Dianping celebrated its tenth birthday on April 24. At ChinaBang 2013 earlier this month, Long Wei, co-founder of Dianping, disclosed the latest data,

  • Monthly active users are 60 million;
  • Mobile app downloads are over 64 million;
  • 70%, up from 50% same time last year, of traffic is from mobile devices;

Revenue sources include e-coupons, group-buy and keyword search advertising, according to Long Wei. To launch e-coupons on Dianping platform, merchants pay monthly or yearly fees. Group-buy implies good cash flow, but the whole sector is still far from profitable due to low margins — The gross margin is below 10%, Zhang Tao, CEO of Dianping, once disclosed. Wang Huiwen, co-founder of Meituan disclosed at ChinaBang 2013 that their gross margin was as low as 7%. The keyword search ads are not available on mobile versions yet.

Starting out as a ratings & reviews site in 2003, Dianping had had 25 million reviews as of the first quarter of 2013, according to its official data. It later became a Yelp + Foursquare + Groupon around 2010. To meet the demand of mobile users’ for searching for places nearby, Zhou Bian Kuai Cha was released last year. At the beginning of this year, Dianping announced to open up data to third parties.

From 2006, the company has raised four rounds of financing that totaled US$160.5 million from names including Sequoia Capital China, TBP, Qiming, Vangoo, Lightspeed and Google. It is reported that the company was valued at US one billion in the last two rounds of funding. Its management have been talking about IPO plan since 2005. In 2008, its founder and CEO Zhang Tao said that the company would go public in three years.

As the leader in ratings & reviews sector, Dianping, however, doesn’t seem so well-positioned than a couple of years ago. Many apps out there are offering one or some of Dianping’s services, and Dianping is no better than them. Dianping does own data that few can beat, but we don’t see how well it has taken advantage of it. It would be in danger if users download e-coupons, search for group-buying deals or check out restaurant reviews with other apps. And it is happening.

Tracey Xiang is Beijing, China-based tech writer. Reach her at traceyxiang@gmail.com

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