Author | Liu Baodan From performance to market confidence, Meituan is walking out of a three-year low point, but Wang Xing is not stopping there - he has even bigger plans. Going overseas has become a must for Chinese companies. Meituan, which has been warming up for 8 years, has finally made up its mind to put going overseas on the agenda. Recently, Meituan began recruiting senior engineers for international silver enterprise direct connection. After the model was successful in the Hong Kong market, Meituan officially kicked off its overseas expansion, accelerated recruitment and put the first stop of the overseas expansion in Saudi Arabia in the Middle East. Going overseas is a critical turning point, which means that after more than ten years of capacity accumulation, Meituan has to export its local life capabilities to the world, which is as significant as the replication of TikTok by ByteDance. In the wave of Internet companies going overseas, Meituan went overseas later because local life patterns are more important than social, e-commerce and other industries. However, Wang Xing must make this move. Against the background of intensified domestic competition and the shrinking of community group buying, he must find a new growth story. On his entrepreneurial journey, Wang Xing is still determined to create a new business legend in this global adventure. A must-have question. Meituan has fought a beautiful takeaway battle in Hong Kong. On May 6, Measurable AI, a market research firm, released the latest data showing that by March 2024, according to the number of orders, KeeTa, the takeaway business of Meituan in Hong Kong, has a market share of 44%, rising to the largest takeaway platform in Hong Kong. However, Hong Kong is only a stopover for Meituan's overseas expansion, and Meituan has set its real meaning of going overseas in Saudi Arabia. Wall Street news learned that Meituan has been recruiting people around the direction of going overseas in the past two months. The positions include engineers, overseas human resources and operation experts, international payment and transaction product managers, mainly responsible for payments, employee management and related products in overseas markets. More importantly, the recruitment of local talents. More than a month ago, Meituan posted relevant recruitment information on LinkedIn and the Middle East recruitment platform Baye.com, with Riyadh, the capital of Saudi Arabia, as the place of work. From the city selection, Meituan did not choose the United States with a larger market space, nor did it choose Southeast Asia where culture and food are more similar, but chose Saudi Arabia. It can be seen that Meituan's overseas expansion strategy still has a heavy experimental component and is more cautious. Wang Xing is not fighting an unprepared battle. For this overseas expansion, Meituan has been planning for many years. As early as 2016, Wang Xing began to consider the issue of going overseas and visited Silicon Valley, Berlin, Israel, Jakarta and other places. In 2017, Meituan officially laid out overseas accommodation business, first connecting hotels in nearly 100 countries overseas to the Meituan application. At that time, the domestic and foreign takeaway wars were in full swing, and with Meituan's listing in Hong Kong in 2018, Wang Xing's overseas strategy was forced to be shelved. Since then, Meituan has also made a series of international investments, including Swiggy in India, Gojek in Indonesia, and Opay in Nigeria, involving food, taxis, payments and other fields, to prepare for going overseas. Along with the frequent news reports of Meituan's victory in Hong Kong, Meituan's overseas plan was finally brought to an unprecedented strategic height in 2024, and Wang Xing once again rushed to the forefront. In February, Meituan put the home business group, the in-store business group and other businesses into the core local business sector, and appointed Wang Putong as CEO, while Wang Xing personally took charge of overseas business, which ensured the landing of the overseas expansion strategy in the organizational structure. In fact, before the confirmation of the overseas expansion strategy, Wang Xing personally visited the Middle East last May and met with members of the Saudi royal family, laying the foundation for Meituan's layout in Saudi Arabia.

