Strategies Meituan Can Use to Grow from A Billion Dollar Company to A Trillion Dollar Company Like Alphabet Inc. (Article Sample)

Strategies Meituan Can Use to Grow from A Billion Dollar Company to A Trillion Dollar Company Like Alphabet Inc. Few companies achieve billion-dollar valuation, while even fewer reach trillion-dollar valuation. Only six companies have achieved the latter. While it may be difficult to conceptualize the gap between one billion and one trillion, an apt analogy can be made using time as a measure, whereby one billion seconds is approximately 31 years, whereas one trillion seconds is about 31,688 years. In the current tech-dominated society, huge corporations are expanding at an unbelievable pace. Reaching a trillion-dollar valuation is now perceived as the pinnacle of business achievement. As of August 2023, there were six trillion-dollar companies on the market, five of which, like Meituan, are in the technology industry. These are: 1 Apple - $2.8 trillion. 2 Microsoft - $2.4 trillion. 3 Saudi Aramco - $2.2 trillion. 4 Alphabet - $1.6 trillion. 5 Amazon - $1.3 trillion. 6 NVIDIA - $1.1 trillion. Meituan, a Chinese tech firm worth billions, faces a challenge in achieving a trillion-dollar valuation similar to Alphabet Inc. By examining Alphabet's successful growth and key strategies, Meituan can learn valuable insights to overcome this hurdle and establish itself among the trillion-dollar giants. Comparison Alphabet Inc., the holding company of Google, is a global technology conglomerate with a strong focus on innovation. Its prime subsidiary, Google, dominates the global search engine industry. Alphabet's corporate structure includes Waymo and DeepMind. Meituan started as a meal delivery business and now offers hotel reservations and ride-sharing services. With millions of daily users, Meituan is at the forefront of China's technology upheaval due to its focus on convenience and efficiency. Characteristic Alphabet Inc. Meituan Market Capitalization US$1.3 trillion HK$98.17 billion (approx. US$12.4 billion) Number of Employees 175,316 107,380 Regional Offices United States, Europe, Asia, Africa, South America China, Asia, North America, Europe Core Industry/Service Internet search, cloud computing, advertising E-commerce, local services Other Industries/Services Artificial intelligence, life sciences, self-driving cars, venture capital Food delivery, ride-hailing, bike-sharing, hotel and travel booking Companies Owned/Under Google, DeepMind, Calico, Waymo, CapitalG Dianping, Mobike, Wanghong, Chongqing Sankuai Micro-credit Co., Ltd., Meituan Waimai, Meituan Dianping Technology (Shanghai) Co., Ltd. Revenue and Profit US$280.9 billion (2022) HK$179.1 billion (approx. US$22.7 billion) (2022) Global Reach Global China Market Position Leader in Internet search, cloud computing, and advertising Leader in e-commerce and local services in China Table SEQ Table \* ARABIC 1: Comparison of Alphabet Inc. and Meituan as of 16th September 2023 Strategies for Achieving Trillion-Dollar Valuation Some of the strategies that Meituan can adopt to become a trillion-dollar company like Alphabet Inc. include the following:- 1 Global Expansion 2 Research and Innovation 3 Data Monetization Global Expansion The solid foothold of Meituan in mainland China has helped it grow into a triumphant company worth billions. To reach a trillion-dollar value, Meituan needs to broaden its global footprint. Exploring new markets through international expansion will provide Meituan with a broader scope for income and decrease its vulnerability to fluctuations in a single market. Also, by becoming a global player, the company has the opportunity to adapt its services towards regional preferences and consumer behaviors - this can result in an expansion of its customer audience. This puts Meituan in a prime position to harness the growing worldwide appetite for technological resolutions, innovative business models, and ease of use. The path to global expansion can be taken through:- 1 Diversification of Services 2 Expansion to New Markets 3 Acquisition of Other Companies Diversification of Services Diversifying services is a strategic move that can significantly aid Meituan in global expansion. There are commonalities and differences in the strategies adopted by Meituan and Alphabet Inc. The early concentration of Meituan on food delivery is like Google's initial supremacy in search engines. However, by using its subsidiaries like Waymo, DeepMind, and Nest for penetration into various industries - a tactic shown in this approach - Alphabet has made significant strides. The industry sectors that Alphabet has been able to penetrate include:- * Internet Search * Online Advertising * Cloud Computing * Operating Systems * Video Sharing * Artificial Intelligence * Self-Driving Cars * Smart Devices * Life Sciences * Biotechnology * Urban Development * Robotics * Venture Capital * Quantum Computing * Energy * Digital Payments Meituan is mainly involved in e-commerce. Using Alphabet's approach, Meituan can generate a network of services meeting different customer wants and needs. The broadening of revenue avenues through diversification enhances Meituan's financial strength and intensifies its market visibility. Company Service/Industry Sector Dianping Online reviews and recommendations Mobike Bike-sharing Wanghong Food delivery Chongqing Sankuai Micro-credit Co., Ltd. Micro-lending Meituan Waimai Food delivery Meituan Dianping Technology (Shanghai) Co., Ltd. The technology company that develops and operates the Meituan Dianping app Dada Nexus On-demand retail delivery Manbang Group Online freight transportation Ucar Group Used car trading Table SEQ Table \* ARABIC 2: A Table Showing the Service/Industry Sectors Served by Meituan’s Constituent Companies Expansion to New Markets Branching out into fresh markets is critical for Meituan to become truly international. Meituan, primarily established in China, can extend its influence globally, like Alphabet, by penetrating different global markets. Subsidiaries of Alphabet like Google, YouTube, and Waymo have expanded their reach globally by tailoring their services to fit local languages and cultures. In the same way, Meituan can customize its services, like food delivery and ride-sharing, to fulfill the unique needs and desires of emerging markets. This broadening doesn't just boost Meituan's consumer following but also mitigates the risk tied to heavily banking on a lone market. Just as Alphabet has seen enhanced financial results from expanding globally, so too can Meituan exploit untouched markets through international growth. It allows them to mix their revenue streams and forge a path towards reaching recognition as a global company with worth in trillions. Alphabet’s (then known as Google) acquisition of Android in 2009 enabled the company to reach virtually every market in the World, which in turn played a significant role in the increase of its market capitalization from $17.3 billion in 2009 to $193.5 billion in 2013, a year-over-year growth of 1027%. Acquisition of Other Companies Google's ownership of companies like YouTube and Waze enhances its services, market reach, and impact. Meituan can leverage this by taking over local firms or startups in specific markets, gaining a large established clientele, local market expertise, and well-developed infrastructure. The "build or buy" policy allows Meituan to acce...