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This case reviews the development of Dianping. After seeing Zagat's unique business model in the United States, founder Zhang Tao found that he could bring it to China and bring about local innovation. At the beginning of its establishment, the collection and promotion of comment content was the major challenge for Dianping. At the same time, Dianping faced legal issues. To solve these problems, the review mechanism of Dianping was designed to a certain extent to ensure the fairness of the review. With the advent of the mobile Internet era, Dianping began to develop a new business model. Relying on its high-quality “word-of-mouth” content and mass basis, Dianping launched group buying, online restaurant ordering, and other businesses. Dianping has always been open to strategic partners. Since 2015, Dianping has undergone historical changes, merging with Meituan. Since then, Dianping has continuously adjusted its business and organizational structure to maintain its competitiveness. Gradually, Dianping has changed from an independent business entity into a business unit of Meituan.

Students will be able to analyse competitive situations of the focal firm in the platform market, factors that make the focal firm become dominant in the sharing economy through the technology platform and the focal firm’s motives and growth strategies through mergers and acquisitions and overseas expansion, as well as give recommendations on the focal firm’s strategies to move forward to achieve and maintain its competitive position in the platform market.

On 4^th April, 2018, Meituan-Dianping (Meituan), a Chinese group-buying website for consumer products and retail services acquired Mobike, a Chinese dockless bike-sharing platform for US$2.7bn. Mobike had raised several rounds of funding for its large investments and operations in this highly competitive and cash-intensive industry. However, it was still struggling to survive and make a profit in the Chinese and overseas markets. It was believed that the merger between the companies was the only viable alternative. Had Meituan’s Chief Executive Officer made the right decision in acquiring Mobike? After Mobike became an integral part of Meituan, what should be done to turn this technology platform to be profitable in the Chinese and overseas market?

The case is intended for senior undergraduate or graduate-level courses in business schools.

Teaching Notes are available for educators only.

CSS 11: Strategy.