Analysis of Ele.me’s membership system!

As part of a series of membership analysis articles, we have previously analyzed Meituan’s membership system . Today, let’s analyze Ele.me ’s membership system.

As we all know, as an important manifestation of the new economy, takeaway catering is the leading market in the "eating, drinking, playing and traveling" of local life services. Due to its large number of users, high frequency of consumption, strong stickiness, and huge revenue potential, the capital market has given it a high valuation.

Take Meituan as an example. It has become the third largest Internet company in China with a valuation of 1.4 trillion yuan because food delivery accounts for more than 40% of its revenue.

As a company with strong strategic foresight, Alibaba has long been involved in local life service e-commerce. After acquiring Ele.me in 2018, it has invested tens of billions of yuan to provide all-round support to Ele.me, striving to gain the initiative and control in the confrontation between local life service e-commerce and Meituan.

2. Analysis of Ele.me Membership System

The Ele.me membership system was launched in 2017, and the bonus system and membership tasks were introduced early on. In response to operational needs, Ele.me made a major upgrade and adjustment to its membership system in July 2020, launched a new foodie bean system, and redesigned the membership system. Currently, Ele.me's overall membership system is as follows.

From the above picture we can see that Ele.me’s membership system includes two major membership systems: ordinary foodie card (free) and super foodie card (paid).

Registered users can receive a Foodie Card. After receiving the Foodie Card, they can earn Foodie Beans by ordering takeout on Ele.me. They can get Foodie Beans for every RMB 20 spent. 50 Foodie Beans can be exchanged for store red envelopes, large-amount discount red envelopes, etc.

Users can also pay to purchase a Super Foodie Card, which costs 10 yuan per month. In addition to receiving four 5-yuan red envelopes, the biggest highlight is that the foodie beans they receive are five times that of ordinary foodie card users.

Let’s first analyze the membership benefits of the Super Foodie Card. In the case of continuous automatic monthly subscription, users only need to spend 10 yuan per month (new users only need 1.99 yuan in the first month) to obtain the following benefits.

Monthly 20 yuan bonus:

There are 4 red packets of 5 yuan per month with no threshold. Each red packet can be used to directly deduct cash on any takeout order. This is the core benefit of super members and the biggest selling point that impresses users to purchase membership.

5 times the foodie beans:

Super members can get 500 foodie beans for every 100 yuan spent, which can be exchanged for a 5 yuan red envelope. This is approximately equivalent to a 5% rebate, which is very attractive to users.

Upgrade large bonus:

Users can upgrade their ordinary 5 yuan red envelopes to large merchant red envelopes of 6-11 yuan. This is similar to Meituan’s design, and Meituan also has a similar mechanism.

50% off bonus:

If the 20 yuan red envelope every month is not enough, you can purchase additional red envelopes at a 50% discount. For example, 5 yuan can buy 2 red packets of 5 yuan each, and 10 yuan can buy 4 red packets of 5 yuan each. It also looks very cost-effective.

10% off special red envelope:

You can buy red envelopes at a 50% discount. For example, 100 foodie beans, or 1 yuan, can be exchanged for a Pizza Hut red envelope worth 10 yuan. I believe this benefit is still very attractive to foodies.

From the rights and interests of super members, we can see that the most core right of Ele.me Super Foodie Card members is red envelopes. If you spend 10 yuan every month to get a super foodie card, you can get 4 red envelopes of 5 yuan each with a total value of 20 yuan. For a foodie, as long as he orders takeout three times a month, he can earn back the membership fee.

Moreover, the value of these red envelopes can be magnified. A single 5-yuan red envelope can be exchanged and upgraded to a large red envelope of 6 to 11 yuan at a merchant, helping users save more money. If the user’s red envelopes are not enough, he or she can spend money to purchase additional red envelopes at a 50% discount, so the value of this membership is obvious.

Taking a member who orders takeout six times a month as an example, after calculation and comparison, we can find that users who activate the Super Foodie Card can save 13.7% more than those who do not. If members pay more than 20 yuan per order, they can also get 5 times the foodie beans, and the rebate rate is about 5 percentage points.

It is understood that the average order frequency of Ele.me's super members is 2.3 times that of ordinary users, the average order value is much higher than that of ordinary users, and the average consumption per member is 39% higher than that of ordinary users.

What is worth mentioning here is the Foodie Beans. I have analyzed Meituan’s membership in the previous issue. We can find that the biggest difference between Ele.me members and Meituan takeaway members is the points system that Ele.me has focused on building - Foodie Beans. For users, no matter whether they are super members of Ele.me or not, as long as they place orders and complete tasks on Ele.me, they can earn foodie beans.

