Keeta, the international arm of China’s biggest food delivery app, Meituan, has become the third-largest food delivery platform in Saudi Arabia just four months after its overseas debut. Its aggressive, price-slashing strategy is squeezing smaller players and challenging dominant platforms in the lucrative Middle Eastern market, which could be a springboard for other international markets.
Since Keeta launched in Saudi Arabia last October, it has taken 10% of the Saudi food delivery market in terms of order volume, according to a recent report from Bengaluru-based business consulting firm Redseer. Its market share as of January has surpassed that of more than 10 smaller delivery apps, and challenges the domination of the country’s two locally developed platforms HungerStation and Jahez, the report’s lead researchers told Rest of World.
Keeta is offering vouchers at sign-up and has waived delivery fees for orders since entering the Saudi market last year.
Such rapid expansion raises questions about whether the Chinese app can replicate its playbook to challenge food delivery peers like Talabat, Careem, and Deliveroo as it expands in the Middle East and beyond, analysts said.
“Keeta is using the price-disruption playbook to gain scale,” Sandeep Ganediwalla, a managing partner at Redseer who led the report, told Rest of World. The platform has been offering vouchers, free delivery, and discounted meals to lure customers. “We are seeing the majority of the impact being felt by the smaller players and not so much by the leading players — yet.”
The company’s internal assessment shows it has secured third place in the market, a Keeta manager in Riyadh confirmed to Rest of World. Keeta’s goal is to become the top player as soon as possible, the employee said, but did not provide a timeline. They requested anonymity because they are not authorized to speak with the media.
Meituan, the largest food delivery platform in China, is among a slew of Chinese tech giants expanding overseas, following in the footsteps of companies ranging from mobile phone maker Huawei to apps like TikTok. The company, founded in 2010, has 500 million annual active users in mainland China. Itlaunched Keeta in Hong Kong in May 2023 as its first venture outside the mainland market.
“Due to the stress in the local economy, many Chinese companies are starting to realize that it is promising to replicate their successful business model in China to other places. Meituan is one of them,” Mandy Hu, director of the Centre for Consumer Insights at the Chinese University of Hong Kong, told Rest of World. In a move that underlines the importance of its overseas business, Meituan’s CEO, Wang Xing, moved Keeta directly under his helm in a company restructuring in early 2024.
The Middle East and North Africa region appears to be where the company sees high potential. Keeta’s CEO, Tony Qiu, said in a February 2024 interview with regional financial news portal Argaam that he expects the Saudi food delivery market to grow 20% year on year. The company has a three-year plan to get a foothold in other Gulf nations — the United Arab Emirates, Qatar, Kuwait, Oman, and Bahrain — according to a report by Chinese media LatePost this month.
Metiuan’s most recent earnings report noted that Keeta’s entry in Saudi Arabia was an “important step” for the company’s international expansion. The company aims to provide service to “more business and consumers globally,” the report said. Keeta has already launched a small-scale drone delivery service in the UAE in December and is hiring more staff to be based in Dubai, according to statements on Meituan’s website.
The Keeta staff member told Rest of World they had no further knowledge of those plans, but said that Egypt is another location under consideration. Keeta did not respond to Rest of World’s queries on its market share and strategy in the Middle East, and its plans for wider overseas expansion.
We cannot really compete. … They are very disruptive to the market.
Keeta’s path to gain market share quickly appears to follow a playbook that it tested out in Hong Kong.
A year after its entry in Hong Kong, Keeta had toppled the original duopoly of Foodpanda and Deliveroo by leading in order volume by May 2024. By January this year, that market share had grown to 55.2%, according to data provided to Rest of World by Measurable AI, a consumer data company.
An employee at one of Keeta’s Hong Kong rivals told Rest of World his company has been under great pressure since Keeta’s entry.
“We cannot really compete. … They are very disruptive to the market,” said the staff member, who asked to remain anonymous as he is not authorized to speak with the media.
In Saudi Arabia, Keeta said it plans to invest 1 billion riyals ($267 million). To lure new customers, Keeta is offering vouchers worth 100 Saudi riyals ($26.65) at sign-up, 50% off first orders, and has waived delivery fees — which Redseer said could take off one-fifth of the usual price of a meal.
This playbook seems to be yielding results for Keeta. It currently ranks number one in free-app downloads on Apple’s App Store in Saudi Arabia, with a total of 3.6 million downloads from October to January, according to data provided to Rest of World from market intelligence firm Sensor Tower.
Keeta has launched special Ramadan deals as part of its localization strategy.
HungerStation and Jahez did not respond to Rest of World’s questions on how they have been affected by Keeta’s entry. Keeta has fueled aggressive promotional campaigns from the two market leaders to retain users, such as heavily discounted subscription programs, according to Redseer.
But Keeta’s price-slashing growth strategy cannot be sustained in the long run, or remain competitive enough to take on international food delivery giants, analysts said.
“Although we think Keeta’s current business model is largely replicable, local government and policy can be challenging to deal with,” Hu told Rest of World. “And like any consumer-based business, you want to be customized to local culture and taste.”
While the food delivery market in the Middle East and North Africa is highly sought after by international players, not every platform is able to survive. The region is the second-biggest market after Asia for Germany’s Delivery Hero — whose business includes HungerStation and Talabat — ahead of Europe and the U.S. Yet, Uber Eats exited the Saudi and Egyptian markets in 2020, after taking a hard look at its “business metrics of delivery services in the competitive market,” according to a report in Arab News.
Keeta will face challenges when scaling up, including to its profitability as it continues to expand internationally beyond the Middle East and North Africa, according to Geng Sun, an assistant professor who researches food delivery platforms at the University of Texas Rio Grande Valley. A key to the company’s success could be its ability to excel in technology to make up for its lack of local expertise, he told Rest of World.
“Keeta’s potential to rival companies like Uber Eats and DoorDash is significant but not guaranteed,” Sun said. “In North America and Europe, entrenched competitors and regulatory hurdles may limit its reach unless it pivots beyond subsidies to tech-driven differentiation like drones and quicker deliveries.”
Meanwhile, Meituan is fighting battles on multiple fronts domestically. It faces pressure from the Chinese market regulator, which extended a three-year antitrust monitoring period for the platform for its alleged monopolistic practices. Its overseas expansion also comes at a time when more competitors — including Chinese e-commerce platform JD.com and TikTok’s Chinese equivalent, Douyin — have entered the domestic food delivery services market.
Amid these challenges, Keeta’s staff member in Riyadh said the company is aware that its growth-before-profit approach cannot be a long-term global strategy.
“It is impossible to offer the same discount endlessly,” they said.