This undated photo shows a Meituan booth during an expo in Beijing. (PHOTO PROVIDED TO CHINA DAILY)
Meituan’s delivery service launched in Hong Kong on Monday, marking the mainland takeaway giant’s first foray into the international market. However, its first day performance shows it faces challenges resulting from insufficient orders and a shortage of food delivery staff.
KeeTa, inspired by the cheetah’s lightning speed, will first serve the densely populated areas of Mong Kok and Tai Kok Tsui, with the service gradually expanding to the whole city by the end of the year, according to Meituan.
Deliveroo, for instance, kicked off a new campaign with an investment of HK$1 million on Monday, under which riders will be given double tips according to the amount offered by users
Meituan made its debut in Hong Kong with large vouchers and subsidies to lure consumers and delivery personnel. In addition to a coupon worth HK$300 ($38.4), each registered new user can also enjoy diversified discounts and free delivery. To attract riders, KeeTa has introduced a set of incentives, such as an extra HK$2,500 for those who complete their delivery target within 14 days.
READ MORE: Meituan gets more funds from Tencent
An anonymous young delivery man told China Daily that he had made a two-kilometer delivery on bicycle as of around 1pm, five hours after KeeTa began its service on Monday, and he could earn HK$34 from that. He added he had learned about KeeTa’s recruitment of riders through its large-scale promotions on social media, but given KeeTa’s limited orders during the initial phase, he also works for other delivery companies – Deliveroo Plc and Delivery Hero SE’s Foodpanda.
As the largest food delivery platform in the Chinese mainland, Meituan in the past year has far outpaced its competitor, Alibaba’s Ele.me. Meituan’s earnings report for the year of 2022 revealed that the number of delivery orders grew 14 percent year-on-year to 17.7 billion, with the peak of single-day deliveries topping 60 million.
Meituan’s presence in Hong Kong, however, is expected to face tough competition from Foodpanda and Deliveroo, which have been operating in the city since 2014 and 2015 respectively, and hold almost 90 percent of the market share.
Deliveroo, for instance, kicked off a new campaign with an investment of HK$1 million on Monday, under which riders will be given double tips according to the amount offered by users.
The mainland giant is not the first to try to grab a slice of Hong Kong’s food delivery market. Uber Eats, a US-based platform, entered the market in 2016 but officially announced its exit from Hong Kong in late 2021. Uber Eats held only 3 percent of the market share as it withdrew from the competition, according to Measurable AI.
READ MORE: Meituan maps out high-tech way ahead
About 10 marketing staff worked in Mong Kok today to promote KeeTa to passersby. Kelly Tse, who works part-time as a promoter, told China Daily that fewer than 10 people downloaded KeeTa between 11am and 1pm using the QR code Kelly shared.
But Joan Keung, a consumer in Mong Kok, said she is willing to use KeeTa since she has used Meituan before and found it user-friendly and convenient.
“Given the differences between the food service market in Hong Kong and the Chinese mainland, the operating model and strategy we use in Hong Kong may change,” Wang Xing, founder and CEO of Meituan, said in a conference call after the release of its earnings for the third quarter of 2022 in November.