It can be seen that Foodie Beans is a global strategy in Ele.me's membership operation strategy. It is not only aimed at paid members with high loyalty and stickiness, but also further lowers the threshold to ordinary users with low frequency and less activity.

But I found that there are certain restrictions on the collection of Foodie Beans, that is, the payment amount must be more than 20 yuan before you can collect it. This will largely exclude orders using red envelopes. For such users, they will only have a chance to get Foodie Beans if they order at least a takeaway worth 25 yuan or more. Therefore, based on this condition, Ele.me's Foodie Beans system is biased towards high-value users with high average order value and strong payment capabilities.

That is to say, on Ele.me you not only have to eat a lot, but also have to eat well, then Ele.me's foodie beans will be given to you in large quantities. Therefore, I think the design concept of Ele.me's foodie beans is consistent with that of Taobao's 88VIP membership, which is to give welfare subsidies to those users who contribute the most to the platform and retain them firmly. However, for users who only order takeout for 10 yuan per meal and try every means to take advantage of the platform, it will be difficult to obtain Foodie Beans.

Having a Foodie Beans system alone is far from enough. You must also make users aware of the value of Foodie Beans and drive them to earn and consume them. Therefore, a good membership operation system will use various means such as points lottery, points games, member points day, etc. to stimulate users.

Ele.me has designed various ways for users to obtain Foodie Beans, such as placing orders and completing tasks. In addition to these daily activities, Alibaba’s best marketing activity is creating festivals. Taking the familiar Double 11 as an example, it can be written into the world’s Internet marketing textbook. Under the impact of the Double 11 shopping carnival craze, most people learned to buy things online, which led to a surge in Taobao's GMV and created today's Alibaba business empire.

Nowadays, Ele.me has also started to create festivals. It is understood that Ele.me held its first Bean Festival before the 10.1 holiday, with the theme of "Sharing 100 Million Foodie Beans". Users can share Foodie Beans by placing orders, playing games and completing tasks. Just like Double 11, in order to expand its influence, Ele.me has teamed up with big brands such as Starbucks and Papa John's to carry out activities. A cup of Starbucks Caramel Macchiato originally cost 33 yuan, but foodies only need 1,200 foodie beans to redeem one cup.

There is another point I want to make. I think large-scale marketing activities will play a very important role for industry platforms. They can not only expand the influence of the platform and quickly increase transaction volume, but more importantly, they can shape a cultural trend and even promote the direction and trend of the industry. The best proof is that in every Double 11 event, new consumer brands have continued to emerge, driving the continuous upgrading and iteration of China's retail consumption.

When I was analyzing Meituan's membership system earlier, I discovered that compared with Alibaba's strong operational and festival-creating capabilities, Meituan is relatively weak in this regard. Although Wang Xing proposed Meituan's core strategy of Food+Platform, our perception of Meituan is still a food delivery platform. We rarely see Meituan holding nationally influential events on FOOD.

3. Analysis and evaluation of Ele.me members

To sum up, we have conducted a comprehensive evaluation and analysis of the Ele.me membership system.

1. Strong synergy effect under Alibaba ecosystem

First of all, it should be emphasized that when evaluating Ele.me's members, we need to stand from the perspective of Alibaba's ecosystem, rather than observing and analyzing Ele.me itself in isolation. We need to comprehensively consider the penetration effect of Alibaba's e-commerce's 846 million monthly active users, rather than just Ele.me's takeaway market users. We need to start from Alibaba's 88VIP membership system, rather than being limited to Ele.me's own membership system.

In particular, as an 88VIP member of Alibaba's No. 1 project, you can enjoy various super membership benefits and Tmall discounts in Alibaba's ecosystem such as Ele.me, Youku, Xiami, and Tao Piaopiao at a super value price of 88 yuan. The combined value of these discounts is at least one thousand yuan.

There is no doubt that this 88VIP membership is extremely lethal. Take me as an example. I used to recharge my membership on Meituan and order takeout every month, but since I opened 88VIP, I have never recharged my membership on Meituan again. Wouldn’t it be nice to get a super membership of Ele.me for free?

Therefore, from a purely financial perspective, Alibaba is undoubtedly losing money, but in terms of long-term value and user experience, it has firmly glued users to Alibaba's ecosystem and met their one-stop needs, which reflects Alibaba's long-term value orientation and strategic vision.

2. The Foodie Doufan Points System has become a major attraction

As a heavyweight boxer competing on the same stage with Meituan, Ele.me has taken a different path of exploration from Meituan. Based on the Super Foodie Card paid membership, Ele.me launched a Foodie Beans points system with a lower threshold. From the perspective of design and marketing, the interesting, novel and fun Foodie Beans can help Ele.me attract young user groups and increase its paid membership conversion rate.

Author: Chen Wenzhong

Source: Code Ant showing off its muscles