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Product Management Root Cause Analysis Question: Investigating Meituan's food delivery average order value decline

Why has the average order value for Meituan's food delivery service dropped by 15% in the past month?

Data Analysis Hypothesis Testing Strategic Thinking Food Delivery E-commerce On-demand Services
Food Delivery Root Cause Analysis Competitive Analysis User Behavior Average Order Value

Introduction

The recent 15% drop in average order value for Meituan's food delivery service is a significant concern that requires immediate attention. This analysis will systematically identify, validate, and address the root cause while considering both short-term and long-term implications for the business.

To tackle this issue, I'll follow a structured approach that covers issue identification, hypothesis generation, validation, and solution development. This framework will ensure we thoroughly examine all potential factors contributing to the decline in average order value.

Framework overview

This analysis follows a structured approach covering issue identification, hypothesis generation, validation, and solution development.

Step 1

Clarifying Questions (3 minutes)

  • Looking at the timing, I'm thinking there might be a seasonal effect. Has this drop coincided with any major holidays or events in China?

Why it matters: Seasonal trends can significantly impact consumer behavior and spending patterns. Expected answer: No major holidays or events during this period. Impact on approach: If confirmed, we'll need to look deeper into internal factors or market changes.

  • Considering user segments, I'm curious about the distribution of this decline. Is the 15% drop uniform across all user groups, or are certain segments more affected?

Why it matters: Understanding which user groups are most impacted can help pinpoint the root cause and tailor solutions. Expected answer: The decline is more pronounced among younger users and in tier-1 cities. Impact on approach: This would lead us to investigate factors specifically affecting these demographics.

  • Thinking about recent changes, have there been any significant updates to the app or service offerings in the past month?

Why it matters: Product changes can have unintended consequences on user behavior and spending. Expected answer: A new UI was rolled out for the ordering process two weeks ago. Impact on approach: We'd need to closely examine the impact of this UI change on user behavior and order placement.

  • Considering market dynamics, has there been any notable shift in competitor activity or pricing strategies recently?

Why it matters: Competitive pressures can directly influence consumer spending and loyalty. Expected answer: A major competitor launched an aggressive discount campaign three weeks ago. Impact on approach: We'd need to assess our pricing strategy and value proposition in light of competitive actions.

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