This article is reproduced from All Weather Technology, author Zhang Chao
"SaaS for enterprise services is a long cycle in the next 10 years."
"Unicorn Catcher" Zhu Xiaohu made such a prediction in April last year.
Looking at it now, it is not just VC/PE institutions that are grabbing the beach for SaaS service companies, but also Internet giants such as Ali and Meituan.
Recently, it has been reported that, in the second half of 2020, the local life service platform of Alibaba, Koubei, has completed the wholly-owned acquisition of the smart catering service provider "don't wait for delicious food". A few days ago, both parties have completed all settlements.
This is also another important piece that Ali has dropped on the B-side of local life after acquiring local life SaaS service providers such as Cloud.
The official website shows that "Don’t wait for delicious food", established in January 2013, is a smart catering service provider. Through to B’s SaaS services and to C products, it solves the problems of restaurant efficiency, management, marketing, cost and customer dining experience. .
Up to now, "Don't wait for delicious food" has covered more than 300 cities across the country, serving more than 100,000 restaurants, and providing catering services for nearly 1 billion consumers every year.
With the C-end traffic dividend peaking, deploying the B-end and grabbing SaaS to help catering companies realize digital transformation has become an important goal of the new stage of local life service platforms.
As the largest domestic local life service platform, Meituan Dianping has also been actively operating in the catering sector to B-end services in recent years, with a layout in all aspects of upstream and downstream catering, including supply chain, SaaS, digital marketing, financial support, and takeaway delivery. .
In addition, third-party enterprise service companies, such as Weimeng and Youzan, have also stepped into the middle link of the catering supply chain, making this segmented track more lively.
A protracted battle around the B-side of catering is ongoing.
Why fight for the B-side?
In the catering field, the role of local life service platforms in the past has always been a tool connecting merchants and consumers. The main role is to accumulate traffic and cooperate with all links of the supply chain to meet consumers' catering needs.
Ali and Meituan trudged all the way through the "price subsidy war", fighting all the way to compete for users, while the war between them also burned to the B side.
"In the past two decades, the digitalization on the demand side of the digital economy industry has been gradually completed, but the digitalization on the supply side has only just begun. Technology companies should not want to subvert traditional offline companies, they should integrate and develop." The fifth session held in 2018 At the World Internet Conference, Meituan-Dianping CEO Wang Xing mentioned that Meituan-Dianping continues to "build roads" in the back-end of catering, and wants to take a large and comprehensive path of integrated development with enterprises and merchants.
Catering to B service is a trillion-dollar market, and it is also destined to be a market where giants compete cruelly.
According to the "2019 Catering Industry Big Data Monitoring and New Business Model Research Report" released by iiMedia Research, China's catering industry revenue has reached 4271.6 billion yuan in 2018, officially entering a new era of 4 trillion yuan; 2014-2019 , The number of stores in China's catering service market is also on the rise. In 2019, the number of fully-serviced restaurant stores reached 7,118,100, the number of fast food stores was 1.8279 million, and there were 404,300 food stalls.
The huge number of catering companies means that the B-end market is also full of imagination. Their digital upgrades and efficiency improvements have become the entry point for Ali and Meituan to force the B-side.
A digital transformation of the catering industry around the supply chain, SaaS services, digital marketing, financial payment, and takeaway delivery has emerged at the historic moment. The new crown epidemic has accelerated the speed of this digital transformation.
The "Chinese Catering Merchant Digital Research Report" released by Meituan Research Institute shows that the penetration rate of digital services in the catering industry is not high at this stage. Although takeaway is the main form of digitalization of catering merchants, the penetration rate is only 14%, such as order analysis The penetration rate of digital services such as membership management, online decoration, online cashier, and online purchase is even lower than 10%. There is still much room for digital transformation in the catering industry.
Image source: Meituan Dianping
As early as November 2019, Alibaba's local life service platform formed by the merger of Ele.me and Word of Mouth released a "new service" strategy, which aims to equip merchants with service tools and provide digital solutions to help merchants reduce costs and increase efficiency , Realize the transformation of digital intelligence.
After the strategy was released, a major move of Alibaba's local life service platform was to announce in February 2020 that its subsidiary Koubei had acquired catering SaaS service provider Ruyun.
Generally speaking, catering SaaS service providers mainly provide catering companies with system software services such as reservation, ordering, cashier POS, takeaway, and membership management.
Although Keruyun is a leading player in the catering SaaS industry, it is not the largest and best domestic POS system. The outside world is full of doubts about why Ali acquired the company.
However, Keruyun has a prominent feature that it is simple to deploy, fully functional, friendly to the management interface, and high in value. This provides convenience for B-end small and medium-sized merchants, lowers the threshold for use, and facilitates the promotion of software and products.
After a lapse of one year, Word of Mouth was exposed again to complete the acquisition of "delicious food without waiting". It is similar to Keruyun, both of which are catering SaaS service providers. So, why does Ali want to buy "don’t wait for delicious food" in similar businesses?