Editor | Huang Yu More than half a year ago, e-commerce giants began to follow in the footsteps of PDD to launch "refund only". However, the drawbacks of "refund only" gradually emerged, and now Taobao is correcting its course. On July 26th, Taobao announced that it would optimize the "refund only" strategy, improve the seller's after-sales autonomy based on the new version of the experience score (store experience score), the higher the experience score, the greater the seller's disposal rights, and stores with a score of 4.8 or higher will receive more autonomy. The relevant policies will be officially implemented on August 9th. It's easy to see that Taobao is trying to strike a new balance between user experience and seller rights. Over the past few years, the biggest change in the e-commerce industry has been the rise of PDD. In addition to low prices, "refund only" is also a core factor in PDD's success. Therefore, e-commerce platforms have gone from questioning and understanding PDD to learning from PDD. At the end of last year, in order to strengthen consumer rights, Taobao began to support buyers for refund only, and JD.com also revised its guidelines to add standards for user refund only. However, while "refund only" protects consumers, it is also vulnerable to abuse by "wool party" and causes harm to seller rights. For example, during this year's June 18th promotion, many clothing merchants stated that the return rate can reach 80% or even 90%. Since consumers can apply for a refund without returning the goods for quality issues, a large number of merchants are experiencing significant losses. Insiders at Taobao told Wall Street News that Taobao is taking a beneficial exploration between users and sellers by optimizing the "refund only" based on the store experience score. "By guaranteeing consumer rights, it also significantly optimizes the business environment and forms a more benign and healthy e-commerce ecology." This also conforms to the current tone of Taobao's adjustment of the business environment. Recently, Taobao launched a round of scale modification for merchants, such as clarifying that "experience score" is the core basis for traffic distribution. In addition, from September 1st, Tmall will cancel the annual software service fee for the platform. However, Taobao's relaxation of the "refund only" rights of sellers is only to a certain extent. The premise for sellers to obtain autonomy is to continue to improve their service capabilities. At the beginning of the year, Taotian announced the upgrade of the new store comprehensive experience rating standard. After the upgrade, the rating focuses more on consumer-related indicators such as "refusal rate for refund" and "platform help rate." In addition, services that affect consumer shopping decisions, such as "return insurance", will also be a bonus for merchants. In other words, if sellers want to get high scores, they really need to serve consumers well. Of course, Taobao also provides practical rewards such as traffic to high-quality merchants, and this time it has also ceded some after-sales rights. Wall Street News learned that after the optimization strategy of "refund only" is launched, Taobao will not actively intervene through Wangwang or support refund only after receiving goods for sellers whose store experience score is greater than or equal to 4.8. Instead, Taobao encourages merchants to negotiate with consumers first. In short, Taobao will reduce or cancel after-sales intervention for high-quality stores, and the platform will give different degrees of autonomy to merchants according to the experience score and industry nature. In addition to giving merchants more autonomy, Taobao will also provide multiple after-sales service solutions for merchants to choose from, guiding merchants to continuously optimize after-sales services and reduce disputes and losses caused by "refund only". It is worth mentioning that Taobao has also optimized the appeal process for "refund only". After the user initiates an appeal, the platform will invite a third-party testing agency to sample the product. If the test passes, the platform will compensate the loss to the seller. As Taobao adjusts the "refund only" policy, it is time for the industry's grand "learning from PDD" campaign to reflect. In the increasingly fierce e-commerce competition, true innovation and differentiation can bring greater competitiveness than copying and learning from others.

The e-commerce battle is in full swing, and Alibaba is at a crucial moment of counterattacking new e-commerce forces such as Pinduoduo and Douyin. Currently, it seems that Alibaba is not fighting this battle easily.

On the evening of August 15th, Alibaba released its Q1 2025 financial report, with a revenue of 243.236 billion yuan, a year-on-year increase of 4%, setting a new low for the past four quarters.

As the core main business, Taotian's revenue this quarter reached 113.373 billion yuan, a year-on-year decrease of 1%, which is the only business with negative growth among all Alibaba's businesses. This is mainly due to Alibaba's adjustment of the business structure of domestic e-commerce.

This quarter, Alibaba shrank its direct sales business including Tmall Supermarket and Tmall International. This business achieved a revenue of 27.306 billion yuan, contributing nearly a quarter of Taotian's revenue, but the growth rate decreased by 9% year-on-year.

At the same time, Taotian's core merchant advertising revenue also faced growth bottlenecks. This quarter, Taotian's customer management revenue growth rate was only 1%, which has not yet recovered to the previous level.

Another core business, the Alibaba Cloud Intelligence Group, achieved a revenue of 26.549 billion yuan, a year-on-year increase of 6%. This is Alibaba's bet on the future. At present, it is difficult for both the scale and growth rate to play a driving role in performance.

