China’s online food delivery market is one of the largest and most dynamic in the world, with the market valued at approximately $70 billion in 2023. This explosive growth has been fueled by a rapidly expanding urban population, increased smartphone penetration, and the rise of digital platforms, which have transformed the way consumers access food. The convenience, affordability, and variety offered by online food delivery services have made them increasingly popular across all demographic groups in China.

With the rise of major platforms such as Meituan, Ele.me, and Dianping, the market has become highly competitive, with both domestic and international players seeking to capture a share of the growing demand for food delivery. In addition, the growing emphasis on contactless delivery and technology-driven services has further shaped the sector, creating new opportunities and challenges for operators.

This report provides a comprehensive overview of the online food delivery market in China, covering key trends, market segments, consumer behaviors, competitive dynamics, and emerging technologies shaping the industry.

Key Drivers of Growth in the Online Food Delivery Market

Rapid Urbanization and Changing Lifestyles

China’s rapid urbanization has been one of the most significant factors driving the growth of the online food delivery market. With more than 60% of the population now living in urban areas, the demand for convenient, ready-to-eat food has surged. Urban residents, particularly in first- and second-tier cities, are increasingly seeking alternatives to traditional dining out, turning instead to food delivery services for convenience, variety, and speed.

As urban lifestyles become busier and time pressures increase, consumers are more inclined to use online food delivery to save time and avoid the hassle of cooking or going out to eat. The rise of two-income households, single-person households, and working professionals in cities is further propelling this demand, contributing to the steady growth of the market.

Proliferation of Smartphones and Internet Connectivity

China is one of the world’s largest markets for smartphones, with over 1 billion mobile phone users and over 800 million internet users as of 2023. The widespread use of smartphones has been a crucial factor in the growth of the online food delivery market. Mobile apps such as Meituan, Ele.me, and Baidu Waimai have become central to the food delivery ecosystem, enabling consumers to order food seamlessly from a wide range of restaurants and food vendors.

The increased availability of high-speed 4G and 5G networks has also contributed to the rapid expansion of the online food delivery market, making it easier for users to place orders, track deliveries, and access real-time promotions and discounts. In 2023, approximately 80% of all food delivery transactions in China were made via smartphones.

Shift in Consumer Preferences and Dining Habits

Consumer preferences in China have shifted toward more convenient and flexible dining options, driven by the desire for variety, speed, and customization. Online food delivery services cater to this demand by offering consumers a broad selection of food options, from traditional Chinese dishes to international cuisine, as well as the ability to customize orders based on individual tastes and dietary preferences.

The rise of food delivery subscriptions, meal kits, and healthy eating options has also influenced consumer behavior. Increasingly, consumers are using online platforms not only for takeout but also to access specialty diets, organic foods, and gourmet meal delivery services, creating new opportunities for market players.

Government Policies and Regulation

The Chinese government has implemented various policies to support the growth of the online food delivery market, while also addressing challenges related to food safety, labor conditions, and environmental sustainability. In 2023, the government introduced stricter food safety regulations for delivery platforms, requiring them to ensure the quality and hygiene of food and packaging during transportation. This is in response to growing concerns over foodborne illnesses and the quality of delivery service.

Additionally, the government has been encouraging digital innovation and the integration of artificial intelligence (AI), big data, and smart logistics into the food delivery sector. These technologies help to improve the efficiency of delivery operations, optimize routes, and enhance customer satisfaction, contributing to further market expansion.

E-Commerce Growth and the Integration of Online and Offline Experiences

The online food delivery market in China is increasingly integrated with other e-commerce and digital services. Major platforms like Meituan and Ele.me are expanding beyond food delivery to offer a variety of services, such as grocery delivery, restaurant reservations, and hotel bookings, creating a seamless, integrated digital experience for consumers.

