How a Chinese brand reshaped Hong Kong's food delivery scene

NZ Herald

3 days ago

With China's domestic economy slowing and its consumers more frugal, Chinese brands are seeking new business overseas.
And some, like Meituan, are using Hong Kong as a trial market to test the waters.
A former British colony that has long been a gateway between China and the world, Hong Kong has in recent years become increasingly aligned with China politically and economically.
But the city, formally a special zone of China, retains much of its international culture and customs, making it an attractive test bed for Chinese companies.
'Hong Kong is part of the global market with global investors and internationally compliant regulations,' said Jin Lu, a strategic communications consultant at PRConnect (HK) who has worked with many brands in China, including PepsiCo and McKinsey.
In June, iFlytek, a Chinese information technology company, entered Hong Kong.
Its chair, Liu Qingfeng, said iFlytek saw the city as a 'bridgehead' to going overseas, citing its international business services and multilingual population.
Another brand testing the waters is Shoo Loong Kan Hot Pot, one of China's largest hot pot franchises, which has opened a branch in Hong Kong. Its manager described the city as 'the best window for a company's brand exposure' in the world.
For Meituan, Hong Kong was the 'first step in international exploration', the company's founder, Wang Xing, said in 2023.
It initially offered its services to restaurants in what it considered pilot zones: the commercial hub of Mong Kok and the residential area of Tai Kok Tsui.
A year later, Keeta tried its model in Saudi Arabia, choosing the central city of Al Kharj for its launch.
It later entered Riyadh, the capital, where there is fierce competition in food delivery. Within four months, Keeta became a top-three platform in Saudi Arabia.
'We approach global expansion with a measured pace,' Wang said last year. 'We will stay patient and continue exploring while maintaining financial discipline.'
Meituan said in May that it would spend US$1 billion to set up operations in Brazil.
But to its critics, Keeta has been anything but patient in Hong Kong.
In only two years, it has reshaped the city's food delivery business, driving out Deliveroo, once the main player in Hong Kong, with aggressive tactics like slashing delivery costs.
Delivery workers say they were lured to work for Keeta with financial incentives, only to see their pay reduced.
Workers for Keeta, a food delivery app, in Hong Kong. With China's consumers being more frugal, brands from the mainland are seeking new business overseas. Photo / Billy H.C. Kwok, the New York Times
For example, Wong said she had started out earning as much as US$4.20 for each order, including a small bonus for deliveries she made on time.
Now, she said, she makes an average of US$2.60 an order and is expected to work faster or risk her bonus.
'The competition became so intense all of a sudden that it completely disrupted the market,' said Lu, the consultant at PRConnect (HK).
In China, the fierce competition is the norm, especially among delivery businesses.
Consumers expect an on-demand, low-cost service.
When Keeta arrived in Hong Kong in 2023, it offered new users nearly US$40 in discounts and fee waivers, followed by sustained promotions like free delivery during certain times of day or half-price meals.
The subsidies worked.
Keeta had a little over a quarter of the overall food delivery market share in early 2024.
By the end of the year, it had climbed to nearly half, according to Measurable AI, a consumer data company.
Over the same period, the market share of Keeta's competitors Foodpanda, a Singaporean company, and Deliveroo dropped.
Deliveroo, a British multinational, quit Hong Kong in April. It had operated in the city for nine years and once held a 60% market share.
In May, hundreds of Keeta delivery workers went on strike seeking better pay and conditions.
The bonuses and other financial incentives Keeta initially offered workers shrank while the speed demands and other pressures intensified, according to Justine Lam, a specialist at the Delivery Workers' Rights Concern Group.
Keeta narrowed the windows in which it expected workers to make deliveries. Some took risks and ran red lights, according to Lam.
Protesting workers have demanded a minimum base pay of US$6.50 per order and formal employment contracts. Keeta said that income was 'multifaceted' and that base pay didn't reflect actual earnings, emphasising its commitment to 'flexible work opportunities'.
A Keeta spokesperson said the company 'always prioritises the safety of its couriers, striving to optimise their delivery experience and safeguard their income'.
For their part, some restaurant owners complained about the commissions they paid to Keeta. But they also said they got large volumes of orders by using Keeta.
Dee ChaimongAran, 36, said Keeta helped bring as much as one-third of the business to his Thai takeaway eatery, Friends Restaurant. However, its 28% commission squeezed his profits.
'It brought in many orders, so it's hard for us to dislike Keeta,' he said.
Mandy Hu, director of the Centre for Consumer Insights at the Chinese University of Hong Kong, said Keeta's success could lead to a 'winner takes all' situation that hurts restaurants, consumers, and workers.
With Deliveroo out, Hong Kong's food delivery market is now shared about equally by Keeta and Foodpanda.
Hu said the Hong Kong government should supervise and regulate the sector more methodically.
Keeta's sudden growth has also tapped the resentment that many Hong Kongers feel toward China, whose leaders have taken a heavier hand in the city's governance.
The day that Deliveroo announced it would exit the market, people lit up local social media platforms with their anger at what they saw as another example of China's growing influence.
Still, for some workers, such as Xie Long, a master's student from the southwestern Chinese city Chongqing, Keeta is a good way to make a living.
Xie, 26, said Keeta offered him flexible part-time work that helped cover Hong Kong's high living costs. He said he earned about US$250 a month, which covered about half his expenses.
'The income is not very stable,' said Xie, who is studying engineering and struggling to find internships.
But he added: 'I'm not afraid of hard work. As long as I can earn money, I'm okay with it.'
This article originally appeared in The New York Times.
Written by: Zixu Wang
Photographs by: Billy H.C. Kwok
©2025 THE NEW YORK TIMES