Alibaba-owned food delivery platform Ele.me is upping the ante by targeting 30-minute deliveries over Spring Festival, as more delivery people are willing to stay in big cities over the holiday period.
Chinese consumers can order goods from 7,000 supermarkets around the country during the national holiday. An Ele.me spokesperson told TechNode that delivery people who work during the Spring Festival would receive a bonus of up to RMB 1,800 (around $270) per week.
Since being acquired by Alibaba in April 2018, Ele.me has escalated a cash-burning subsidy war with Meituan Dianping. Ele.me announced last summer that it planned to spend more than $400 million from July to September to increase its market share to over 50% as the competition between the two companies heated up.
“There is a considerable increase in the number of deliverymen who are willing to stay [and deliver] this year,” an Ele.me spokesperson told TechNode. The company attributes the growing number of delivery people willing to work during a time when people typically travel to their hometowns to the ability to make more money over the holiday period, driven by an increase in sales.
In November 2017, Alibaba spent $2.9 billion to take a 36% stake in RT-Mart’s parent Sun Art Retail Group. This was followed by a digital transformation of its stores, which gained access to Alibaba’s customer insights platform, supply-chain management, and mobile payments service Alipay. Ele.me has partnered with retailers including supermarket RT-Mart and French retail china Carrefour.
The Chinese e-commerce giant also formed a partnership with Carrefour as early as May 2015 in a marketing move to promote Alipay in offline stores. Alibaba-backed retailer Suning plans to open 15,000 offline stores in 2019, seeking to expand its businesses in numerous lower-tier Chinese cities.
Chinese internet service companies are expanding their offline presence amid a slowing economy and increased competition. Meituan Dianping launched its offline fresh grocery brand Ella in May 2018, incorporating online ordering and delivery services with brick-and-mortar stores. It also recently announced a plan to invest $1.7 billion this year to support merchants on its platform. The company also intends to provide incentives and awards for merchant innovation.