Yang Bai

Yang Bai of China International Capital Corporation Limited inquired about Dingdong's perspective on the intensifying competition within the instant retail market, particularly in fresh groceries, and how the company navigates challenges and identifies opportunities amidst increased investment from industry giants.

Answer

Founder and CEO Changlin Liang detailed Dingdong's strategy of proactive differentiation, emphasizing the 4G strategy to attract high-quality users with good products and a "one inch wide, one mile deep" approach to supply chain development, focusing on long-term efficiency and capability building over short-term price wars.

Yang Bai inquired about Dingdong's perspective on the current highly competitive instant retail market, particularly in fresh groceries, and how the company addresses challenges and identifies opportunities amidst significant investments from industry giants like Alibaba, Meituan, and Jingdong.

Answer

Founder and CEO Changlin Liang explained that Dingdong differentiates itself through a long-term strategy focusing on the 4G strategy (good products attracting good users for a high-quality user base) and a "one inch wide, one mile deep" approach to supply chain development, emphasizing direct sourcing, R&D, and digital infrastructure to build unique, resilient capabilities beyond short-term price competition.

Yang Bai from CICC asked for management's perspective on the current competitive environment, specifically within instant retail and the frontline fulfillment station market, and its resulting impact on Dingdong's business.

Answer

Founder and CEO Changling Liang explained that Dingdong's 'narrow and deep' strategy differentiates it from competitors focused on short-term price wars and traffic acquisition. He contrasted Dingdong's focus on supply chain development, long-term value, and collaborative partnerships with the 'zero-sum' approach of others. Mr. Liang emphasized that by aligning with consumer trends toward quality, health, and lifestyle, the 4Gs strategy has become a unique competitive advantage, positioning the company strongly despite market pressures.

Yang Bai from China International Capital Corporation requested an overview of the business situation for the internally incubated Gui Food Group.

Answer

CFO Song Wang provided a detailed overview of the Gui Food Group, outlining its strategic positioning, growth, product development, and export progress. He noted Gui is a key part of Dingdong's transformation into a full-chain food company, with 12 self-operated factories. In 2024, Gui's GMV on Dingdong was ~RMB 5 billion, with export revenue reaching ~RMB 300 million. Mr. Wang highlighted key brands like 'Black Diamond Family' and 'Thai Chongqin' and mentioned expanding partnerships with retailers in Hong Kong, Singapore, and the Middle East.

Yang Bai of CICC asked for an update on the development of Dingdong's self-developed factories and how its supply chain capabilities are extending to external sales channels.

Answer

CEO Liang Changlin explained that the company's 12 self-operated factories are central to its strategy of offering differentiated, high-quality products. He detailed the success of its premium 'Black Diamond Family' black pork brand, which saw GMV reach approximately CNY 60 million in Q3. He also revealed significant growth in external sales, with revenue from meat, cereals, and prepared meals hitting nearly CNY 100 million, a 180% year-over-year increase, underscoring the supply chain's potential.

Yang Bai of CICC inquired about NetEase's perspective on the competitive landscape of the shooting game sector, considering the company's pipeline of both self-developed and licensed titles in this genre.

Answer

Bill Pang, VP of Corporate Development, characterized the shooting game genre as a large and highly competitive market with a high barrier to entry, requiring top-tier art production and gameplay innovation. He affirmed NetEase's commitment to continued investment in the genre, expressing confidence in their ability to launch competitive products in the future.

Yang Bai inquired about the upcoming shooter game, Fragpunk, asking about its data from testing, launch preparations, post-launch operational priorities, and the company's view on the competitive landscape for shooter games.

Answer

Executive Bill Pang, translating for CEO William Ding, confirmed that Fragpunk's testing feedback met expectations and the game is ready for launch. Post-launch priorities include monitoring player feedback, providing updates, adding new characters, and ensuring a healthy gaming environment. Management is confident the game's unique style and design will appeal to both new and existing players, allowing it to succeed in a competitive market.

Yang Bai asked for elaboration on the global business, noting a cautious management tone and external data suggesting slowing growth, and questioned the company's risk management approach. He also asked how the intense competitive environment is impacting growth and investment priorities.

Answer

Executive Lei Chen acknowledged that the global business faces significant uncertainty from an accelerating pace of change in the external environment and non-business factors, which will inevitably cause disruptions. Co-CEO Jiazhen Zhao added that intense competition has already caused revenue growth to decline and that this trend is expected to continue. He stated the company's priority is to focus on its core strength by investing in supply chain innovation to meet diverse consumer needs.