Meituan Dianping, China’s largest on-demand services provider, is poised for a comeback to the power bank sharing business, as it looks to expand its revenue sources and enhance user stickiness, LatePost reported on Monday.
The move comes after the firm encountered several failed attempts in 2017, after rolling out the service in cities including Shijiazhuang in Hebei province and Qingdao in Shandong province. The company quickly stopped further rollouts after three months due to “a lack of synergy with its other businesses,” Wang Huiwen, Senior Vice President, said in an open letter published in November 2017.
This time, Meituan plans to deploy an unspecified number of sharing stations across the nation, the report said, citing people familiar with the matter. Rather than the original white-and-green version, these new power banks will appear in the iconic “Meituan Yellow,” which is used for the company’s logo and delivery men’s uniforms.
Meituan Dianping didn’t immediately respond to KrASIA’s request for comments on Tuesday.
The popularity of smartphones and the mass adoption of mobile payments have helped increase the demand for shared power banks in China over the past few years. Charging stations have been placed in some of the busiest venues like restaurants, malls, libraries, and airports, coming to the rescue when users’ mobile phones run out of juice.
Consumers can usually pick up a charger without paying any deposits, as most of the bank sharing companies let users rent the device as long as they have a “Sesame Credit Score” of over 600 points. Sesame credit is a feature developed by Alibaba’s fintech arm Ant Financial to analyze users’ creditworthiness.
Chinese users of shared power banks are expected to hit 305 million by the end of 2019, up from 196 million last year, Chinese consulting agency iiMedia said in a report in July.
The power bank sharing market is profitable, and can be monetized more smoothly compared to co-sharing bikes, market watchers said. Companies usually buy a power bank for as low as USD 4, which can be used for more than 300 times, according to a report from Chinese news outlet RedStar. Users pay between USD 0.14 and USD 1 per hour.
Currently, the business in China is dominated by Jiedian, which has a market share of 40.5%, with more than 107 million reported users. Xiaodian and Guaishou have market shares of 23.6% and 20.9% respectively, iiMedia data shows.