Over the past few months, on-demand retail has reshaped China’s e-commerce landscape, intensifying competition among major retail players. Alibaba’s Taobao Instant Commerce has unlocked new growth opportunities by integrating multiple services, prompting the company to ramp up investment and consolidate resources. JD.com is aggressively expanding its footprint in this space, establishing a new business unit focused on hotel and restaurant channels. Meanwhile, Meituan announced a full-scale push into on-demand retail on June 23.
The underlying strategy for these giants is to attract users with high-frequency front-end services, before leveraging cross-selling to boost engagement and enrich their platform ecosystems to drive growth. During this year’s 618 shopping festival, traditional long-tail e-commerce growth slowed, while near-field on-demand retail experienced strong momentum. This shift is accelerating a broader rethink of business models and organizational structures across the industry, as players seek new sources of growth.
Why it matters: On-demand retail, especially for daily essentials and fast-moving consumer goods, is emerging as a critical battleground. Leading e-commerce companies are racing to capture this new trend with delivery speed and service frequency becoming key differentiators. The current surge mirrors some of the dynamics that have fueled the recent food delivery subsidy war.
Details: The growth driven by resource integration and cross-selling is evident across all three major players:
- Alibaba revealed in its fiscal 2025 Q4 earnings that Taobao Instant Commerce outperformed expectations both in scale and efficiency. During 618, the platform saw user activity and purchase counts hit new highs, with double-digit growth in buyer numbers and a 10% year-over-year increase in net transaction volume after refunds.
- JD.com shared a similar story. CEO Richard Liu noted during 618 media briefings that around 40% of consumers who used their on-demand services went on to buy e-commerce products, making these cross-channel conversions more cost-effective than traditional traffic acquisition.
- Meituan’s 618 results were equally impressive, with over 100 million orders placed and transaction values doubling in more than 60 categories. The company’s promise of “30-minute delivery” proved a compelling proposition in intensifying competition with traditional platforms.
Context: Both Alibaba and JD are driving growth by combining front-end convenience with optimized back-end supply chains. By strengthening cross-selling and user stickiness, they aim to build richer ecosystems.
- Organizationally, Alibaba’s November 2024 e-commerce restructuring brought together Taobao, Tmall, 1688, and Xianyu under one umbrella, coordinating closely with Ele.me and Fliggy, which remain independent but strategically aligned.
- Alibaba told TechNode that Taobao Instant Commerce is supported by a robust fulfillment network that integrates Ele.me’s rapid delivery and Cainiao’s multi-speed logistics, to maximize efficiency. Additionally, it gives brands unified tools to manage loyalty programs, pricing, and inventory across both traditional and instant commerce.
- On June 18, JD.com made an announcement about its new strategic moves in the hospitality and travel sectors, establishing a new business unit focused on hotel and dining services.
On June 23, Meituan revealed plans to fully expand its instant retail operations, signaling a major upgrade in its retail business models. As part of this push, Meituan made adjustments to its flash sales and select stores business operations, including expanding its reach overseas.
