undercover and found that when the off-campus business was low, we were taking one or two orders a day, which meant losing 70 to 80 yuan a day. The on-campus business was not making any money, so sooner or later it would go bankrupt.

At the beginning of 2014, Ele.me had raised $25 million in Series C financing, and it was rolled out in 12 cities across the country, with daily orders of 100,000. At that time, Meituan had just completed testing in the business district. At that time, Meituan’s The system is also rudimentary and cannot automatically receive orders. Full-time employees are dispatched to notify merchants by phone to receive orders. Merchant information and menu entry can only be uploaded through Excel records in the background, which is extremely inefficient. At the end of 2013, Meituan planned to expand into 20 cities and began to seize the market. The execution was very high, and it hired ten marketing managers in one week. On January 4, 2014, all the marketing managers gathered in Beijing, where they were trained, practiced and eliminated. The recruitment and training of 20 market managers were completed at the end of January, and they plan to expand into 20 cities. They believe that the advantage of being a latecomer should be reflected in the speed of expansion and picking the ripe fruits of others.

I often say that wherever our competitors’ markets are, we will follow them and use their methods to kill them. This is what Meituan does, so it is more insidious. Taking Chengdu as an example, the Chengdu city manager first took local promoters and spent a week doing research, wandering around the campus and major business districts, counting merchants, the number of takeout trucks, the proportion of takeout orders, etc. His idea is to give priority to business districts with the largest existing takeout stock due to limited resources and limited time. At that time, there was no food delivery website in Chengdu, and orders were all placed over the phone. Meituan Waimai changed the merchant’s phone ring tone into an advertisement: Come to Meituan Waimai to place an order and get drinks delivered. Meituan's takeout flyers are also accompanied by business information when distributing them, converting the two customers into each other. Takeout users who originally placed orders by phone were converted into app users.

Some marketing managers took the initiative to promote on campus and found that the cost of acquiring users was very low and orders could be generated quickly, so they developed a campus ambassador system and designed three levels: campus director, campus ambassador and building director. Each dormitory building has a building manager who is responsible for it, and later it evolved into someone on each floor being responsible for the results of Meituan’s takeaways. Meituan Waimai found that the white-collar market needs education and the market is immature (following the habit of ordering food by phone). The campus market has been educated by Ele.me and other food delivery websites. At that time, no one had a monopoly. The lack of monopoly meant that competition was relatively weak. To be fair, Meituan decided to harvest the campus market first, and then turn around and focus on the white-collar market. They set a strategy: to stabilize the existing white-collar market, focus most of their energy on campuses, first become a benchmark undergraduate institution in each city, and use its influence to attract followers.

In April 2014, Chengdu was the first city to launch a campus market. The local city manager was very capable and used more than a dozen merchants to set up the campus. I think Chengdu people are more laid-back and love Spend money and the market environment is good. They suddenly realized that they didn’t need to go to so many merchants at all. There were too few ways for students to obtain takeout information. As long as there were a dozen or so merchants, they could be attracted immediately. This was information asymmetry. The important thing is to distribute more flyers to students and do more promotions. According to the data, Meituan Waimai found that after the daily order volume on campus accounts for 7% of the total number of people, it can grow naturally. 7 is a threshold. Before that, they had to fight with Ele.me at bayonets.

In June, the two parties started to burn money. Meituan initially chose to give away drinks. Later, it was discovered that students may not like the free drinks, so it changed to offer an immediate discount of 3 yuan for first-time purchasers. Follow up on Ele.me and get an instant discount of 5 yuan. They discovered that burning money is not a bad thing as it can attract users first.

