China Food

Community group purchase “second half”

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“you need to analyze and observe from multiple perspectives to have an accurate and relevant understanding of the present, so as to better prepare for the future.”
 
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Wen: Lu Fan

Source: RQ business observation room (id:rqmarketing)

 
Sudden “training” of community group buying
Over the past two months, “community group purchase” has been one of the hottest social words. However, before that, this form had already existed, and there was no excessive behavior of residents’ autonomy. Instead, it was dominated by Internet companies and existed in a market-oriented competition mode.
Let’s take the time back to the beginning of March this year, when the community group buying field was entering a “darkest hour”.
First, the Shihui group, one of the earliest entrants, closed its business in all cities across the country; Jingxi in the group purchase sector of JD community lost nearly 10.6 billion yuan last year, making it the hardest hit area for JD layoffs in 2022; Meituan preferred and Alibaba taocai are also accelerating the contraction and layoffs. Problems such as the overweight of market supervision and inadequate financing have made the enterprises of community group buying almost go to the “freezing point”.
Community group purchase due to epidemic outbreak in 2020
The first wave of epidemic in 2020 once gave community group buying an opportunity to grow. However, the new round of epidemic control in 2022 seemed to give community group buying players who were once embarrassed a short respite. With the rebound of the epidemic, the fate of community group buying was renewed, and a sudden “training” was completed in more than two months; In essence, community group buying is still a retail form. After control, community group buying will move towards a new situation with the return of the whole retail e-commerce.
Then, can community group buying continue to grow? Can it lead the community retail to complete the digital transformation? What products will people buy through community group buying?
Through this content, we try to find the development track of the “second half” of community commerce from a more dimensional perspective.
“Four forces” influencing the fate of community group buying
Here, we have found the four most important forces in the development of community group buying: leaders, retailers, platform providers and property companies. The relationship between them may greatly affect the development of community group buying in the future.
1. head
With demand, resources and time
After two months’ verification, we all know that there is a threshold to be a “good regimental commander”, and Ta needs to meet at least the following three conditions: demand, resources and time.
Residents’ demand is the premise. For the daily material needs of residents, the head of the group needs to find the source of goods, purchase channels, negotiate prices, and even communicate and negotiate with the property management. The head of the group who took on the important task of “ensuring the circulation of the last 50 meters of commodities supplied” once became one of the most important roles in this temporary link.
The head with resources will get started faster. In particular, those who have had the experience of head of the team before, have the resources of the supply company in their hands, so they can naturally get the affordable goods resources at the first time. In addition, during the epidemic period, there were special “group leaders” to share information and meet the needs of residents.
Photo source: everyone is a product manager
After life returns to daily life, the test of whether the regimental commander can persist is “whether there is time”. According to the white paper of the head of Shanghai released by Shanghai wow during the epidemic period, 89.1% of the people who acted as the head of Shanghai had their own work. How many of the leaders are willing to continue to spend time supporting community group buying after they are put into their own work?
In this way, the epidemic has spawned more individuals to participate in the work of the head of the regiment and maintain the stability of materials in the community; As for the “professional leaders”, they have gained more resources from both supply and demand sides in the epidemic, with more fixed users, and also opened the gap at the supply side, forming a more efficient and solid group purchase mode.
Therefore, returning to the community group buying mode of normal operation, professional and professional leaders will have more opportunities to gain market recognition and strive for greater voice for the community group buying industry chain.
2. retailers
Community stores and community group buying work together to create a new community retail
Previously, there was a competitive relationship between community group buying and community retail to some extent. However, this epidemic has made the two retail formats of community group buying and community stores more integrated.
Under the epidemic, community retail stores, including community supermarkets, convenience stores and vegetable markets, closed down, and normal retail channels suddenly failed. However, many community stores soon assumed the role of “supply guarantee channel” and “group purchase channel” and continued to serve the community in another way.
Community group buying coexists with other retail channels to find its own position
Source: Nielsen
At the same time, community stores also indirectly assume the important task of “head”, and the “head” endorsed by “retail stores” also reassures platform providers, product providers and consumers.
Of course, retailers should also think about how to use community group buying to give consumers more reasons to bring back online and offline. The “group purchase” business can bring retailers closer to the original consumers and make it easier to know their demands, so as to improve the ability of “selecting goods”.
From this point of view, the combination of community group purchase and retail is also a breakthrough in “people, goods and market”, and has become a new retail scene facing the community.
3. Taiwanese businessmen
Moving towards refined operation
During the epidemic control in Shanghai, community group buying mostly appeared in the form of “guaranteed supply”. Most of the eyes of the society focused on the leaders and brand makers, while the platform makers who started with this business were slightly dim, but we can still see the performance of some leading players during this period.
Pinduoduo, the most representative of pinduoduo, has achieved varying degrees of performance in its two products, “buy more vegetables” and “kuatuantuan”, especially the latter, which has become the most frequently used tool during the epidemic. As a result, pinduoduo’s ambition of group buying in the community has gradually emerged.

