Meituan to Launch KeeTa Delivery Service in Riyadh as CEO Expands Overseas Business
- tech360.tv
- May 1, 2024
- 2 min read
Meituan plans to launch its food delivery brand, KeeTa, in Riyadh, Saudi Arabia. The move comes as Meituan seeks to expand beyond China amidst declining domestic consumption. Meituan's CEO, Wang Xing, emphasises a cautious approach to international expansion.
The move comes as Meituan seeks to expand its operations beyond China amidst a decline in domestic consumption. According to Bloomberg, the launch in Riyadh will mark Meituan's first foray into the Middle East.
The decision to expand internationally is significant for Meituan, as many Chinese companies are looking to tap into overseas markets due to uncertainties surrounding the future growth of the tech sector at home. Meituan's CEO, Wang Xing, emphasised the company's cautious approach to international expansion, stating, "I think it may take us another 10 years to make a significant impact in overseas markets, and we are not in a hurry to do that."
In February, Wang took direct control of Meituan's global business, signaling a strategic shift towards international growth. The company's entry into Hong Kong last year yielded positive results, prompting Meituan to actively evaluate opportunities in other markets. Meituan executives, including Wang and Head of Strategic Overseas Investments Zhu Wenqian, visited Saudi Arabia in May to assess the feasibility of a food delivery pilot scheme and held meetings with local government officials and members of the Saudi royal family.
Meituan is poised to compete with established players such as Delivery Hero, Deliveroo, and Jahez in the Middle Eastern market. According to data from Statista, the online food delivery market in Saudi Arabia is projected to grow at an annual rate of 5.62%. Meituan's success in Hong Kong under the KeeTa brand can be attributed to its high subsidies, which enable the company to offer attractive discounts to customers. In 2023, KeeTa captured a 21% market share by GMV (Gross Merchandise Volume) in Hong Kong, rapidly gaining ground against its competitors.
While Meituan's stock price experienced a dip in February, it has been gradually recovering. However, it is still only a quarter of its peak value in mid-2021. The expansion into Riyadh and the broader international market presents an opportunity for Meituan to diversify its revenue streams and capitalise on the growing demand for food delivery services.
Meituan plans to launch its food delivery brand, KeeTa, in Riyadh, Saudi Arabia.
The move comes as Meituan seeks to expand beyond China amidst declining domestic consumption.
Meituan's CEO, Wang Xing, emphasises a cautious approach to international expansion.
Source: TECHNODE