At the end of June, Meituan convened all regional managers and city managers to Beijing for a meeting to discuss summer vacation development strategies. They believed that food delivery is a lazy economy. Once you get used to a certain platform, it will be difficult to migrate, so first It is not the best strategy to acquire customers and then grab the territory. You should first grab the territory and occupy the customers' minds and habits. If Ele.me does not follow up, it will be difficult for Meituan to follow up after it has established a foothold. At that time, Meituan had developed more than 60 cities, and Ele.me had more than 40 cities. If Meituan expanded on a large scale, Ele.me would miss out on the market if it did not follow up. If it did, the students who started the business in 2009 lacked management experience, and management problems would arise. The sudden outbreak was enough for them, so Meituan set the expansion target at 250. In July, Meituan recruited 1,500 people for training. At the end of August, Meituan went to their respective universities to open up new territories. The execution ability was indeed second to none. Ele.me could only follow up and expand the team from 700 to 3,000 people.

The summer vacation has not yet started. TaoDianDian is an advanced Sichuan University. My brother and several students did marketing for it. After three days, it can sell dozens of orders every day. The marketing manager of TaoDianDian is very satisfied and gives them Bonuses were given. I was very puzzled at the time. It was really weird to give bonuses based on the order quantity. Things have been great since September. The three companies have started a money-burning war. New and old customers of Ele.me will get an instant discount of 3 yuan. Meituan Waimai will give new users an instant discount of 3 yuan. This way, they cannot beat Ele.me, and they will also adjust to new ones in stages. Old users will get a discount of 3 yuan, and Ele.me will immediately follow up and get a discount of 4... 4.5, 5, 8, 10, half price, free for the first order, 24 off for purchases over 25... At that time, every merchant was on many platforms, and the discounts were the best. Where to sell, wherever the order volume is large, close the store if it is too busy. Anyway, the subsidies are all provided by the platform. Back then, the food delivery platform subsidized the merchants, and students and merchants benefited simultaneously (the merchants raised the price, and the platform provided it to the students) Subsidies reduce prices, and in the end students save a small amount of money and businesses make a lot of money). I was very angry when I saw their flyers and found that they basically had no other strategies except price reduction. I was really worried for them. For this reason, I proposed five corresponding strategies. A few years later, those tricks have not been exhausted.

Chinese people are too smart. They will cheat on orders if there is a subsidy. My younger brother once recruited 78 people to cheat on orders at one time. I was not on the platform at the time, so I also hired students to order half-price meals and sell them at the original price. own customers. Major platforms have also discovered problems. Meituan first stopped its activities and will be permanently offline if it continues to be used. Ele.me immediately froze funds when it discovered fraudulent orders. The local subsidy budgets of each platform are limited, so each BD and local promotion team try to get merchants to bear more subsidies and increase exposure by sending more flyers. Later, the platform came forward to monopolize merchants and asked merchants to sign exclusive agreements. If they were found to log in on other platforms , threatened to deduct money and be removed from the shelves, and started to act like a hooligan. The headquarters issued an order to BD that each local promoter must sign 10. If they fail to sign, money will be deducted, and if they sign enough, they will be rewarded. In this way, Meituan's order volume increased sharply. In the specific competition, I have said many times that Wang Xing is more insidious. When Ele.me launches large-scale activities, Meituan generally does not accept the move and waits and watches secretly. As soon as Ele.me’s activities stop, it will immediately launch a relatively small one. In an instant, This little trick worked very well to bring the market back, and Ele.me was tired of dealing with it.

After the Thousand Regiments War, Meituan’s local promotion team was called the Iron Army. I was curious how they managed such a huge team. When I knew that the leaders were yelling at their subordinates in public meetings, and when I knew that they were promoting propaganda at all levels, linking it to KPIs and bonuses, requiring offline posters, banners, door stickers, etc. to be posted as required, and taking photos and uploading them, I Understood. Can't do it? Deduct money! Often can't do it? Get out! At that time, in order to gain the upper hand in public opinion, everyone wanted to announce in advance that their daily orders exceeded 1 million. On October 8, 2014, Ele.me first announced that its daily orders exceeded one million. At that time, Meituan had 980,000 to 990,000 orders per day. Should we study anti-brushing first, or hit one million first? Can I falsely report the number? The team has thought about it, so we only watched the excitement. They have thought about many interesting details behind it. The routines and methods inside are sometimes not enough for outsiders to understand.