Picture of the utilization rate of kuatuan Tuan source: official account @shanghai WOW
Another thing worth recommending is meituan. With its own group buying gene, it is natural for it to enter the army of community group buying. At present, meituan is positioned as a “first-class strategic” project within meituan. Now, meituan has built a direct collection base of fresh aquatic products, built an aerobic transportation system and other measures to strengthen the infrastructure layout of community group buying, which is also a manifestation of consolidating its own local life service moat.
At present, platform providers are gradually realizing the refined operation of community group purchase. Compared with retailers, community group buying platforms can make better use of technology, data, capital and other advantages to empower traditional industries, optimize the supply chain and serve users well, so as to deepen the future and long-term development of community group buying.
4. property management company
The most neglected community group buying power
Can the property company participate in the community group purchase link? In fact, in this round of epidemic, there are many cases where property management personnel participated in the last link of community group buying. The role of the property company originally has natural advantages in community group purchase. The premise is that the essential service work of the property company can be done in place, coupled with the auxiliary services of community group purchase, it can be recognized by residents and won public praise in the market.
The owner believes that the online community group purchase of the property has played the greatest value during the epidemic period
Source: Kerui
In fact, some property owners who rely on real estate companies have begun to take action by taking advantage of the resources within the group. In the past few years, Evergrande, Vanke, poly, R & F, Greenland, country garden and other leading real estate enterprises have entered the community group purchase market, but their overall performance is not satisfactory.
But in fact, Wuguan’s involvement in community group buying still has great advantages. Huang Yu, executive vice president of China Index Research Institute, once pointed out four of these advantages: the property management company can act as an agent for the head of the company, can sell and purchase, can realize store + self collection, and can realize group purchase carrier.
Photo source: Xinhua News Agency
More importantly, the property management company also has more accurate customer portraits and deeper community public resources than retailers, and can realize short-term warehousing and employee distribution through the supply chain. In this round of epidemic, can the property management make use of the particularity of community group purchase to create additional services for the community. This may be an opportunity for property owners and real estate enterprises to tap new profit growth.
However, there are too many problems of property contradictions among residents in this epidemic. What is reflected behind this epidemic is the backward basic service ability and management ability of the property owner. Therefore, if the property owner wants to participate in the community group purchase in the future, it first needs to complete the systematic upgrading of service and management capacity, which is even more urgent.
5. four forces, each responsible
 
It is worth mentioning that at present, the relationship between the head of the group, retailers, platform providers and property companies in community group buying is still in an unbalanced stage. The “head” pays too much attention, platform providers are questioned too much, and retailers and property companies are too low-key.
Imagine if each family can cooperate with each other while performing its own duties:
Platform providers realize resource integration and distribution through technological advantages, accelerate development efficiency and service experience level, and extend the scene of community retail; Retailers and property management companies share the role of “head” to standardize the quality of the whole “head” team and get through the last kilometer.
If all parties actively participate in more and take more responsibility, perhaps this “new retail” model close to the community scene will develop more balanced.
The voice of the market
Consumers’ real demand for community group purchase
Of course, all the prerequisites for the topic of “the development of community group buying” are ultimately inseparable from the demand side – whether consumers still need community group buying. After the return of all retail e-commerce channels, will there still be community group buying among consumers’ purchase channel preferences? What kind of goods do they want to buy through community group buying?
After discussing with a number of industry practitioners and consumers, we found that the demand for community group buying mainly revolves around the age of consumers and product categories.
First, in terms of the age structure of consumers, the middle-aged and the elderly are considered to be the most important target group of community group buying. The wechat group of community group purchase virtually deepens the neighborhood relationship between them; Compared with young people, the elderly have more time, more opportunities and willingness to invest in community group buying and daily group chat. Similarly, these people are more likely to become “long-term leaders”.
Secondly, in terms of product categories, goods with scarcity and absolute price advantage are easier to ship through the group purchase platform. In the final analysis, the commodities purchased by community groups must be differentiated from those through regular retail / e-commerce channels, and people need to have reasons to buy both in category and price.
Of course, the “head” who has won the trust of residents is also one of the reasons for the continuation of community group buying. Here we go back to whether the four forces mentioned above can form a new relationship of mutual balance, so as to achieve a more stable “second half” of community group buying.
Summary
Community group purchase in “ideal”
Due to the epidemic situation in Shanghai, the value and performance of “group leader” to “community group purchase” have been magnified too much, which is also mixed with some irrational emotional catharsis. It should be emphasized that what happened in the past two months will affect the development of community group buying to some extent, but it will not change its overall pattern.
To really see the whole picture of community group buying, we should not only lengthen the time and open the whole industrial chain, but also avoid falling into some kind of timely Carnival and the temptation of traffic trap.
At present, community group buying has gone through a brutal growth period, and it will go more steadily in the second half than before. For brands and product suppliers, if they think that community group buying will become a normal distribution channel, they need to master the characteristics of all products, properly arrange the product channel, understand the relationship and rights and interests of various forces in the community group buying link, so as to better complete the distribution of goods.
Finally, we believe that the ideal community group purchase should be part of the infrastructure leading to a better urban life, opening a window for the construction of new retail scenes in the community; It will use digital technology to promote agricultural products into the community table, enable the transformation and upgrading of industries through platform operation, give full play to the benefits of “four forces” and share the results of opening up the industrial chain.
This article is authorized to be reproduced from the “RQ business observation room” (id:rqmarketing). RQ focuses on “urban business development” and is committed to disseminating urban renewal, business innovation, urban lifestyle and other issues. We hope to connect with thousands of real business people and explore the business world with temperature.
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