[On :freetrade:] Baidu (BIDU) 💻

Hi

I have read a little about meituan-dianping which is really eating in Baidu’s market share and is still a newish company do you know anything about them?

Hi, I’m not following these companies WRT to their financial positions but I can give my two cents from the consumer’s point of view.

Meituan.com (started as “Groupon” of China) and Dianping.com (which means “review” in Chinese and dominate that market in China) used to be two companies and by no means were small players in their respective fields before the merge. Their CEO, Xing Wang, is a quite famous entrepreneur. He found the “twitter” (FanFou.com) of China years ago but banned by the Chinese government, for the obvious reason, and that’s the start of the “Weibo.com” (listed on NASDAQ) as well.

It’s true that they entered the food delivery market after Baidu, but I think they are better positioned and they’ve got a much better CEO to execute their plan. Baidu used to be invested in a big competitor of Meituan, called “eleme” (“ele.me”, which means “are you hungry” in Chinese) but I think they sold their stake (not sure if it’s all of them or not) to Alibaba and started their own food delivery business.

I don’t order much takeaways when I’m back in China, but I do see Meituan’s delivery men much much more than Baidu’s. In fact I can’t remember seeing any of Baidu’s delivery men.

Baidu is pretty much known as just a “search engine” company in China and they’ve not been too successfully in other areas and I think it’s largely down to their CEO being too comfortable and lack of competitions in their own market for too long.

US has “FANG” or “FAANG”, China has “BAT” (Baidu, Alibaba and Tencent). People have been saying that it should be just “AT” or something else + “AT” now. You can see why by just comparing the market cap of these companies.

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https://www.ft.com/content/23e0a0d7-16c5-41a6-9ce3-47f1f58464cc

Baidu said first-quarter revenue fell 7 per cent from a year earlier to Rmb22.5bn ($3.2bn) as advertisers in travel, autos and healthcare cut back on spending during the public health crisis. Revenue at its core search and news feed business fell even faster, sliding 13 per cent from the same period last year.

The epidemic had driven housebound Chinese users to spend more time on online entertainment platforms and advertisers had sought to follow this shift, said Raymond Feng of research firm Pacific Epoch.

“Universal search is facing a growth bottleneck as traffic stays locked inside apps like WeChat and Douyin,” said Alex Liu of China Renaissance. “It’s inevitable that advertisers will continue to migrate to mobile display ads in those apps.”

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