As an extender to the overseas market, Alibaba International Digital Business Group and Cainiao achieved growth rates of 32% and 16%, respectively, and are still Alibaba's most promising businesses; the growth rates of Local Services and Large Entertainment were 12% and 4%, respectively, showing a stable trend.

Alibaba's profit mainly comes from Taotian. According to the financial report, Alibaba's adjusted EBITA for this quarter decreased by 1% year-on-year to 45.035 billion yuan, of which Taotian contributed 48.81 billion yuan, and Alibaba International, local life, and large entertainment were all in a loss.

However, Taotian's adjusted EBITA growth rate decreased by 1% year-on-year, which implies that Taotian urgently needs to improve its profitability performance in a situation where most other businesses are in a loss.

At present, in the domestic e-commerce market, Taotian is facing a situation where although the market share has been initially stabilized, the profit ability is obviously lagging behind revenue growth.

According to the financial report, Taotian's online GMV increased by high single digits year-on-year, and the order volume increased by double digits year-on-year, mainly driven by the growth of the number of buyers and the frequency of purchases, especially in the second quarter, which coincided with the 618 promotion, and Taotian's online GMV achieved strong growth year-on-year.

Alibaba Group CEO Daniel Zhang believes that Alibaba's strategy has worked, and Taotian Group has stabilized its market share and returned to a growth track.

It can be said that in the face of the rapid rise of opponents such as Pinduoduo and Douyin, Alibaba's first-stage counterattack has achieved results, but to a large extent, this is a strategy of exchanging profit for market. Next, whether Alibaba can improve its profitability will be the focus of competition in the second half of e-commerce.

The challenge is also obvious: the depressed consumer environment combined with the competition between e-commerce platforms. It is not easy for Alibaba's e-commerce business to achieve profit growth.

Morgan Stanley pointed out in a recent research report that Taobao and Tmall Group's Q1 high-single-digit GMV growth means that the market share has tended to stabilize, but the growth of customer management revenue (CMR) is only 1%, still highlighting the trend of commission rate decline.

Alibaba is also aware of this. During the earnings call, Daniel Zhang stated that after the initial stabilization of the market share, the progress of the projects aimed at improving take rate and commercialization measures will accelerate this quarter.

On August 15th, Wall Street News learned that Alibaba's new tool "Full Site Promotion" has been fully opened to all Taobao and Tmall merchants. At the same time, Alibaba also plans to start charging technology service fees for Taobao and Xianyu merchants from September, with a rate of about 0.6%.

Daniel Zhang said that after the full site promotion product was launched in April, some significant effects and progress will be seen in the 6 to 12 months after the launch. However, the perfect combination of the advertising system may take 12 months after the launch of this product.

In addition, Alibaba's new forms of products and commercialization investment, including live broadcasts, billions of subsidies, etc., have brought high user retention and repurchase rates. These new products and merchants' monetization and commercialization also require time to promote.

Goldman Sachs believes that new advertising products launched in April 2024, as well as upcoming software service fees starting in September 2024, and multiple currency-driven factors will drive the monetization rate of Taotian to a turning point starting from the September quarter.

In addition, Alibaba has fully reinvested in AI, which will soon be reflected in its performance. During the performance conference call, Alibaba stated that Alibaba Cloud customers have a strong demand for AI-related products, and their demand has not been fully satisfied.

Alibaba expects that the external customer revenue of Alibaba Cloud will return to double-digit growth in the second half of the fiscal year, and this forecast is quite clear.

In addition to Taotian, Alibaba Cloud, and overseas business, Alibaba has also increased its profit requirements for other businesses.

Wu Yongming stated that other businesses will significantly improve efficiency, vigorously promote commercialization, and thus reduce losses. "It is expected to achieve a balance of income and expenses within one or two years. After achieving a balance of income and expenses, it can gradually bring scale profitability to the group."

From initiating the largest organizational restructuring in history to a major management change, Alibaba has quickly restructured its combat effectiveness in an entrepreneurial manner, and launched the largest counterattack in more than 20 years.

After regaining users and stabilizing the market, the e-commerce industry will face a more brutal profit battle in the second half of the game.