2025-06-11 15:49Summary of the Conference Call on Ele.me's Q2 Local Life - Flash Purchase Business Industry Overview - The conference call focuses on the local life service industry, specifically the flash purchase business of Ele.me, a major player in the food delivery and e-commerce market in China. Key Points and Arguments 1. Order Volume and Growth - In 2025, Ele.me's daily order volume for the flower category is approximately 40,000, with peak days like May 20 reaching 600,000 orders. The average order value remains stable at 100 yuan. The supermarket convenience segment saw a year-on-year growth of 30% in May, while the flower segment grew slightly less by 5% [1][6][3]. 2. Impact of Meituan's Regulatory Issues - Following Meituan's regulatory scrutiny in March 2025, Ele.me expanded its supply aggressively, particularly in lower-tier cities and suburban areas, significantly increasing the number of merchants. Monthly cash incentives for previously underserved areas can reach 20,000 to 30,000 yuan [1][7]. 3. Commission Rates and Revenue Structure - Ele.me's commission rate for warehouse-store integration increased from 5% in 2024 to 6% in 2025. The flower business charges a 10% service fee, while supermarkets and convenience stores have varying commission structures [12][11]. 4. Advertising Revenue - Advertising income primarily comes from merchants and brand partners, contributing about 1 yuan per order from supermarkets and convenience stores. The overall advertising expenditure is around 6% for warehouse stores [13]. 5. Market Competition and User Behavior - The market is highly competitive, with Ele.me's daily order volume reaching 750,000, which is 2-3 times that of Meituan. However, the overall traffic growth has plateaued [14][15]. 6. Integration with Taobao Flash Purchase - The integration with Taobao's flash purchase service has led to a significant increase in orders for supermarkets and convenience stores, with non-main site traffic rising from under 20% to 50%. However, actual order growth is around 30%, indicating some user migration rather than new user acquisition [21][22]. 7. Profitability of Flash Purchase Business - The flash purchase business is currently operating at a loss, with average spending per order in 2024 being 1 yuan for convenience stores, 6 yuan for supermarkets, and 10-12 yuan for flowers. In 2025, additional subsidies are expected to impact these figures [26][27]. 8. Future Development Focus - Ele.me plans to concentrate on expanding customer frequency and product categories in nine key cities and an additional twenty cities, prioritizing these areas for major marketing activities [20]. Other Important but Overlooked Content - User Experience and Merchant Costs - The subsidy strategy significantly affects merchant costs and user experience, with merchants potentially increasing their costs by 5 yuan monthly to subsidize users, especially during holidays [29]. - 京东's Shift in Strategy - 京东 (JD.com) is shifting its focus towards food delivery and away from retail flash purchases, using substantial consumer subsidies to drive growth in the restaurant sector, which has led to a 1:1 order ratio with Ele.me in convenience store orders [32][33]. - Market Penetration and City Focus - Ele.me does not strictly categorize cities but focuses on nine major cities and twenty others for marketing efforts, with these top cities accounting for about 30% of GMV [19]. This summary encapsulates the critical insights from the conference call, highlighting Ele.me's strategies, market dynamics, and competitive landscape in the local life service industry.