Alibaba shifts Tmall merchants to Taobao instant commerce

Alibaba has launched a campaign to bring over 260 merchants from its Tmall platform to its Taobao Instant Commerce site, intensifying competition with Meituan in China’s on-demand delivery market.

Alibaba, based in Hangzhou, aims to deliver food and consumer goods in under an hour through its revamped Taobao Shangou service.

Alibaba reported that Taobao Shangou reached a peak of 120 million daily orders last month, with average daily orders at 80 million, and monthly active users at 300 million.

Alibaba’s shares rose 3.4% in Hong Kong on September 9, 2025, while Meituan’s stock fell 2.3% amid ongoing price competition.

🔗 Source: South China Morning Post

🧠 Food for thought

Implications, context, and why it matters.

Instant commerce expansion comes with industry-wide profitability challenges

Alibaba’s aggressive push into instant delivery reflects a broader industry trend where companies prioritize market share over immediate profitability, with adjusted EBITDA falling 21% despite 10% revenue growth in their latest quarter 2.
The competitive dynamics are affecting all major players; Meituan’s adjusted net profit collapsed 89% due to what the company called “irrational competition” in food delivery, while JD.com’s net income fell 51% despite 22.4% revenue growth 3.
Quick commerce requires costly infrastructure including localized distribution hubs and dense logistics networks, creating significant operational expenses that pressure margins across the sector 4.
This situation demonstrates how the race for instant delivery market share is forcing companies to accept short-term profitability hits while building the infrastructure needed to compete effectively.

Defensive strategies driving massive infrastructure investments in instant delivery

Alibaba’s mobilization of Tmall merchants represents a defensive strategy to protect its user base from competitors like Meituan, who have established strong positions in instant delivery 4.
The scale of investment is evident in Alibaba’s rapid growth metrics—Taobao Shangou reached 300 million monthly active consumers (triple the April level) and 2 million daily active couriers, indicating massive resource deployment 1.
The competitive pressure is intensifying with new entrants like ByteDance’s Douyin integrating instant delivery services, forcing established players to accelerate their investments to maintain market position 5.
This defensive positioning explains why Alibaba is consolidating its premium Tmall merchants onto its instant commerce platform—leveraging existing relationships to quickly scale service offerings rather than building from scratch.