Scan the QR code in the image to register
Community group buying is fiercely competitive, and the successive entry of Meituan, Pinduoduo, and Didi has pushed attention to community group buying to new heights.
At the same time, we also see many brand owners and distributors beginning to cooperate with community group buying platforms, exploring more possibilities for market growth and opportunities to reach consumers. Correctly understanding community group buying and the value behind its business model is the foundation for brand owners to properly treat community group buying, explore more market increments, and obtain more business opportunities.
Recently, New Distribution officially released the full version of the "2020-2021 FMCG Community Group Buying Industry Research Report" (hereinafter referred to as the full version of the "Report"). This "Report" took five months to complete. New Distribution conducted a systematic survey of more than 30 community group buying platforms nationwide, 69 brand owners covering 16 major product categories, 107 distributors, 1,161 small stores in 168 cities, and 118 group leaders across the country, and compiled a 121-page industry report. This is another important industry report released by New Distribution in the community group buying field, following the "2020-2021 FMCG Community Group Buying Platform Research Report".
Full Version of the "FMCG Community Group Buying Industry Research Report" Released
The "Report" conducts in-depth investigation and research on all roles in the community group buying value chain, showcasing the competition and collaboration of various players from different dimensions, revealing the market competition landscape of community group buying platforms, analyzing the cooperation trends between brand owners and distributors with community group buying platforms, gaining insights into the key behaviors of various types of group leaders in conducting community group buying business, and summarizing consumer purchasing behavior and decision-making paths, thereby helping community group buying participants grasp industry trends objectively, comprehensively, and deeply, and discover growth opportunities.
In-depth Analysis of the Community Group Buying Industry
The full version of the "Report" is mainly divided into three major sections: an overview of the community group buying industry, a survey of key roles in the community group buying transaction chain, a summary of the survey, and an outlook for the community group buying industry.
First, New Distribution reorganized the definition of community group buying. Community group buying is a business model based on offline fixed physical spaces (communities or business districts), with social relationships as a bond, where community group buying platforms or group leaders (mostly grocery store owners or stay-at-home mothers) initiate group purchases, the platform delivers goods to the group leader, and consumers pick up goods at the door or the group leader delivers to home. It has the following characteristics: community-based, social relationship-bonded, direct supply of goods, procurement based on sales, fulfillment mainly relying on next-day delivery, and goods mostly focused on family life scenarios, with fresh vegetables, fruits, and other categories accounting for a relatively high proportion.
In terms of the composition of roles in the transaction chain, community group buying includes manufacturers (suppliers), community group buying platforms, group leaders, and consumers as the four main transaction links.
The transaction process of community group buying is that the community group buying platform initiates group buying activities, and the group leader completes product sharing to facilitate orders, or the platform displays product activities through the APP and consumers directly place orders. After receiving order information, the community group buying platform ships the goods to the group leader (in the one-piece drop-shipping model, suppliers will mail goods directly to consumers via express delivery), and consumers pick up goods at the door.
To help everyone better understand the business model of community group buying, New Distribution systematically sorted and compared community group buying with current mainstream community retail and e-commerce forms from dimensions such as transaction characteristics, service objects, purchase purposes, transaction goods, product ownership, and main fulfillment methods.
On the warehousing and distribution side, the logistics fulfillment system of community group buying includes processing warehouses/shared warehouses (cloud warehouses), central warehouses (RDC), grid warehouses/service stations, stores/group leaders, and finally consumers picking up goods at the door. Different warehousing links have different roles and functions.
Based on the main sources of orders for community group buying platforms, New Distribution divides community group buying platforms into community traffic-based platforms and platform traffic-based platforms. Community traffic-based platforms rely more on group leaders for order conversion, while platform traffic-based platforms, because the platform itself has huge traffic, rely less on group leaders in the order conversion process and more on the platform's own traffic.
Based on the overall industry development and the 2020 GMV achievements of several major head platforms such as Xingsheng Youxuan, Meituan Youxuan, Duoduo Maicai, Chengxin Youxuan, Shihui Tuan, and Tongcheng Life, we can determine that the overall market size of community group buying in 2020 has reached 140 billion yuan, and in the next 3-5 years, the overall market size of community group buying will reach 1.19-1.49 trillion yuan.
On the consumer level, the main consumer group of community group buying is married women aged 25-49, mainly in third-tier and below cities, but the proportion of consumers under 29 years old has shown a significant upward trend.
On the platform level, based on platform scale, industry influence, and future development expectations, New Distribution divides community group buying platforms into four echelons. The first echelon platforms are Xingsheng Youxuan, Meituan Youxuan, and Duoduo Maicai; the second echelon platforms are Chengxin Youxuan, Shihui Tuan, and Tongcheng Life; the third echelon includes Shixianghui, Xiaoxiong Leyoutuan, Diaodaojia, Dili Market, and Jiayi Youxuan; the fourth echelon platforms are regional platforms such as Zhihuazhiguo, Tudigong, Lele Fresh, Youjingyoutian, Jiubai Street, Jiayijia, Keke Jingxuan, and Shixiang Tianxia.
On the brand owner level, more than 80% of brand owners have cooperated with community group buying platforms, while 19.2% of brand owners have not cooperated with community group buying platforms. The main reasons for not cooperating are lack of clear organizational structure and manpower/energy, not yet finding suitable strategies and precautions, and not having suitable products for sale in the community group buying channel.
Among brand owners that have established cooperative relationships with community group buying platforms, more than 60% of brand owners choose to cooperate with more than 4 community platforms, and in platform selection, they mainly focus on Xingsheng Youxuan, Chengxin Youxuan, Duoduo Maicai, Meituan Youxuan, and Shihui Tuan, which are also the key community group buying platforms for brand owners.
On the distributor level, 75% of distributors have a clear understanding of community group buying, and 53.9% of distributors have already cooperated with community group buying. It is worth noting that among distributors who have cooperated with platforms, 52.4% established cooperation within the past year. The main reasons why distributors have not cooperated with community group buying platforms are brand owner policy prohibitions, lack of organizational structure and manpower/energy, and lack of suitable products for sale in the community group buying channel.
As the most important link in community group buying, the importance of group leaders is self-evident. In third-tier and below cities, women aged 40-49 have become the main group of group leaders. It is worth noting that after a year of rapid industry expansion, community group buying group leaders are showing a trend of aging, and in market distribution, they are gradually extending to higher-tier markets.
By integrating with community group buying business, small stores have effectively expanded their user base, expanded their product categories, increased consumer store visit rates, and through online channel sales expansion and category optimization, increased overall sales and store operating profits.
*The above is part of the full version of the report. For more details, please refer to the full version of the report.
Reader benefits: Reply with the following keywords in the WeChat official account backend to receive the free preview version or report outline of the corresponding report.