The community group buying track used to be very crowded, and head players such as Duoduo Buy, Meituan Preferred, Taocai Vegetables, and Xingsheng Preferred have occupied their own places. But now, the community group buying market has reached a key node in the industry reshuffle, in this "life and death" situation, where should the community group buying go?
On November 12, 2021, the State Administration for Market Regulation said in its reply to the "Proposal on Preventing Large Internet Companies from Using Online Group Buying to Form Market Monopolies to Enter The Grass-roots Areas of Cities and Counties, Seriously Affecting the Interests of the Masses", saying that the suggestions on "using strict law enforcement and strong supervision to cool down community group buying with disorderly competition" and "defining and scientifically regulating related issues as soon as possible, restricting the expansion of capital with monopolistic tendencies in accordance with the law, and integrating technological advantages with consumer demand and the real economy" are very much in favor.
At this point, policy supervision has become the norm, and the industry market has continued to clear. After barbaric growth, community group buying will shift from barbaric growth to refined management. The arrival of the track replacement and cooling node also means that the community group purchase entrants must return to the essence of retail, that is, to seize the needs of consumers
"Sinking" or the endgame
Although the traffic dividend of the current online platform has peaked, and community group buying has not been able to become the first choice for community consumers in every regional market, it has hit physical retail hard in the past few years and still plays a role in diverting consumer demand. It's just that the entire track is shuffled, allowing the community group buying platform to re-examine itself more rationally.
The strategic layout of the giants has triggered a crazy "inner volume", the development space in the community group buying track in first- and second-tier cities has been squeezed, and because of the intervention of policy supervision, the crazy expansion of capital power has been suppressed, and the sinking market seems to have become a better choice.
According to MSC Consulting's "China Sinking Market Series Report: Consumer Retail", consumption in the sinking market shows far more complex and diversified characteristics than that of first- and second-tier cities.
From a geographical point of view, the sinking market spans the north and south, across the east and west, covering the masses of different regions, climates, cultures and customs; from the perspective of demographic characteristics, compared with the population structure of first- and second-tier cities, mainly middle-aged and young people, the sinking market accounts for a higher proportion of the adolescent and children population and the elderly population.
The sinking market has the characteristics of large population, wide range and geographical dispersion. The sinking market includes both the local population and the returnees, with a total population of nearly 1 billion, accounting for 70% of the country's total population.
The sinking market covers nearly 95% of the mainland's land, including nearly 300 prefecture-level cities, 3,000 county seats, 40,000 townships, and 660,000 villages. 35.5% of the sinking population comes from third-tier cities, 38.6% from fourth-tier cities, and although there are many fifth-tier cities, the size and population of cities are relatively small, and the overall population accounts for 25.9%.
Community group buying has a unique sinking advantage, in other words, it is easier to achieve the popularity of rural markets.
From the attention of consumers in the sinking market to the category, we can glimpse the consumer demand of the sinking market - young consumers in the sinking market hope to catch up with the pace of first- and second-tier cities, obtain a better consumer experience and lifestyle, and pay attention to food, clothing, beauty and personal care and other categories.
The consumption habits of the elderly in the sinking market are more conservative and basically rely on offline channels for shopping, but due to the impact of the epidemic and the popularity of smart phones, more and more elderly people have begun to use more convenient online shopping, focusing on fresh diets and daily necessities.
The consumption demand of the small town population, that is, the consumption demand of "how fast and good to save" and the consumption of large families, can reflect the advantages of centralized procurement. The size of large cities is getting smaller and smaller, the amount of goods purchased by community groups is large, but the processing is not fine enough, which is particularly evident in the fresh category, which is contrary to the quality requirements of urban consumers.
Moreover, the model of "next-day delivery + self-pickup" of community group purchase effectively reduces the cost of performance and improves the efficiency of performance, which is an important condition for "sinking".
At the same time, because the e-commerce platform has boosted the construction of supporting facilities for the overall online retail after the previous burning competition in the sinking market, coupled with the low labor costs and operating costs of the sinking market, it is more conducive to the rapid development of community group buying.
The competition of community group buying in first- and second-tier cities has been settled, and the competition in the sinking market has just begun. The inflection point of the community group buying midfield war has arrived, and the era of intensive farming is about to begin.
The Red Flame Community Group Buying Mini Program System has a perfect supplier management system, which helps the community group buying enterprises to carry out refined operations, so that suppliers can control the quality of goods and achieve performance obligations. At the same time, it can also strengthen the efficiency of performance, so that consumers can receive goods and goods within the agreed time limit.
With the help of the Red Flame Community Group Purchase System, the supplier system can control the quality of goods, reduce product wear and tear, provide better products and services for platform users, and enhance word of mouth.