China’s food delivery platforms went head-to-head over the past weekend, triggering a fierce price war that overwhelmed drink shops, crashed apps, and sent delivery riders scrambling — while customers placed scheduled orders days in advance and reaped the benefits of eye-watering deals.

The frenzy began on Saturday, when leading players including Meituan, Alibaba’s Taobao Flash Sales and Ele.me, and JD.com’s new delivery arm rolled out a wave of deep-discount vouchers, such as “24 yuan off when you spend 25” and “15 yuan off 15.” Taobao’s Flash Sales platform introduced a new user coupon of “18 yuan off 18,” and Meituan collaborated with beverage brands to offer “0-yuan milk tea” promotions.

On social media, users shared screenshots of their orders: milk teas for just 1 yuan ($0.14) and 51 yuan fried chicken combo meals down to 1.1 yuan. Customers even showed screenshots of their advance orders stretching across the three days of deals.

The promotions drew an overwhelming number of orders. Meituan’s app briefly crashed on the evening of July 5 due to record-breaking demand. By around 11 p.m. on Saturday, Meituan reported over 120 million same-day orders through its instant retail system, with over 100 million coming from food delivery orders.

On Monday, Taobao Flash Sales and Ele.me jointly announced that their daily orders had exceeded 80 million, with over 13 million coming from non-food items.

The price war traces back to April, when JD.com announced its entry into the food delivery market — posing a direct challenge to Meituan, which currently dominates the sector. In May, Alibaba launched Taobao Flash Sales — granted prominent placement on the company’s hugely popular Taobao e-commerce app’s front page — and teamed up with Ele.me to bolster its instant retail business.

Since then, the platforms have fiercely competed by distributing generous coupons to lure customers, and occasionally required government regulator intervention. After its launch in May, Taobao Flash Sales has seen rapid growth, with daily orders rising from over 40 million in late May to more than 60 million by the end of June.

Last Wednesday, Taobao Flash Sales announced a 50-billion-yuan investment in direct subsidies for consumers and merchants over the next year — a move that some industry insiders say ignited the weekend’s price war. The timing coincided with what is widely seen as the first weekend of the summer consumption season, traditionally a peak period for delivery promotions.

The delivery battle among China’s tech giants not only sent apps crashing and orders soaring — it also left drink shops overwhelmed and workers stretched to their limits.

One Auntea Jenny tea shop in Shanghai, a participant in Meituan’s “0-yuan coffee” campaign, reported that just four staff members produced nearly 3,000 beverages in a single day. According to domestic media, many Shanghai-based tea shops saw daily orders double to 300 to 500 requests, far above their usual pace. One delivery rider reportedly set a personal record, completing 127 orders in a day and earning over 1,700 yuan.

That boom also meant chaos. Some users complained about long wait times or receiving incorrect orders. On social media, buyers shared how some delivery riders grabbed whatever they could at pick-up points, as the stores were in disarray.

In response, some merchants removed their best-selling items or even disabled delivery services to cut online orders. Some shopkeepers said that despite the order surge, profits didn’t always follow.

“The more orders we get, the more we’re subsidizing on behalf of the platform,” a staff member at Auntea Jenny told domestic media. “A day might show over 10,000 yuan in revenue, but after deducting subsidies, it’s barely 6,000. Factor in costs for drinks, labor, rent, and utilities — sometimes we’re making less than 1 yuan per cup.”

According to Chen Liteng, digital life analyst at the e-commerce research center 100EC, the short-term upside of such promotions is clear: consumers enjoy rock-bottom prices, and high-frequency consumption habits are reinforced. But in the longer term, he warned of price dependency — once the subsidies vanish, order volumes may plummet, and overconsumption could lead to waste.

He also said that massive subsidies might exacerbate the divide between large chains and smaller vendors. “For smaller merchants, the subsidy battle forces them to shoulder higher costs, while well-funded chain brands use their capital advantage to seize market share. This intensifies pressure on smaller sellers and pushes the industry ecosystem toward consolidation and dominance by top players,” Chen said.

“For platforms, the surge boosts short-term numbers, but at the cost of massive subsidies and potential system instability,” he added.

Editor: Tom Arnstein.

(Header image: VCG)