Recently, Meituan announced the acquisition of Dingdong for $717 million, a capital move that undoubtedly signals to the market that instant retail, as one of the high-efficiency new retail formats, is very valuable. The reason it's valuable is not only its explosive growth in recent years, but more importantly, instant retail has restructured certain original retail chains, greatly improving efficiency. Efficiency is an undeniable moat in the retail industry. However, this rapid change in efficiency is not easy for brands to adapt to. Essentially, there are significant challenges from understanding to cognition to execution. Misunderstanding: Instant retail is essentially an offline business First, many brands have a huge deviation in their judgment of the business when understanding instant retail. The instant retail business itself is deceptive, leading many brands to mistakenly think it's an online business model. Although consumer purchase behavior occurs online, and platforms require spending money on subsidies, buying traffic, and competing for rankings, and even the price comparison for instant retail is mainly with online platforms. But whether it's a visible store (store-warehouse integration) or a dark store (front warehouse), there is a physical radius for fulfillment services, basically covering 3-5 kilometers, which means instant retail itself is a limited-distance retail supply. Limited-distance supply means that instant retail mainly affects surrounding consumers, i.e., it participates in the restructuring of surrounding consumer traffic. For example, a consumer's past purchase behavior was 20% online and 80% offline. The 80% might consist of 20% CVS, 30% KA, and 30% mom-and-pop stores. But with instant retail, this ratio is restructured to 10% CVS, 30% KA, 20% mom-and-pop stores, and 20% instant retail. This restructuring of regional consumer traffic structure means that instant retail is essentially an offline business, mostly grabbing offline business traffic. But from an operational model perspective, instant retail is completely different from traditional offline business. To do well, relying solely on previous visits, distribution, and stacking displays is no longer useful; more importantly, like online, it needs to be operated with a traffic mindset. Cognitive Misunderstanding: Instant retail diverts sales But it's hard to build brand momentum Since it's an offline business, it follows the rules of offline business, and brands have different definitions and requirements for different channels. Because channel attributes are different, whether it's building brand momentum, contributing profits, or contributing sales, the functions borne by various channels are not consistent for brands. Instant retail is no exception; it's important for brands to clearly understand what the channel attributes are. To understand channel attributes, one needs to know which traditional channels the stock traffic that instant retail mainly divides comes from. There's a common misconception that instant retail needs to be operated with online traffic thinking, so many naturally understand this channel as the same as online, both incremental and capable of amplifying brand value. But from channel characteristics, instant retail has long business hours, and 30-minute delivery is convenient, consumers buy based on purposeful search, leading to its impact on offline formats like CVS (scarce supply at night but expensive), mom-and-pop stores (visible everywhere for convenient purchases), and KA (purposeful stock-up purchases). From consumer purchase habits, opening the app and searching for products often contributes the majority of sales. This means that products that sell well in instant retail often have prior consumer awareness, so branded products have an advantage. It is precisely because of this consumer purchase habit that conversely, trying to increase brand momentum through covering instant retail channels may significantly fail. This is why many manufacturers complain that when they allocate resources to instant retail, the effect is immediate, but once they stop, sales shrink immediately. It can be seen that there is a cruel reality: although instant retail is growing rapidly, this growth comes from the diversion of traditional offline channels and does not help much in building brand momentum. It's easy to imagine how tangled brands are with instant retail! Execution Misunderstanding: Channel structure changes Brands need to adapt to new management methods Even if brands understand and recognize the characteristics of the instant retail channel business, at the practical operational level, doing this channel well still faces huge challenges. There are mainly two: first, the price-breaking issue; second, the operational cost issue. Since instant retail greatly shortens the circulation chain and improves efficiency, terminal prices are redefined downward, making cheapness an unavoidable issue in instant retail. Cheap prices mean breaking prices, which is undoubtedly fatal to offline. Therefore, many brands are forced to choose differentiated specification products, or even customized products, to meet the needs of instant retail channels. Naturally, in the short term, this avoids price comparison issues, but implicitly increases the brand company's operational costs. Of course, implicit operational costs are not limited to this. As mentioned earlier, instant retail essentially diverts business from traditional offline channels; if it doesn't shine on one side, it shines on the other. On one hand, traditional war zones still need offline sales to serve and maintain; on the other hand, to do well in instant retail channels, a separate sales team needs to be formed. As a result, sales output doesn't change substantially (or even the response may be slower, and competitors may take away some business), but personnel expansion increases costs and adds management costs. Some instant retail platforms even expand across regions, leading to a series of chain reactions such as cross-region channel stuffing and increased after-sales difficulty. Whenever new retail channels develop and conflict with traditional offline channels in sales, it will invisibly increase brand operators' operational costs. This is an inevitable problem for brands in familiarizing themselves with the rules of new channels, and it is also a key challenge in using new management methods to adapt to new channels. How to calculate the gross profit and cost structure of new channels, how to balance performance division between headquarters and war zones, how to configure sales teams... These are all issues that brands must face to do well in instant retail. Final Thoughts In the past two years, new retail channels have flourished, and instant retail is at the forefront, indeed bringing new increments for brand development. Although this new increment is scarce in a fiercely competitive environment, as a brand, it still needs strategic focus to see whether the new channel ultimately brings healthy growth or false prosperity. Every time a new channel develops rapidly, it's not easy for brands to do well, do thoroughly, and do solidly. Therefore, on March 17, 2026, in Chengdu, we will hold the "CFC Second Instant Retail Supply Summit Forum and Instant Retail Warehouse-Store Product Matchmaking Conference." This session focuses on one thing: selling the right goods into the right warehouses and making them move faster. Key topics and outputs will revolve around the following:
- 100+ TOP warehouse-store distributors share their product selection logic;
- 70+ warehouse-store founders share their procurement logic on-site;
- Latest brand operational instant retail practical cases;
- Warehouse-store matchmaking: brand × warehouse-store × service provider on-site exchange. Make supply more controllable and growth more certain. Friends who care about instant retail channels should not miss it. Interested friends, scan the QR code below for details!