Produced | Dali Finance
Why is community group buying so popular? The trillion-scale market, high-frequency rigid demand, and low online penetration rate have attracted many capital and Internet giants rushing in over the past few years.
With the entry of giants, competition in the community group buying market has become increasingly fierce. It is not only the giants who are chasing the outlet, but also upstream and downstream participants.
In less than 5 months, Orange Heart Optimal Daily Orders exceeded 7 million. On November 10, Didi’s community e-commerce platform Orange Heart Optimal announced the result. At the node of Double Eleven, this transcript is quite interesting. It should be known that the highest order volume in the community e-commerce industry was maintained by Xingsheng Optimal, and the current daily order volume is around 5 million.
Although Orange Heart Optimal started late, it gained momentum. Cheng Wei, the founder of Didi, said that there is no upper limit for investment. From the perspective of development momentum, behind Didi's community e-commerce, it is bound to trigger a "catfish effect."
01
Didi enters the game, is this move right?
This track is not the latest outlet, but has gone through a round of market panning.
According to data from iMedia Research, the domestic community group buying market will develop rapidly in 2020. The market size is expected to reach 72 billion yuan, a year-on-year increase of 112%. It is estimated that the Chinese community group buying market is expected to reach 100 billion yuan in 2022.
For companies, the epidemic is both a crisis and an opportunity. This year's epidemic has accelerated the development of users' group buying habits. For such a big cake, everyone definitely wants to grab a piece.
Long before Didi entered the game, Shihui Group, Tongcheng Life, and Prosperity Optimal have been rooted in this track for many years. After that, Internet giants began to follow up, and Meituan, Pinduoduo, JD, Didi, Ali, etc. poured into this track. The entry of Internet giants is different from that of early players. They prefer to explore long-tail traffic through community e-commerce, just like Meituan’s entry to taxi.
Didi entering the game is different from other players. Most of the other players are related to e-commerce, restaurants, and communities. Didi is deeply involved in the field of travel, which is a layman for the e-commerce industry.
This time the new track is selected in the community e-commerce field. This is not unrelated to Didi's current development.
In the first half of this year, Didi announced its strategic goals for the next three years: to achieve 100 million daily global services within three years; domestic travel penetration rate of 8%; global service user MAU exceeds 800 million. This strategy is called "0188" plan.
In China, Didi is already a well-deserved leading platform, and it urgently needs to find new areas beyond travel. It’s better to walk on two legs than to be steady on one leg. Everyone understands the principle of wooden barrels. Didi, holding a lot of cash flow, is looking for the track.
It is reported that Didi's taxi-hailing business has basically achieved profitability, with sufficient cash on books, and has reached the key point of shifting from defense to offense. As a result, Didi has successively launched new businesses such as running errands, freight, and community group buying. In terms of its original business, Didi adjusted the structure of its financial division and taxi division, upgraded its taxi business to "Quick New Rental", completed US$500 million financing for autonomous driving companies, and renamed Didi Carpool to "Qingcai" "Carpooling", launching a new brand of Huaxiaozhu Taxi in the low-tier market... The community group buying business "Orange Heart Selection" is also one of its new businesses.
According to insiders, the Orange Heart Optimization will be an important part of Didi's "0188" strategy.
Community group buying is known as a trillion-dollar market, and it is just emerging, especially after an epidemic. The advantages of community group buying have been highlighted. When the market lacks a leading platform, it is also the best time to enter the game. Naturally, Didi does not want to miss it.
02
Community e-commerce wars are on the horizon, and there is a trend of a hundred groups war
However, community e-commerce is definitely not easy to go, and it is possible to reproduce the scene of the Hundred Regiment Battle.
As early as a few months ago, Meituan designated community group purchases as a first-level strategic project, trying to create a new growth curve in addition to the two main businesses of catering and delivery, in-store and liquor travel. It is reported that Meituan is also fully supporting the community group buying business within the company, "request money for money, ask people for people", and put Pinduoduo's "Buy Duoduo" as its biggest rival. At the financial report meeting in the second quarter of this year, Wang Xing also stated that Meituan will invest sufficient resources in the field of fresh food retail and is determined to win the market.
Alibaba has mobilized all relevant resources such as Hema, Ele.me, Cainiao, and Retail Link to invest in community group purchases, and established the "Hema Optimal Business Unit", which shows its emphasis on community group purchases.
