There are a thousand Hamlets in a thousand people's eyes. This saying aptly describes the current rise of community group buying. Some say internet giants are 'unfair' for taking away vegetable vendors' business, putting community group buying in the spotlight. In the past, industry observers viewed community group buying from various angles: some from the perspective of internet giants, some from fresh produce supply chains, some from e-commerce traffic, and so on. But this article takes a different angle, discussing community group buying from the standpoint of people's livelihoods and labor, and has garnered much praise. The negative aspects of community group buying have been highlighted repeatedly. This makes many of us start to think: Does community group buying have value at all? Does it play by the rules?
Regarding whether it has value, everyone has a standard and measure based on their role and position. I believe every practitioner in community group buying has their own views and understanding, and everyone seems to have their own judgment and prediction about it.
The real outcome in the future is unknown. But I firmly believe that judging the value of community group buying based on its current form is definitely not advisable. Group buying is a model, and community is the most widespread geographical format in China. What will future community commerce look like? It will definitely be diverse, segmented, more convenient, higher quality, and better able to meet people's consumption experiences. Therefore, we must not look at community group buying's future based on its current state, nor view it from a single perspective or dimension. In short, we should neither overcorrect nor turn a blind eye to community group buying.
-01- Community Group Buying: The Two Sides of the Coin
Admittedly, new things represented by the internet do impact traditional existing things at their inception, posing challenges to the original business ecosystem and related practitioners. But has commercial change ever been any different? Innovators take away the benefits of incumbents; if they succeed, they become the new beneficiaries. But when the next round of commercial change comes, the next wave of innovators will still replace the previous new beneficiaries. Because of commerce, society has progressed and developed.
At this point, some might say, what about those hardworking vegetable vendors who have achieved prosperity through diligence? Are they incumbents? Yes and no.
E-commerce observer 'Wanneng de Daxiong' once expressed: If the vegetable market disappears and they can't sell fruits, they might sell something else. Don't think they can only sell vegetables or fruits for life. In the past, they did it because it was easy; when it becomes difficult, they will naturally switch to something else.
What have these people done? Let's look at some data: As of November 25, Meituan Select has covered 226 cities nationwide, with third-tier and below cities accounting for 80.5%. In each city where it operates, Meituan Select establishes a logistics distribution system of 'large warehouse - grid warehouse - offline service stores' through self-built and franchise models, recruiting warehouse, logistics, merchant, group leader, ground promotion, and store staff, creating a large number of local employment opportunities.
As one group fades, a new group emerges. In the transition of groups, what changes is the new way of working under the new business ecosystem. Elimination and transformation have always been the replacement of old and new things, and people seek new opportunities in the transition. Some find new jobs, increasing employment and income. Some may find lower income compared to their original individual businesses.
The emergence of community group buying should not be viewed solely from a critical perspective, but rather from the perspective of commercial progress, looking at the present from the future: Has it improved efficiency? Has it created greater value?
-02- Community Group Buying: Forcing Industry Upgrades
We just talked about people's livelihoods. Now let's discuss consumer demand. We've been talking about the stock market, which means meeting consumers' basic material needs. Future business should focus on the incremental market. What is the incremental market? Creating consumer demand, even proactively creating demand, further segmenting demand, and satisfying it differently.
Recently, I visited KKV Life Store. Daily chemical and beauty products were abundant, and young people were coming and going, not just shopping but also taking photos. Wait, wasn't it said that physical beauty stores were severely impacted by e-commerce? Why does KKV Life Store still have so many people?
This is how physical stores save themselves under e-commerce impact. Without e-commerce, you can hardly imagine physical beauty stores adopting such a format to attract young consumers. What KKV Life Store does is create consumer demand, adding experience beyond basic needs, and even becoming a social media hotspot.
Many say community group buying will impact supermarkets by 10%-30%. I believe such an impact will occur. What should supermarkets do after the impact?
There may be two paths: First, faster and more convenient shopping experiences, O2O home delivery within 30 minutes, meeting immediate consumption needs; Second, differentiated product selection, better quality products, and superior in-store shopping experiences. Like KKV Life Store, it's not just a shopping place but also a leisure place.
Can community group buying provide more value in fresh produce in the future, such as standardizing non-standard products, different pricing for different items and specifications, and different products for different needs? Can supermarkets upgrade and innovate around the two dimensions of speed and experience in this round of transformation?
The emergence of community group buying is like a catfish stirring up the offline market, making traditional practitioners who have been complacent realize that commerce is always progressing and innovation cannot stop. They cannot rest on their laurels just because they gained location and scale advantages earlier.
In the past, abundant products, good prices, and good after-sales service were core competitiveness. In the future, it will be quality products, good experiences, and excellent service.
-03- Community Group Buying: Opportunities for New Talent
Any new commercial transformation will give rise to a new batch of jobs. For example, Renmin University released a report stating that Didi has driven over 18 million employment opportunities; Meituan's report shows that in the first half of the year, there were nearly 3 million riders, with 7.7% earning over 10,000 yuan per month; Renmin University also reported that from August 2019 to August 2020, Douyin alone drove 36.17 million employment opportunities.
These are the talent values created by new things. The emergence of community group buying requires a large number of personnel for ground promotion, grid warehouses, and sorting warehouses in various regions.
At the same time, new platforms will also incubate more new supplier groups. Some may be original wholesalers who, through transformation and upgrading, seize the dividends of community group buying development and grow stronger; some may be original regional salespeople who start businesses on the platform and achieve new careers.
There are also batches of original community supermarket owners. In the past, they were just retail store owners selling cigarettes, alcohol, groceries, etc. In the future, they may become key nodes in community commerce, not only providing physical pickup points but truly becoming the 'head of the household' in the half-hour living circle of community commerce. With the empowerment of various platforms, they can deliver better products and more services to community consumers. From this perspective, supermarket owners need to successfully transform into new roles, bringing more and better value to community consumers' lives.
Summary:
Community group buying has two sides. When we see the impact and anxiety, we should also calmly and objectively see the value behind it: the improvement of overall industry cost efficiency, the upgrade of people's lives from basic needs to better needs, the progress of traditional businesses under pressure, and the iteration of new talent and new opportunities!
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