Alibaba to Merge Restaurant Review Business into Map App AutoNavi
Chinese e-commerce giant Alibaba plans to merge its restaurant review business (previously known as Koubei) with its AutoNavi map app, according to a report by local media outlet LatePost on March 22.
Yu Yongfu, who is a partner at Alibaba, as well as the President of the company’s life service sector and the Chairman of AutoNavi, stated that the organizational changes were a strategy to facilitate business growth.
The decision to merge Alibaba‘s restaurant review business with AutoNavi was announced in a meeting on March 22. The meeting, which exceeded its planned duration of 45 minutes, did not address specific issues such as the course of the Koubei team after the merger or how Koubei-related business will be implemented by AutoNavi. In the upcoming quarter, AutoNavi and Koubei will explore how to integrate and determine the key direction of development after an initial run-in period. There have been no changes in stock holding or salary for Koubei’s team members for the time being.
Koubei, a local lifestyle website founded in 2004 by former Alibaba employee Li Zhiguo, had an initial short-lived run. Alibaba acquired Koubei and merged it with Yahoo China and Taobao, but the platform failed to attract a significant user base.
Following the failure of Koubei, Alibaba pursued other opportunities in the local lifestyle business. In 2013, Lu Zhaoxi, then CEO of Alibaba, launched the restaurant and food app “Taodiandian,” using various “shopping festivals” to attract users. However, the platform struggled to compete with rivals Meituan and Ele.me in terms of the selection of merchants and quality of service. As a result, Koubei was relaunched in 2015 with the goal of competing against Meituan and helping Alipay promote offline payment.
After Alibaba acquired the food delivery company Ele.me, Koubei was relegated to a lesser role in the local lifestyle business, mainly focusing on restaurant reviews. In early 2022, LatePost reported that Koubei’s catering business coverage shrank from 40 cities to just 11 cities.
Koubei has faced challenges in its development, while AutoNavi has experienced steady growth to become one of Alibaba‘s most successful businesses in recent years.
At the Alibaba Investor Conference in late 2021, Yu expressed his belief that maps are the most effective tool for navigating the real world. He expressed his hope that AutoNavi could be leveraged to enable users to find food, clothing, housing, and transportation options. This would include not only locating refueling and charging stations but also discovering restaurants and booking hotels through the map feature.
After Koubei is merged into AutoNavi, there may be increased potential to experiment with additional business ventures. On March 21, Starbucks launched a brand-new retail channel in China called “Starbucks Curbside” through its collaboration with AutoNavi, providing orders to customers on the go.
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Koubei is currently facing intense competition, with its biggest rival being Douyin, which boasts 700 million daily active users. By investing more resources into the local lifestyle business, Alibaba is aiming to challenge Meituan‘s dominance in the market.