ChinaTravelNews, Ritesh Gupta – Meituan is triggering a shift in the travel and hospitality segment, pivoting from unsustainable price wars toward a high-tech, service-led ecosystem.
While the company reported a full-year loss of RMB 23.4 billion for 2025, this calculated loss reflects heavy investment in what CEO Xing Wang describes as an “AI Super Gateway”, an entry point that replaces traditional keyword search with an AI agent capable of planning and executing complex real-world tasks.
During the earnings call, Wang emphasised this proactive shift, stating: “In this AI revolution, the only meaningful strategy is to take the initiative rather than merely adopting a defensive posture.” This vision is backed by CFO Shaohui Chen, who noted that the company is intentionally “reallocating resources away from low-value, low-quality orders” to prioritise high-margin sectors like travel and hotels.
From search to concierge
This evolution transforms Meituan from a simple search directory into an AI-powered concierge, with the company’s in-house LongCat LLM changing the hotel booking journey. Instead of typing “5-star hotel Pudong,” users now provide complex, natural language requests like, “Find a quiet hotel near the Bund with a gym and late check-out for a business trip.” This shift marks the decline of the traditional search bar as the AI assistant, Xiaotuan, moves beyond simple “chatting” to connect with a massive, proprietary database of real-time merchant capacity, traffic data, and location mapping.
The competitive edge is evident in complex scenarios: imagine a user needing to coordinate a lunch meeting between two distant city districts within a strict two-hour window; Meituan’s AI synthesises real-time traffic, restaurant availability, and specific amenities to offer a single, executable solution. This level of “physical world” integration allows Meituan to solve complex travel logistics that standalone OTAs often face friction.
Supporting this is a unified loyalty program that merges previously fragmented services into a single “all-category” membership. In simple terms, this means every high-frequency action, say from ordering a coffee to booking a bike share, contributes to a single membership tier, creating a powerful cross-selling engine for hotel partners.
It’s worth following how Meituan is flipping the script on traveller acquisition, converting daily-need power users into high-value hotel guests through their unique cross-selling engine. Consequently, the 2025 results suggest that SEO is evolving into AIO (AI Optimisation). As Xiaotuan becomes the primary way users interact with the app, a hotel’s success will depend on how well the AI “understands” its digital profile. Travel providers who use Meituan's AI tools to clearly digitise their unique selling points such as “business-friendly quiet” or “instant check-in” will be the ones the “Super Gateway” recommends first.
Quality over quantity
Meituan’s fiscal year 2025 financial results reflect a deliberate transition from raw volume to “quality growth,” underpinned by a resilient core local commerce segment. Total revenue grew 8.1% to RMB 364.9 billion, driven by a core user base that has reached record highs in transaction frequency and ARPU (average revenue per user). This engagement is not accidental; it is the direct result of the membership upgrade which has effectively moved mid-tier users into higher, more profitable loyalty brackets. By reducing “irrational subsidies” and pulling back from low-quality, low-AOV (average order value) orders, Meituan has attempted to defend its market leadership while improving the unit economics of its food delivery and instant shopping arms.
The travel and hotel sectors are the primary beneficiaries of this structural shift.
Unlike food delivery, travel and hotel bookings are high-consideration, non-impulsive purchases. Historically, capturing these users required expensive, intent-based marketing. However, Meituan’s unified loyalty ecosystem turns daily “low-intent” habits into a persistent “top-of-mind” advantage. High-frequency users who interact with the app 20 or 30 times a month are systematically cross-sold travel services through exclusive member benefits. This creates a “warm lead” environment where a user who trusts the platform for their daily essentials is more likely to trust it for a weekend getaway. The “Hotel+X” strategy is further bolstered by the growth in AOV among high-value members, allowing the AI to predict travel needs with surgical precision and reduce the friction of the booking process.
Takeaway: from intent to habit
Meituan is fundamentally shifting the travel paradigm from intent-based search to ecosystem-driven habit. By integrating physical world data such as real-time traffic and merchant capacity into the Xiaotuan AI agent, Meituan is building a seamless concierge experience, a differentiating factor from OTAs. For hoteliers, the value proposition is a departure from “irrational” search-ad spending; instead, they gain direct access to high-tier loyalists, identified through daily behaviors and delivered via an AI-led ecosystem that prioritises logic, service, and lower acquisition costs.
