Competitive Analysis and Response Strategies Between Taobao Flash Purchase and Meituan Instant Retail

Based on the latest market developments, I will systematically analyze the competitive landscape between Taobao Flash Purchase and Meituan in the instant retail sector, as well as Meituan’s response strategies.

According to multiple data sources, the current instant retail market presents a “three-way stalemate” structure:

Platform	Market Share	Core Strengths
Meituan	~60%	Instant delivery network, rider resources
Taobao Flash Purchase	~30%	Product variety, Alibaba ecosystem synergy
JD.com	7%-8%	Strength in 3C category, self-operated logistics

According to industry data, in December 2025, the order share between Meituan and Taobao Flash Purchase changed from the previous 55:45 ratio; Meituan’s share rose slightly, but its overall share continues to face challenges [1][2].

:

• In Q4 2025, Taobao Flash Purchase recorded a loss of approximately RMB 20-25 billion, but its loss reduction rate is faster than that of competitors [1]
• Peak daily orders reached 120 million, with daily active users exceeding 200 million [3]
• After the integration of Hema, daily orders exceeded 2 million, representing a year-on-year growth of over 70% [2]
• Non-catering orders stabilize at 10 million per day, and the gap with the leading player continues to narrow [2]

:
Alibaba has clearly stated that Taobao Flash Purchase’s primary goal is market share growth, and it will firmly increase investment to become the absolute market leader [2]. The Research Institute of the Ministry of Commerce predicts that the scale of China’s instant retail market will exceed RMB 1 trillion in 2026 and is expected to reach RMB 2 trillion by 2030 [2].

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Meituan’s Q3 2025 financial report shows:

• Net loss reached RMB 18.6 billion, the largest single-quarter loss since its 2018 IPO [4]
• Selling and marketing expenses surged 90.9% year-on-year [4]
• Goldman Sachs estimates that Meituan incurs an average loss of approximately RMB 1 per instant delivery order [4]

Meituan’s core challenges include:

Dimension	Meituan’s Shortcomings	Taobao Flash Purchase’s Advantages
Product Variety	Mainly focuses on catering and supermarket standard products	Integrates Tmall, Hema, and Tmall Supermarket with a full range of goods
Brand Supply	Insufficient coverage of brand merchants	Strong ecosystem synergy capabilities
User Perception	Stigmatized as a “food delivery tool”	Top-level entry on Taobao homepage with strong traffic diversion

Industry analysis points out that Meituan’s moat—its instant delivery network and rider resources—is being gradually eroded by Taobao Flash Purchase through its “City as Warehouse” strategy [5].

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According to a report from Leiphone, Meituan executives clearly stated during investor communications:

• To capture the vast majority of market share and profits in the food delivery sector
• Maintain a share of over 70% in the mid-to-high order value market (orders above RMB 15 and RMB 30) [1]

Meituan CEO Wang Xing stated bluntly during the earnings conference that price competition is “involutionary” competition, which does not create value for the industry and is unsustainable [4]. However, in the face of share erosion, Meituan has no choice but to follow up with subsidy competition.

:

• In October 2024, it announced a partnership with over 10,000 brands to build “Official Flagship Flash Warehouses” [3]
• Covered brands include over 100 brands such as Sony PlayStation, Proya, Logitech, Kingston, Mao Geping, and L’Oréal [6]
• Meituan Vice President Xiao Kun stated that by 2027, Meituan’s Flash Warehouses will exceed 100,000, with an expected market scale of RMB 200 billion [6]

:

• Continue to expand Flash Warehouses to reduce fulfillment time and costs
• Improve category coverage and operational efficiency
• Achieve business model innovation and value creation [4]

Meituan is building service barriers from the following aspects:

• Fulfillment Efficiency
  : Strengthen the reliable experience of 30-minute delivery
• After-Sales Service
  : Introduce instant return and exchange services for high-value categories such as 3C digital products
• Quality Assurance
  : Improve product quality and brand credibility [6]

Data shows:

• Meituan’s instant retail orders in lower-tier markets such as counties grew 54% year-on-year [6]
• In 2026, it may focus more on third-tier and below cities, suburban areas, and emerging towns [6]

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Direction	Specific Initiatives
Supply Chain Deepening	Competition for brand merchants, expansion of front warehouse network
Service Experience	Fulfillment efficiency, product quality, after-sales guarantee
Scenario Expansion	Transformation from “emergency purchase” to “lifestyle”
Lower-Tier Markets	Penetration into third-tier and below cities

• Subsidy Reduction
  : As the issue of “revenue growth without profit growth” emerges among leading catering giants, the intensity of the food delivery war may show a slowing trend [4]
• Efficiency First
  : Who can accumulate capabilities after “burning cash” and find a balance between efficiency and service will determine the true direction of the market in 2026 [6]
• Ecosystem Integration
  : Far-field e-commerce and near-field e-commerce will further integrate, with physical stores becoming part of the instant retail infrastructure [4]

Although Meituan still has advantages in its instant delivery network and rider resources, its core challenges include:

1. Taobao Flash Purchase is rapidly expanding its product range with the support of Alibaba’s ecosystem synergy
2. JD.com focuses on its advantageous 3C category to form differentiated competition
3. Sustained loss pressure requires a balance between market share and profitability

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The rise of Taobao Flash Purchase is reshaping the instant retail landscape, and Meituan is facing dual pressures of share erosion and huge losses. Meituan’s response strategies feature a dual-track “defense + counterattack” approach: on one hand, it maintains core market share through subsidies and brand building; on the other hand, it accelerates supply chain layout and category expansion to build full-category goods capability.

In the long run, the endgame of this competition may not be a “winner-takes-all” scenario, but rather both parties finding their respective value anchors through differentiated positioning—Meituan focusing on instant delivery efficiency and service experience, and Taobao Flash Purchase leveraging its product variety and ecosystem synergy advantages. The key to success will depend on who can faster complete the transformation from “traffic subsidy-driven” to “efficiency-driven”.

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[1] Leiphone - “Taobao Flash Purchase Sets Flag to Compete for No. 1, Meituan Refuses to Back Down” (2026-01-09)
[2] Fast Moving Consumer Goods Network - “Alibaba Clarifies 2026 Strategy: Increase Investment in Taobao Flash Purchase to Become Absolute Market Leader” (2026-01-09)
[3] Southern Metropolis Daily - “After Burning Hundreds of Billions, Instant Retail Shifts from Traffic Subsidies to Competing for Lifestyle Super Entrances” (2026-01-07)
[4] China Business Journal E-Paper - “Instant Retail Battle: Who Bleeds and Who Grows?” (2026-01-05)
[5] OFweek - “Meituan Flash Purchase VS Taobao Flash Purchase: The Ultimate Battle Between ‘Nearby’ and ‘Full Range of Goods’” (2025-12-23)
[6] Eastmoney - “After Burning Hundreds of Billions, Instant Retail Shifts from Traffic Subsidies to Competing for Lifestyle Super Entrances” (2026-01-07)