Catering professionals on Douyin will return to Meituan sooner or later

Douyin Local Life continues to attract offline merchants, threatening Meituan. However, what is the compatibility between local merchants and Douyin Local Life, and how long will this cooperation last? This article analyzes the growth mode of Douyin Local Life and the traffic logic of local merchants on Douyin Local Life, points out the differences between Douyin Local Life and local merchants in terms of in-depth cooperation, and puts forward a forward-looking view on the growth of platform traffic. I hope it will be inspiring for you who follow Douyin.

Douyin Local Life, which was launched in POI in 2018, has not seen any improvement for many years, but this year it finally saw new moves.

On the one hand, this year's local life sector is one of the few sectors that has maintained a good growth rate after the slowdown in the growth of its advertising and e-commerce businesses; on the other hand, when local businesses need more accelerated recovery capabilities to get out of trouble, Douyin, which has a traffic advantage, actually gets more opportunities to attack.

Whether it is mainly based on the high-growth online transaction volume on the home delivery side, or the multiple adjustments in conjunction with external partners, Douyin's local life in 2022 is finally lively enough to hear the sound. With the support of Douyin's nearby algorithms, in theory, where there is traffic, there will be business.

However, there seems to be a natural gap between local businesses that focus on short-term traffic and the Douyin platform that wants to fight for a long time, which makes it difficult to establish a deep cooperative relationship. Every emotional moment of local businesses is constantly shaking Douyin's ability to fight for a long time in local life.

1. Catering merchants celebrate the festival in the live broadcast room

Celebrating festivals in the live broadcast room is becoming the main way for many catering businesses to regain the atmosphere of dine-in meals.

Xue Kai, a hotpot operator who relies on dine-in meals as his main source of income, chose to sell Christmas holiday packages at a 45% discount in a local food group-buying live broadcast room on the first holiday after a week of epidemic prevention and control adjustments, hoping to attract more customers to dine in the store.

In his opinion, although low-price traffic diversion does not make money or even loses money, it keeps the entire store busy for now, so that the operations of employees and even the entire store can be restored and plans for the next stage can be made.

Why choose to celebrate the festival on Douyin instead of Meituan? Xue Kai believes that the behavior pattern of Meituan users is that after consumers arrive at the store, they will check Meituan to see if there are any discount packages.

This kind of in-store group buying is essentially a more cost-effective choice for the store's target consumers, and the effect of attracting new customers is limited. In comparison, Douyin's group buying mainly focuses on attracting new customers locally, and consumers often make appointments to shop in stores after purchasing in advance. When the store's natural customer flow can meet the needs of dine-in customers, this kind of low-price traffic diversion is harmful to customers, but it is still a good acceleration effect for the recovery stage of dine-in customers.

On the one hand, during the recovery phase, more public external traffic is needed to accelerate the recovery of stores. Douyin, which has more advantages in traffic, has become the choice for many businesses to attract new customers. On the other hand, in Douyin's pan-entertainment content ecosystem, low-cost traffic diversion in the form of live streaming also has a more festive atmosphere.

A marketing person in catering brands said that holiday promotions have always been a routine action for businesses, but in the past they were mainly concentrated offline. Previously, whether it was Meituan or Ele.me, they had been doing it for many years, but there were not many online scenarios that were truly suitable for catering businesses to do holiday promotions. The current Douyin live broadcast room has well filled the gap in the catering online holiday scene that has been absent for many years.

Not only in terms of public domain traffic on the store side, but also in terms of public domain traffic on the home side, festivals are also a good means of attack for Douyin.

As a top hotpot brand like Haidilao, it was not very enthusiastic about Meituan Takeaway before, and always insisted on its own private takeaway customers. However, in the face of Douyin's superior traffic, it also bowed its head in August this year. Since entering Douyin's local life, Haidilao's first live broadcast in China has exceeded 20 million GMV.

Subsequently, it became the norm to celebrate festivals on Douyin. From the "Back to School Season" node operation to the "Douyin Heart-beating New Product Day" new product incubation, to the home group purchase package around Christmas, Haidilao has been making continuous moves. In less than half a year, Haidilao's GMV on the Douyin platform has exceeded 500 million. Whether it can make money or not is beyond question, this will undoubtedly become a thorn in Meituan's heart that is difficult to remove.

In the view of catering observer Zhang Yang, once a gap is opened, Meituan’s moat will continue to be eroded.

2. Douyin is still lagging behind in the long-term battle

When Douyin hopes to use more offensive means to launch a blitzkrieg in local life, Meituan, as the inherent advantage in the market, is not in a hurry. It defends based on its own advantages and capabilities, using time to trade off the weakness of the attacker.