We did not join any platform 14 years ago. If we join, we can get subsidies and market dividends. However, I believe that in the future, merchants will definitely be restricted by the platform and will be worse off than dead. I was thinking about how to compete with the platform in the cracks and monopolize the platform. In the market, how can small merchants survive through gaps and tail-end markets?

I proposed several strategies at the time. Price war was the worst strategy and should only be used as a last resort. If the other party lowers the price, I will raise the price. If the other party's price returns and the subsidy decreases, I will lower the price back to the original price. Many people say I'm crazy. If you raise the price while others are bargaining, why don't you seek death? I can only laugh. Do you think the price is mentioned casually? There must be a logic and a series of actions behind it, and they must be well-founded and measured, not just fooling around. Years later (15 years), I let my team join Meituan Food Delivery. The sales for that day was close to 900. Meituan’s marketing manager came to me and asked why I had 80 orders that day and whether the orders were fake. I asked him to look at my QQ Only after seeing customers and daily phone calls did he believe it. Even so, after the marketing manager left, my store was quickly targeted, and nearly 20,000 yuan was frozen, and it took a lot of effort to get it out. Then the battleground was moved to Baidu Waimai and Ele.me. Each platform was less than three months old. Baidu Waimai seized more than 1,000 yuan from me and refused to return it. They even asked me to continue taking orders in a particularly insidious manner. I decisively stopped. Because Ele.me later merged with TaoDianDian, the inspection became more and more strict. Stores and IDs needed to have the same address. I was too lazy to do it, so I simply removed it from the store and switched to WeChat and Weidian.com, and stopped playing with them.

As competition comes to an end, Meituan Ele.me has shifted from subsidizing merchants to subsidizing students. At this time, the subsidies for merchants became smaller, and they began to collect money from merchants in various ways, cheating merchants, bidding for ranking fees, buyout fees for the top 20 positions, charging per click for attracting traffic, and participating in big events to let merchants take the big profits ( For example, if you pay 1 yuan for a meal, it must be a meal of more than 15 yuan from the merchant. The website will subsidize four or five yuan, and other merchants will pay for it themselves), charge a commission of 15 to 20 yuan on the turnover, and also charge a delivery fee. Nearly half of the profits are taken away by the website. If you don’t use the platform, you will have no business. If you use the platform, you will be controlled by others. Now, there are too many merchants entering the school. In the past, the area was protected. There were hundreds of restaurants around the school, so the competition was relatively small. Now Meituan Ele.me has a special delivery team, forcing every merchant to use special delivery to limit the delivery scope. It is classified as 3~5KM in the surrounding area. Therefore, more than 3,000 restaurants can be delivered to each platform around Sichuan University. The market has been diluted. Many merchants have changed from 200~300 orders per day to 20~30 orders now. Ten times smaller. I think they finally got their comeuppance. I'm waiting, waiting for Meituan Ele.me and others like Didi Kuaidi to end all subsidies, charge normal fees, and open competition to all merchants. At this time, the opportunities will be great, and new opportunities will easily emerge.

Today, Meituan Ele.me is still subsidizing the delivery team. Special delivery is calculated based on the order volume. The first 100 orders are 2 yuan per order, 100 to 300 orders are 4 yuan, and 300 to 500 orders are 4 yuan. It’s 5 yuan, and for orders over 500 it’s 6 yuan. I’ve asked some delivery people, and it’s basically about 5 yuan per order. My brother is now doing it on his own in Qingdao, and he helps deliver food for various takeout platforms. He mainly does crowdsourcing delivery, and the minimum is about 3 yuan per order, and there is no cap. Sometimes The delivery fee for an order is forty or fifty, and it takes seventy miles to travel back and forth. You think these consumers are so fucked. If I were his father, I would definitely beat him to death. He is a waste of money! The internal competition among each platform is also fierce. Baidu’s food delivery market share is small and its requirements are strict. Many delivery personnel have gone to the beauty team. Wherever there are more orders and fewer deductions, the labor force will naturally flow there. This is an eternal law. After the special delivery team came out, many merchants' self-built delivery disappeared. Recently, I found that those teams are back. This shows that the fees charged by each platform have become unbearable for merchants. This is a good sign!