Pinduoduo also attaches great importance to the community group buying business. It has designated its "Duo Duo Cai" as the only super-level project this year, and invested 1 billion in subsidies to grab the team leader's resources and expand the market.
It is reported that as early as 2014, community e-commerce emerged as the prototype of community group buying, and it has gradually evolved from small local businesses to large platforms.
With the influx of a large amount of hot money, the community group buying market, which has experienced explosive growth, entered a reshuffle period last year. Many players who lacked supply chain capabilities and had broken capital chains were defeated in this thousand regiment battle.
In the second half of this year, the community e-commerce sector once again heated up. "2020 will be the best year for the brutal growth of a large number of community group buying companies." The person in charge of a platform community group has once said.
"What is the community group buying fight for? Quality" is just a low price, but poor quality is troublesome. The neighbors have problems buying things twice, and no one will believe you if you sell anything in the future.
Many people in the industry have said: "Community group buying starts with the leader and ends with the supply chain." This means that if players want to play this deck, they must have leader resources and supply chain advantages. The e-commerce platform has the advantage of the supply chain, but the team leader's resources are lacking. With the advantage of offline stores, Cainiao accidentally obtained the team leader's resources, but the supply chain needs to be opened up.
It can be said that Didi has to re-pave the road in two aspects, but fortunately Cheng Wei has prepared enough ammunition, enough to deploy quickly within a period of time. And another advantage is that Didi has millions of driver resources and can use this part of the resources. A driver radiates a family. If the housewives can be connected, the "Didi dual employees" may become A good breakthrough.
Several giants participating in this year are all having opportunities, and they are all on the starting line. It depends on who can make up for the shortcomings faster.
Throughout the culture and team of Didi, we have obvious advantages. They are good at learning from their opponents through wars, making up for shortcomings in wars, strengthening operations, and strong subsidies. The core team selected by Orange Heart is led by the early core figures of Didi and has the spiritual core of "Iron Army".
In this regard, only Meituan and Pinduoduo can compete with Didi. These three O2O platforms started with similar models, and have gone through hundreds of battles and tempers.
03
The trillion market is to be tapped, leaving little time for small players
Community group buying is still a blue ocean, and its development space is still huge, far from reaching the bottleneck of industry development.
According to incomplete statistics from Tianyan, since this year, China's community group buying and fresh food e-commerce fields have accumulated more than ten rounds of financing, with an amount of up to 10 billion yuan. Among them, Shihui Group received three investments this year, with a total of US$249.7 million in financing; Xingsheng Optimal Group completed a round of financing of up to US$600 million.
Nowadays, as a model innovation of traditional social group group e-commerce in the dimension of "offline community", community group buying seems to have become a growth switch for mainstream fresh consumer groups that are most likely to go deep into communities and streets.
According to insiders, Orange Heart Optimal is accelerating infrastructure construction and is ready to lead the long-term community group buying. At the same time, Orange Optimal Group is constantly strengthening its upstream supply chain and downstream warehousing capacity.
The driver of Didi's service is closest to the portrait of the owner of the convenience store. The nature of online car-hailing is similar to community group buying, and it also revolves around Didi driver, the B-end user. This is a marketing path that "users send online demand, car owners perform offline, the platform provides information services, and standardizes the management of car owner services". Therefore, after switching to community group buying, the driver himself can become the group leader.
Even more terrifying is management. As we all know, community leaders are mostly idle personnel. Didi and Meituan have inherent advantages in the management of these people.
Didi has accumulated rich experience in C-end user operation and B-end channel development in the travel business, especially with the help of big data in transportation and travel, and has a good foundation in the development and efficiency of key distribution systems. Didi has accumulated experience in car owner service management in the past eight years. Didi has a mature organization and management system, which is very effective in the management of the organization and management experience and the empowerment management of the owner/group leader.
"The community group buying market should be occupied by 1-3 top players in the future. Most of the market share." A community e-commerce leader predicted, "As more potential users and consumption of GMV (website transaction value) Tilt, the barriers for the head players will be more perfect."
With the entry of powerful opponents, the time left for small players is running out, and the final result must be that big fish eat small fish. Therefore, small players must take advantage of the ground snake to quickly get capital expansion, and then occupy a place.