Collaborative Scope: Encountering the Substitution Effect within the Delivery Scope in Online Food Delivery Platform

Online food delivery (OFD) services, known for offering varied meals at home, have gained global popularity. Meituan has recently ventured into the affordable market segment with its "Pinhaofan'' service, highlighting the imperative to delivery efficiency. To achieve this, delivery scope is regarded as one of the most effective operational tools. The delivery scope of a merchant refers to the geo-graphical area where they can serve customers. Current methods for generating delivery scopes primarily focus on optimizing a single merchant's efficiency or rely on manual delineated from the merchant's perspective, neglecting the merchant substitution effect and potentially resulting in order loss. In this paper, we propose a novel method, named Collaborative Scope, which views the delivery scope as an assortment optimization problem, considering the substitution effect between merchants from the user's perspective. We introduce the discrete choice model of econometrics and use the Enhanced Multinomial Logit Model to predict user conversion rates in the merchant list. Next, we formulate the delivery scope optimization problem of multiple merchants as a mixed integer programming problem. The city-wide solution of this problem, owing to the large-scale combinatorial optimization triggered by high-dimensional decision variables, incurs high computational complexity. To address this, we propose an approximate solution to the original problem through a first-order Taylor series approximation, which significantly reduces the computation complexity at the expense of a slight decrease in solution accuracy. Offline and online A/B test results indicate that, compared to existing methods, Collaborative Scope significantly improves delivery efficiency by reducing delivery difficulty without hurt of order volume. Notably, Collaborative Scope is currently deployed on "Pinhaofan'', serving tens of millions of online users.