Alibaba Restructures Local Consumer Business To Combat Meituan And Douyin Rivalry

  • Alibaba Group Holding Limited BABA consolidated certain operations in its local consumer services segment to cope with increased competition.
  • Alibaba looked to merge its Koubei restaurant review feature into the Amap app, which provides a mobile digital map, navigation, real-time traffic information, and a ride-hailing aggregator, SCMP reports.
  • Koubei head Zhang Liang will report directly to Amap CEO Liu Zhenfei instead of local consumer services group head Yu Yongfu.
  • Alibaba's local consumer services business segment includes food delivery unit, online-to-offline integration service solution provider Taoxianda, Amap, and online travel platform Fliggy.
  • The reorganization marked Alibaba's attempt to stay relevant in the country's on-demand local services industry, dominated by Meituan MPNGF MPNGY and ByteDance Ltd-owned Douyin.
  • China's on-demand local services sector will likely be worth more than 35 trillion yuan ($5.1 trillion) by 2025. Besides food and grocery deliveries, on-demand local services enable online consumers to connect with offline merchants from various fields.
  • In 2022, Alibaba's local consumer services revenue increased by 21% in the September quarter to 13.07 billion yuan, driven by strong order growth at its Amap business.
  • Alibaba's local consumer services segment also narrowed its losses in Q3 to 3.49 billion yuan, from 6.53 billion yuan the previous year, on the back of improving business operations at
  • Price Action: BABA shares closed lower by 4.91% at $95.10 on Tuesday.
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