As the line between food delivery and broader e-commerce becomes increasingly blurred, the market has seen the rise of social commerce and live-streaming as promotional tools for food vendors. Live-streaming platforms such as Douyin (Chinese TikTok) and Kuaishou have become key sales channels, allowing food businesses to interact with customers in real-time, provide cooking demonstrations, and offer exclusive discounts and deals.

Market Segments in the Online Food Delivery Market

Restaurant-to-Consumer Delivery (R2C)

Restaurant-to-consumer delivery is the most prominent segment of the online food delivery market in China. This model involves food delivery platforms facilitating the ordering and delivery process directly between consumers and restaurants. In 2023, the restaurant-to-consumer market segment was valued at approximately $45 billion, representing 65% of the total online food delivery market.

Key Features of Restaurant-to-Consumer Delivery

• Wide Range of Choices: Consumers can access a wide variety of food options from both local and international restaurants, enabling them to order meals from virtually any type of cuisine.
• Convenience and Speed: Delivery services are typically offered with fast delivery times, often within 30-45 minutes. Platforms optimize delivery routes using AI and big data to reduce delivery times.
• Real-Time Tracking: Many platforms provide real-time tracking of deliveries, allowing consumers to follow their order from restaurant preparation to doorstep delivery.

Delivery Aggregators and Platforms

Platforms such as Meituan, Ele.me, and Baidu Waimai dominate the restaurant-to-consumer delivery space in China. These platforms function as intermediaries, providing a digital marketplace where consumers can browse, order, and pay for food from a wide variety of restaurants.

Popular Platforms and Their Services

• Meituan: Meituan is the largest food delivery platform in China, with over 500 million monthly active users. In addition to food delivery, Meituan offers services related to grocery delivery, movie ticketing, and hotel bookings.
• Ele.me: Owned by Alibaba, Ele.me is one of the leading players in the Chinese food delivery market, offering services ranging from restaurant delivery to grocery and pharmacy delivery.
• Baidu Waimai: Baidu Waimai, affiliated with the search engine giant Baidu, focuses on providing efficient delivery services, with an emphasis on local restaurant options.

Grocery Delivery and Meal Kits

The market for grocery delivery and meal kit services has seen rapid growth in China, driven by consumers’ demand for convenience and fresh ingredients. In 2023, the grocery delivery segment was valued at $12 billion, with meal kit services generating significant traction, particularly among urban families and professionals looking for easy-to-prepare, healthy meal options.

Key Players in Grocery Delivery and Meal Kits

• Hema (by Alibaba): Hema is Alibaba’s fresh food and grocery delivery service, allowing consumers to order groceries online for delivery or pick-up. The platform focuses on fresh, high-quality products sourced from local farms and international suppliers.
• JD.com: JD.com’s grocery delivery service, 7FRESH, offers consumers a variety of fresh produce, packaged goods, and prepared meals with quick delivery options.
• Meituan’s Maicai: Maicai is a popular grocery delivery service offered by Meituan that focuses on fresh ingredients and affordable meal kit options.

Cloud Kitchens and Virtual Restaurants

The rise of cloud kitchens (also known as virtual kitchens) has become a significant trend in China’s online food delivery market. Cloud kitchens are food preparation facilities that serve multiple restaurants or brands but operate entirely through delivery platforms. These kitchens enable restaurant operators to reduce overhead costs and expand their reach without the need for physical storefronts.

Growth of Virtual Restaurants

Virtual restaurants are operated exclusively through online food delivery platforms and do not have a physical dining space. These restaurants are able to scale rapidly by offering a specific type of cuisine or by expanding their menu offerings to meet diverse customer demands. Many traditional restaurants are also turning to virtual models to increase delivery sales and improve operational efficiency.

Dark Kitchens and Delivery-Only Models

In addition to cloud kitchens, dark kitchens—which are optimized for delivery-only orders—are gaining traction. These kitchens typically operate in low-rent areas and serve multiple platforms to maximize their reach. The dark kitchen model has proven successful for quick-service restaurants (QSRs) and fast-casual concepts looking to enter new markets with lower costs.

