Food fuels China’s O2O Craze – Dianping case


“Where are we going for dinner? Someone Dianping it!”

Food has a special meaning to the Chinese people. For years, a new word “chihuo” appears among the young generation of Chinese people, which means foodie. They enjoy exploring popular restaurants and sharing their experiences on social networks. In prospect of increase in demands of this market, the Chinese e-commerce giants are taking rivalry to food. Dianping is one of the top location based service review platforms (also launched mobile APP). In 2015, Dianping (China’s Yelp) and Meituan (China’s Groupon) merged to form O2O service giant, valuing $15 billion.

As the world’s first independent third-party local review site, Dianping not only focus on food market, but also on sectors such as entertainments, shopping, films, beauty, taxi and other information services for people’s day to day living. Until Q1 2015, Dianping has got more than 200 million active users monthly, more than 14 million restaurants and shops were covered, and more than 15 billion individual reviews have been collected. (Source: baike.baidu)

In order to prosper in the highly competitive market, Dianping always focus on improving consumer’s consumption experience, by the ways of value co-creation, recommendation defaults and so on.

Active “Co-creators”

Engaging the users into value co-creation process is of vital importance for a leading user generated content platform. “Value” for Dianping is a joint function of the actions of the providers and the consumers and is therefore always co-created, which is in line with the theory of Vargo and Lusch, 2008. In this scenario, service-domain logic approach to co-creation is a good match for Dianping.

The mutual incentives for establishing a change in the traditional resource integration process are a must for the occurrence of value co-creation. (H., Kannan, 2013) For service providers of Dianping, they can explore new markets and gain more real-time customers by easily releasing online (group) purchasing activities. Using the word-of-mouth marketing via Dianping is also a cheap way for them to get their brand known. For customers, communicating with others by giving reviews on Dianping is a win-win relationship. Moreover, making reservation through Dianping can get a discount sometimes due to group purchase and coupon promotion service. The launch of Dianping VIP also helps to improve the customer relationship and retention.

dianping

Figure 1

Appropriate Recommendation

When companies get recommendation defaults right, they and their customers benefit. Dianping’s recommendation default is firstly designed based on the city location, as can be seen from Figure 1. The local information services will be rolled out when you enter the interface. The random recommendations based on the reviews of other users are automatically shown to you after you choose one sector, for example the restaurants. If you prefer personalized recommendations, you can customize it by sort function (for more details see Figure 2). One thing worth mentioning is that when you want to see the reviews that have hundreds of thousands, you can even search the reviews by selecting the key words you are interested in. It’s very user friendly and helps users to make decisions faster.

dianping-120312-2

(Figure 2. Source: thebeijinger.com)

Do you still want to have some fun with your friends or families after meal? No ideas? Just scroll down the screen, the recommendations of entertainments and shopping malls nearby can be found!

 

References:

Goldstein, D.G., Johnson, E.J., Herrmann, A., & Heitmann, M. (2008). “Nudge your customers toward better choices.” Harvard Business Review, 86(12), 99-105.

Vargo, S.L. and Lusch, R.F. (2008a), “Service-dominant logic: continuing the evolution”, Journal of the Academy of Marketing Science, Vol. 36 No. 2, pp. 1-10.

Saarijärvi, H., Kannan, P. K., & Kuusela, H. (2013). “Value co-creation: theoretical approaches and practical implications.” European Business Review, 25(1), 6-19.

http://baike.baidu.com/view/898309.htm

http://www.thebeijinger.com/blog/2012/03/13/expats-guide-trolling-dianping

http://www.brandslation.org/?p=75

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