The company is eyeing opportunities in the hotel and tourism sector, as China’s current local life market focuses on food and takeout services
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Douyin, the Chinese version of TikTok, has announced a CNY 50 billion (USD 7.42 billion) 2022 GMV goal of its local life services, up CNY 10 billion over the plan set at the end of 2021.
Douyin’s local life arm is planning to expand its business in first- and second-tier cities including Beijing, Shanghai, Chengdu, the capital of Sichuan province, and Hangzhou, the capital of Zhejiang province.
In these cities, the company expects to attract merchants on Meituan (03690: HK) with clout and financial subsidies. Meituan reacts by adding new consumption scenarios like live streaming in its offline group-buying services.
The penetration rate of the domestic local life market was 12.7% in June 2021, according to industry consulting company iResearch (Chinese: 艾瑞咨询).
Douyin’s life services software will start to charge fees from June 1, according to the company’s announcement.
Article by Yifan Zhang, EqualOcean.