Consumer Behavior and Trends in the Online Food Delivery Market

Rising Demand for Healthier and Sustainable Food Options

As Chinese consumers become more health-conscious, the demand for healthier, organic, and sustainable food options is increasing. Online food delivery platforms are responding by offering more plant-based and organic meal choices. In 2023, the demand for healthy food delivery increased by 15%, with a notable rise in consumers opting for meals with fewer calories, organic ingredients, and sustainable packaging.

Key Trends in Healthy Food Delivery

• Plant-Based Meals: The rise of plant-based diets and alternative proteins has led to an increase in the availability of plant-based dishes through food delivery platforms.
• Sustainable Packaging: As consumers become more environmentally conscious, there is a growing demand for eco-friendly packaging and zero-waste food delivery options.

The Rise of Online Grocery Delivery and Meal Kits

Grocery delivery services and meal kit subscriptions have gained traction, particularly in larger cities. Consumers are increasingly relying on online platforms to purchase fresh ingredients, snacks, and pre-packaged meals. The convenience of receiving groceries and ready-to-cook meal kits has made these services attractive to time-conscious professionals and families.

Integration of Technology and Data Analytics

AI, big data, and machine learning are playing a growing role in the online food delivery market in China. These technologies are being used to enhance customer experience through personalized recommendations, optimized delivery routes, and inventory management. Predictive analytics is helping companies better understand consumer preferences and forecast demand, enabling more accurate deliveries and enhanced customer satisfaction.

Use of Contactless and Digital Payment Solutions

The adoption of contactless payments and digital wallets has transformed the food delivery experience in China. Platforms like WeChat Pay and Alipay are widely used for seamless, secure, and cashless transactions. The use of QR codes, digital payment systems, and electronic invoices has streamlined the payment process, reducing friction and improving convenience for consumers.

Major Players in China’s Online Food Delivery Market

Meituan

Meituan is the largest food delivery platform in China, with over 500 million active users in 2023. Meituan offers a wide range of services, including restaurant delivery, grocery delivery, movie ticketing, and hotel bookings. The platform is known for its fast delivery services, user-friendly app, and wide range of restaurant options.

Ele.me

Ele.me, owned by Alibaba, is one of the leading food delivery platforms in China. The platform covers over 2,000 cities across China and offers a variety of services, including restaurant delivery, grocery delivery, and on-demand logistics. Ele.me competes directly with Meituan in the food delivery space, focusing on delivery speed and customer service.

JD.com and 7FRESH

JD.com, a leading e-commerce platform, operates the 7FRESH grocery delivery service, offering consumers a variety of fresh produce and pre-cooked meals. JD.com has expanded into food delivery to diversify its services and reach a broader consumer base.

Baidu Waimai

Baidu Waimai is a food delivery service operated by Baidu, one of China’s largest internet companies. Baidu Waimai focuses on providing a fast and reliable food delivery experience, leveraging Baidu’s search engine and AI capabilities to optimize food orders.

Future Outlook for the Online Food Delivery Market

Expansion of Grocery and Meal Kit Delivery Services

The grocery and meal kit delivery sectors are expected to continue expanding as consumers demand greater convenience and access to fresh ingredients. Online platforms will likely deepen their integration with local farms and grocery suppliers to offer faster delivery times and a wider range of products.

Technology-Driven Services

Technology will play an increasingly vital role in the future of food delivery. The integration of AI, big data, and smart logistics will continue to optimize delivery processes, improve operational efficiency, and create better customer experiences. The use of robotic delivery vehicles, drones, and autonomous vehicles is expected to revolutionize last-mile delivery in the coming years.

Sustainability and Eco-Friendly Practices

As sustainability becomes a growing concern among consumers, food delivery platforms are likely to adopt more eco-friendly practices. This will include the use of biodegradable packaging, carbon-neutral delivery options, and green logistics solutions.