After all, the process of attracting new customers will always pass, and the natural traffic in the offline business environment will always come back. The abundant local supply capabilities and the minute-level transportation system across the country are still Meituan’s strongest fortress.

In order to prepare for the arrival of a protracted war, Douyin is also stepping up the deployment of more platform closed-loop capabilities to retain local merchants.

For example, the merchant classification is more refined. Starting from June 1, commissions will be charged in the range of 2% to 8% according to different local industries. This will not only ensure the platform's revenue capacity, but also put forward more refined requirements for the cost operation of merchants, which is conducive to achieving the healthy and sustainable operation of local life.

Later, Douyin's local life operators also had their own exclusive options for traffic acquisition. In addition to the public DOU+ traffic, Douyin launched a marketing platform specifically for local life merchants in June - Local Push, which supports the promotion of stores or products through short videos and live broadcasts.

As a local life service platform under the ByteDance, ByteDance Local Promotion mainly promotes stores through short videos, promotes products through short videos, and promotes products through live broadcasts. It provides two port capabilities, APP and PC, to help local life merchants make marketing adjustments in real time to reduce costs and increase efficiency. From attracting new traffic to local operations, Douyin wants to retain merchants who have been attracted by the public domain, and transform the live broadcast room from a special period operation state to a normal operation capability.

However, in the eyes of some local merchants, the difficulty is still quite high. Most national brands build their own teams, and take the ROI path of one live broadcast room facing national traffic, which is ultimately converted to local stores, which can be more cost-effective. In contrast, regional brands want to build a team to operate live broadcasts on a regular basis, which is costly and the effect is unpredictable. Most of them choose to outsource to local operating teams, which means that if the effect is good, the cooperation can continue, but if the effect is not good, the cooperation will be interrupted.

Therefore, in the eyes of many small and medium-sized businesses, Douyin's public domain operations can be seen as a stimulant for store operations, and can be done when needed, such as during festivals, new product launches, etc.; but it may take time for Douyin's local life to become a normalized operating platform before they can seriously consider whether to set up a full-time team.

3. A methodology that requires growth and visibility

In addition to accelerating the construction of service ecosystem capabilities on the platform, service providers who can standardize and replicate live broadcast capabilities are also another type of partners for Douyin to fight a protracted war. This year's popular "Do you want to make coffee?" should be the biggest surprise of Douyin's local life business.

As a phenomenal nonsense, it became one of the hottest topics in the mouth of a female anchor known as "Big Mouth Girl". When everyone was still talking about whether T97 would be the next Luckin Coffee, and the operator behind it began to be involved in more controversies, more T97 imitation shows began to emerge in Douyin live broadcast rooms.

Along with phenomenal traffic, nonsense literature has also poured into the live broadcast rooms of more catering brands: from the leading new tea brand Heytea, to the fast food brand giant KFC, and even Haidilao around Christmas.

Hot products, local traffic, and imitation, when these three words are put together, they seem to symbolize that Douyin's local life has entered a new stage of standardized replication.

This explosive growth has further boosted the traffic excitement of local businesses. However, in the view of Hao Hao, head of brand marketing for the restaurant chain:

"The live streaming rooms of popular internet celebrities are lively but have no brand. They attract new customers in the short term but abandon customers in the long term. All entrepreneurs want growth, but if they cannot master the growth methodology, they will always feel uncertain about the growth."

If the phenomenal service provider IP is just a profile of local life agency operations, more local life marketing space gives Douyin more means of attack; but in the nearby algorithm business ecosystem dominated by the platform, every hot-selling emotional moment of a local life merchant seems to be alerting another group of local operators who cannot see through Douyin's black box methodology.

Xiang Biao, an anthropologist from Wenzhou, once proposed the concept of "disappearing neighborhood" to express that in the development of modern society, the society in which people live is becoming something to be abandoned and left.

However, with the development of mobile Internet, this disappearing neighborhood has become another new neighborhood ecology in digital form. However, in this digital neighborhood connection, the opacity of Douyin's centralized control always makes operators who rely on physical locations feel less in control.

After all, in the local life market, there are always new players chasing traffic carnival, leaving a trail of traces with lightning speed. But in the eyes of old players who are trying to figure out long-term business capabilities, bending over and burying their heads is the correct posture for local life.

The so-called business among acquaintances within three to five kilometers, no matter how good the calculation is, it cannot beat the passage of time and human relationships.

Author: Gu Er; Editor: Yi Ye;

WeChat public account: New entropy (ID: baoliaohui)