ByteDance's Douyin is Currently Working on a Food Delivery Service to Rival Alibaba and Meituan

Sophie Webster, Tech Times 17 July 2022, 09:07 am

(Photo : Unsplash/Rowan Freeman) Southeast Asian Food Delivery Players, Grab, GoTo Face Slump as Spending Growth Slows to Four-Year Low

Douyin, China's version of TikTok and owned by ByteDance, is dipping its toes in the food delivery market.

The app has tested a new feature that would compete with food delivery market leaders Alibaba Group Holding and Meituan.

Douyin to Get Into Food Delivery

According to SCMP, the social media app's delivery options of group-purchased goods are intended for businesses with urgent needs, and the feature is still under development.

Some restaurants in particular cities in China, including those whose businesses were affected by the COVID-19 cases in 2022 like Shanghai, now include an option on their Douyin accounts for users to order food with delivery.

But restaurants must first provide their own delivery staff or use delivery drivers from another service, according to PanDaily.

A Douyin representative said that the app's life service team is carrying out activities to help businesses recover in some cities.

Also Read: ByteDance Changes Names of Subsidiaries to Douyin, Speculated to be Mulling an IPO

Without having its own delivery personnel, ByteDance could be in for an uphill battle as it launches a soft exploration of the market.

Meanwhile, Douyin's competitors, Meituan and Alibaba's Ele.me own their army of delivery drivers, and they are dominating the Chinese city streets.

China's Food Delivery Market

Douyin's latest move marks the app's second foray into food delivery. In 2021, it tested Xindong Waimai, a food delivery service launched as a part of a mini program that opens within the app. The company eventually opted not to go with a nationwide rollout.

Some fast food chains, like KFC and HeyTea, have offered deliveries through Douyin since 2021 using their own personnel.

However, the companies offered the service through their own initiative, and the platform did not officially support it.

The potential to crack the delivery food market has even enticed JD.com, an e-commerce giant.

In June, JD Retail chief executive Xin Lijun told Bloomberg in an interview that the company was working on getting into the market because Dada Nexus, JD's logistics affiliate, is said to have strong capabilities in food delivery.

A Dada representative revealed that its food delivery service is still in the planning stage.

A Million Dollar Market

Social media and logistics companies are seeking to grab a slice of the food delivery market and its huge rewards. In 2021, food delivery users in China increased by 30%, or 554 million of the population.

The food delivery market had been growing quickly even before the COVID-19 pandemic happened, and the demand increased so much more while people were forced to stay at home during multiple periods of lockdowns across different cities.

However, getting a spot in the market means changing user preferences for apps that have become staples of a lot of people's digital lives in China. Meituan and Alibaba made up 69% and 26% of the market in 2020.

Baidu, China's internet search company, also entered the market back in 2014, only to sell Baidu Waimai in 2017 to Ele.me, which rebranded the service to Star.Ele.me. That service made up 4% of the market in 2020.

This article is owned by Tech Times

Written by Sophie Webster