In April 2015, Meituan built its own delivery team to compete with Baidu Waimai. It first conducted a team test of 20 people in Zhongguancun. The test results proved that 17 to 20 orders per person can be self-financed and delivered every day. This single quantity is not difficult, and it has only begun to be promoted nationwide.

Initially, the delivery KPI assessment standard was mainly based on the quantity of delivery orders. This caused a problem. Food delivery was slow, and pasta and soups that were difficult to deliver did not like taking orders. Fast food and snacks were all rushed to be delivered. Specific to each building, from There is a demand for simple meals from street stalls to exquisite meals like teahouses. This requires the platform to integrate merchant resources, and they have begun to plan how to diversify their supplies to meet customer requirements. These are all explored in specific operations, and there are no shortcuts. I have always believed that problems are already there, and you can only discover them when you encounter them. When we don’t encounter them, we automatically ignore them. There are no clever ways in the world, only by using appropriate strategies when solving specific problems.

In studying the competition of Meituan Ele.me, we can clearly discover the importance of strategy and people, whether it is the selection and occupation of the market, the construction of the delivery team, the integration of merchant resources, the expansion of vertical categories, Every step has specific considerations. When negotiating with KFC, McDonald's, etc., if the connection was completed according to normal procedures, it would take two or three months. Responsible, I couldn't wait, and forcefully demanded more than one month for the connection to be successful. Even if the customer service personnel took the order first and transferred the order, We have to start working first. In terms of the strategy of competing for key cities, for example, if Shanghai is the base of Ele.me, then we should encircle it instead of attacking it, and only send ordinary employees to guard it. The outstanding personnel will attack the surrounding area first, and then encircle and suppress Shanghai after taking the position. We have also done a lot of homework on knowing people and making good use of them. From the management to local distribution, there are rules to follow for what should be high and what should be low.

A more classic case is that Meituan secretly poached Ele.me employees and sent private messages to Ele.me employees. If the other party responded and had a certain foundation, they would add some salary to recruit them and steal the internal operations of Ele.me. Some of the details, I think, their routines are so similar to what I thought, so shady, haha! In terms of service to merchants, we also try our best to prevent the merchant's order volume from fluctuating too much. It's good if there are activities, but it's bad if there is no activity. If this continues for a few times, the store will die. How can merchants accurately estimate order quantities and maintain Stability is also one of the details they consider. In the later period, cost control and precise operations were also a huge problem. They began to build models and through data analysis and optimization, they clearly calculated how many people to deploy in each city. I even suspect that many of the restaurants recommended by the major takeout websites are fake, and the data of many restaurants is also fake. Their internal corruption will create a variety of their own restaurants, and they will create many shadow restaurants, from other businesses. Taking orders and selling at a higher price...these are the logic behind them that we can't see. If we don't understand them, we won't think about them.

In specific operations, corruption problems also emerge one after another. We will not discuss them here, as all smart people understand. What I am concerned about is that it has been three years, and the subsidy can last for one year at most. Where will the food delivery service go after one year? I have always longed for fair competition. Once it is fair or the market is completely transparent and fully competitive, I will have many advantages. Of course, the market will never be fully competitive, and information asymmetry will always exist. We can only divide a small market in various competitions. That's good. Anyway, in the future, various food delivery platforms will not provide subsidies to students, merchants, or delivery subsidies. All costs will increase. Connecting a simple food delivery in a complicated way will increase the cost and is a huge waste of social resources. . It took thousands of years of development to introduce people to regular restaurant consumption. Now that this most efficient way is broken again, I can't understand the logic more and more. Never mind it, my opinion is that the more chaotic the better, smart people can fish in troubled waters and have a chance.