From the perspective of business scope, most of the functions of catering SaaS service providers mainly focus on merchant-side services such as cashiers, reservations, and membership marketing, while "don’t wait for delicious food" are mainly for the consumer side, providing services such as online queuing and real-time reporting. It is also a rare catering SaaS product that serves users at both ends of B and C at the same time.
It is reported that O2O platforms such as Dianping, Ctrip Gourmet Forest, and Wowo Tuan have now been connected to the service of “don’t wait for delicious food”.
From guest-like cloud to "don't wait for delicious food", Ali is all in the bag, at least it shows that it is increasing all aspects of the catering B-side service and fully promoting the digitalization of the catering industry.
Meituan Dianping, which has 480 million annual transaction users and has an absolute advantage in the food delivery field, is obviously not outdone. Soon after Ali announced the acquisition of Keruyun, Meituan-Dianping was also exposed as a stake in the catering SaaS service provider "Walaila".
In addition to providing information management services such as "ordering + cash register + store inventory management" for merchants, one of the points worthy of attention is that it has an Internet payment license and an Internet micro-loan license, which can provide payment and similar services. Financial Services. This also makes Meituan Dianping's layout at the B-side restaurant more complete.
Under the capital action of the giants, catering to B companies are gradually being drawn into the camp of Ali and Meituan, and competition means more and more.
Meituan and Ali's dining B-end layout
In the past, the transformation of catering merchants by local life service platforms mainly focused on online information and transactions, helping merchants conduct online marketing and attracting traffic.
Today, Ali and Meituan-Dianping's two major life service platforms have become more and more in-depth in the catering field. Seek to meet the needs of businesses in all aspects of IT system, operation, finance and supply chain, and realize the Internetization of industries from upstream to downstream.
Image source: iResearch
Meituan Dianping has accumulated 6.5 million annual active merchants and 480 million annual transaction users in its past group buying, review and takeaway businesses. Relying on its huge user resources and big data advantages, Meituan-Dianping has tried to transform the industry from model innovation to efficiency transformation along the "six empowerments", namely marketing, IT, operation, finance, supply chain and logistics.
Since 2016, Meituan Dianping has entered the post-catering market, focusing on building its own infrastructure capabilities, launching an open catering platform, and establishing a catering ecological business department to achieve full coverage of all links from the supply chain to the operation of businesses;
Of course, in order to further deploy smart catering, Meituan Dianping has also expanded its catering to B-side service camp through investment and acquisitions.
At present, the to B business of Meituan Dianping's catering sector is growing strongly. The financial report of Meituan-Dianping shows that new businesses including B2B catering supply chain services will achieve 8.2 billion yuan in revenue in the third quarter of 2020, an increase of 43.5% year-on-year, accounting for 23.16% of total revenue.
But at the same time, this business is still a "golden beast." In 2018, Meituan Dianping lost 1 billion yuan in its new business, including B2B catering supply chain services; by 2019, its gross profit reached 1.3 billion yuan, initially achieving profitability. However, due to the impact of the epidemic and increased business investment, operating losses reached 2 billion yuan in the third quarter of 2020.
Different from Meituan Dianping's large-scale logic, another "big mountain" on the local life track-Ali's play is to build ecology.
In the field of catering services, Ali does not make software by itself, but uses its own technology to build channels, allowing third parties to provide plug-ins and customized software to achieve online and offline omni-channel data connection.
In order to promote the intelligent development of B-end digital, in January 2019, Ele.me launched the "3 1 million" strategy: to help 1 million offline merchants to go online, empower 1 million merchants to upgrade digitally, and create 1 million jobs; In March of the same year, Ele.com announced that it would sink to 100 third- and fourth-tier cities to serve local businesses and users. From the two dimensions of the number of stores and coverage, Alibaba has gradually built its own catering B-end ecosystem.
In addition, Ali has improved the layout of its catering industry chain through investment and acquisitions, and included some catering service providers under its command. Compared with Meituan Dianping, it seems that it does not seek more, but refinement and depth. One of the benefits brought by this is that the platform can directly undertake the existing business and traffic of the service provider and rapidly expand the market share.
With the development of catering digitalization today, the key to business transformation is to improve efficiency, including the efficiency of traffic coordination and the efficiency of business acquisition and retention. Catering SaaS, as a tool that connects the B and C ends, helps the digital transformation of the supply chain, reduces costs and increases efficiency, and becomes one of the key nodes in the competition between Ali and Meituan.
Even behind some popular catering SaaS with high market share, there are still many giants. For example, "Don't wait for delicious food." Before it was acquired by Ali, it had received investment from Internet giants such as Ctrip, Meituan Dianping, and Baidu.
All-weather science and technology observations found that Meituan Dianping mainly relies on self-built services to reach merchants in the supply chain and financial payment links. In terms of business and IT system links such as ranking, ordering, and membership management, it is deployed through investment and acquisition.
According to incomplete statistics, Meituan-Dianping has already deployed 11 companies in its catering to B-side business, which is more than twice that of Ali.
On the whole, the two companies also have obvious differences in their layout strategies: Meituan has a large camp in supply chain, operation and IT systems; Ali has a relatively more diversified layout in the financial payment link. However, neither side has left any part of catering to B, but is getting deeper and deeper in this field.
Ali employee Li Lin (pseudonym) revealed to All-weather Technology that the word-of-mouth sales team even ties up a "second code" to customers when selling customer-like cloud products, that is, ordering, payment and settlement small programs, thereby enhancing the active merchants and activeness of Alipay. Number of users; this has also become one of the KPIs for Alibaba's high-level local life.
With the completion of the key node of SaaS service, the digitization process of catering B-side is also accelerating, and the closed loop of industry data ecology may be formed.
The challenge of Ali and Meituan Catering To B
In addition to the two centralized platforms of Alibaba and Meituan, Weimeng and Youzan, a decentralized platform developed by relying on private domain traffic, are also sharpening their knives in catering to B services to compete for cakes.
The financial report shows that thanks to the key development of vertical sectors such as e-commerce, retail, and local life, Weimob’s SaaS business revenue in 2019 was 507 million yuan, a year-on-year increase of 46.1%; the company’s cooperative catering merchants reached 4,602, and revenue accounted for SaaS business 7.8% of total revenue.
In order to develop the smart catering business, Weimob has increased the layout of its catering SaaS services in 2020: first announced the acquisition of 63.83% of Yazuo’s equity in February to achieve control of the latter; then in April, it invested in a smart business service provider "commercial "Yes", to further increase refined services in the field of food delivery.
These are not enough. In order to further strengthen the smart catering business, in May 2020, Weimob also established a smart catering company, which consists of five business lines: smart restaurant, cashier, cashier, member, cost butler, and merchant takeaway, forming a collection of members, cashier, takeaway, A full-scenario integrated digital solution integrating shopping malls, ordering, booking, and supply chain management.
Recently, Weimob has also expanded the C-side traffic acquisition channels, connecting smart catering to the Alipay applet, thereby helping merchants increase customer acquisition and exposure, and continue to empower the digitalization of catering brands.
Weimeng Smart Catering Access Alipay Mini Program
Youzan has also released a "new catering" integrated solution: in the take-out scenario, you can complete services such as scanning code and ordering, receiving coupons, and paying bills, helping merchants eliminate platform commissions, increasing conversion rates and repurchase rates ; In the dine-in scenario, it can help businesses realize self-service ordering, multiple people ordering at the same time, and online payment.
In today's rapid development of catering digitalization, due to differences in resources, products, and models, different companies play very different roles in the supply chain.
IResearch mentioned in the "China Smart Catering Industry Research Report" in 2018 that the industry is in the highly competitive Spring and Autumn Period. On the one hand, many players continue to enter the game. On the other hand, the merger and integration of old players accelerates to achieve complementary advantages.
If Alibaba’s acquisition of “you don’t have to wait for deliciousness” and Meituan’s acquisition of Screenchip Technology is just a game of big fish eating small fish, after a series of actions such as Weimob Holdings Yazuo, this showdown gradually shows the meaning of PK between new and old players. .
It is worth mentioning that behind Youzan and Weimob are the common shareholder Tencent. They enjoy the nourishment of the huge flow of WeChat.
Perhaps the biggest challenge facing Meituan Dianping and Ali is not the external predators, but their own. The strongest castles are usually disintegrated from within.
In the to B-end competition, Meituan Dianping still adopts a "price war". It is reported that the cost of traditional catering software and hardware and systems is mostly tens of thousands of yuan, while the Meituan cash register is basically around 1,000 yuan, and some single-screen cash registers are even only a few hundred yuan, which makes many service providers in the same industry complain.
With the direct marketing model adopted by Meituan Dianping, marketing and operating costs will continue to rise as the geographical scope expands.
Bai Xiufeng, Dean of Meituan’s Catering Institute, once revealed that Meituan’s investment in the B-side business is very large in the short term, and the digitalization of catering businesses is a long process, and many places need to be transformed.
Looking back at the development of the catering SaaS industry, in the past, many companies eventually fell because they could not afford the cost of sales and market education.
For Meituan Dianping, perhaps money is not a problem. Even if the new business loss in the third quarter of this year has increased by 66.67% year-on-year, the company still said it will stick to the investment.
Alibaba's reliance on digital systems may have a slight advantage on the marketing side, but since its main business relies on acquired companies, the bigger problem lies in business integration and efficiency improvement.
Li Lin told All Weather Technology that after Alibaba acquired Keruyun, more energy and time have been spent on enterprise integration and organizational adjustments. On the contrary, progress at the business level is not obvious.
"It was originally planned that Keruyun would fully get through with Ali by the end of September 2020, but it was not completed, and it was postponed to the end of December." Li Lin mentioned that on the one hand, it is because there are more people in Keruyun, and more importantly. Ali's local life lacks internal execution, and the task is delayed in landing, resulting in delays in the final plan.
According to him, "Before January 1, 2020, Keruyun will basically level off with Ali, and there is still finishing work that needs to be completed before February 1."
For Meituan-Dianping, how to better integrate the companies invested or acquired is equally important.
At present, the to B service in the catering sector is still a protracted battle.