1. A One-Sentence Overview of the Community Group Buying Track The community group buying track is not just hot; it's getting hotter. The recent moves of the three internet giants—Meituan, Didi, and Pinduoduo—can be summarized in five points: expanding everywhere, opening points (group leaders), setting up warehouses, poaching talent, and offering low prices.
2. Whose Rice Bowls Are Being Smashed by Community Group Buying? *Community group buying platforms are pushing upstream brands and manufacturers to evolve towards optimal cost-performance products, which is what Ma Yun calls "new manufacturing." Brands that lack the ability to promote and spread word-of-mouth will inevitably be eliminated, as they lose the basic function of communicating and dialoguing with users.
*Traditional distributors are being restructured into supply chain operators; the second-tier distributors that deliver to community-based outlets will be removed. Many second-tier distributors are located in comprehensive wholesale markets, and as they are largely phased out, the decline of wholesale markets will be an indisputable fact.
*It will further reduce foot traffic and entry rates at comprehensive KA (Key Account) stores, directly leading to the closure of "3-low" (low per-person efficiency, low per-square-meter efficiency, low time efficiency) hypermarkets. It is estimated that one-third of comprehensive hypermarkets will disappear, due to lengthy and outdated channel efficiency and years of accumulated credit supply systems that keep planned purchase prices artificially high. Users will vote with their feet.
*It will accelerate the integration of community-based chain stores, including CVS convenience store chains, fresh food chains, and pharmacies, into a unified store group (chain stores counter-harvest community group buying), thereby building a new store-based commerce transformation and forming a third force in same-city e-commerce retail. It will push 6.8 million community terminal small stores to catch the last train of mobile internet.
Policy empowerment: The September 29 "Opinions" point out that the state will focus on supporting physical stores to establish omni-channel, round-the-clock connections with consumers through the internet, encouraging physical enterprises to return to the essence of business, using e-commerce to attract customers, and encouraging enterprises to continuously innovate business models in response to the needs of the times.
*It will eliminate and replace FMCG B2B platforms (based on the logic of BC integration, like mobile phones replacing pagers), delivering a fatal blow to the already struggling FMCG B2B sector, potentially leading to a total industry collapse, including the top two players: Alibaba Retail Link and JD New Path.
*It will seize market share from JD, Taobao, and Pinduoduo for product categories unsuitable for drop-shipping. (1. Bulky items, 2. Low-value items, 3. Heavy items, 4. Fresh and short-shelf-life items).
*It will break into and counterattack the local life services market monopolized by giants like Meituan and Ele.me, which is the fundamental reason Meituan is entering community group buying: better to attack than be attacked.
In summary, it will destroy and reset the width and length of traditional manufacturer channels, compressing and rerouting the long-standing "manufacturer → distributor → second-tier distributor → retail store → user" chain, forming a new pattern: "manufacturer → operation service provider → platform → pickup point ← user."
3. Who Are the Real Opponents of Meituan, Didi, and Duoduo? A. Are they the old top three in the track: Xingsheng Youxuan, Shihuigou, and Tongcheng Life? No. B. Are they local strong platforms like Youjingyoutian, Xiaoxiongle, and Zhihuazhiguo? No. A and B are not opponents but allies of Meituan, Didi, and Duoduo. They have formed an alliance to rob KA comprehensive supermarkets like Walmart, Carrefour, and RT-Mart, targeting standard products and directly eliminating "3-low" hypermarkets, with an estimated one-third of comprehensive hypermarkets disappearing. They also incidentally affect fresh produce specialty stores like Baiguoyuan and Qian Damo, but the impact is limited.
The conclusion is that the biggest enemies of Meituan, Didi, and Duoduo are user awareness and consumer shopping habits. Before community group buying e-commerce becomes a mainstream shopping scenario, they are all cultivating the market, forming user habits, and accumulating big data. These three giants are aiming for a trillion-yuan same-city retail goal, not just to eliminate competitors.
4. Will Meituan's De-emphasis on Group Leaders Become a Trend in Community Group Buying? Community group buying has two basic pillars: one is online pre-sale in the transaction link, and the other is store pickup in the delivery link.
Meituan is exploring a model of "grid warehouse + rider delivery to home" to replace "grid warehouse + group leader pickup point." This approach depends on its own food delivery DNA, and only Hema Xiansheng + Ele.me combination has the conditions to follow.
From an overall fulfillment perspective, Meituan's approach is not economical. The last 500 meters are significantly more costly than self-pickup, and labor costs will be an insurmountable gap. This is why the front-warehouse instant delivery model only works in developed southeastern coastal areas. After all, it circles back to Meituan Maicai's approach. "Cost reduction and efficiency improvement" is the touchstone for evaluating any business model.
5. What Is the Fundamental Difference Between Xingsheng Youxuan and Internet Giants Like Meituan, Didi, and Pinduoduo? There is a huge difference in business routes: Is community group buying about traffic competition or fulfillment competition?
Internet giants use retail business to do internet, with the ultimate goal of harvesting traffic. In the eyes of internet giants, group buying is no different from shared bikes or power banks; it's just a corner of their business map, a local war in the business domain.
Xingsheng Youxuan uses internet methods to do retail. Xingsheng Youxuan originated from Furong Xingsheng, with the mission of "reviving stores," "empowering upstream," and "changing consumer lifestyles." Its retail DNA is strong. For Xingsheng Youxuan, community group buying is everything; it's an all-out war.
In terms of business philosophy, internet giants prioritize expansion speed, with a strategy of first occupying territory, grabbing group leaders and users, and then gradually improving operational quality. In contrast, Xingsheng Youxuan prioritizes operational quality, focusing on service experience and fulfillment efficiency, and only then "runs desperately."
Internet companies have been invincible in e-commerce, ride-hailing, food delivery, and other fields, accumulating a set of effective methodologies. In these fields, internet companies only need to connect two ends: B-end and C-end, such as merchants and consumers, car owners and passengers, restaurants and diners—a typical "two-wheel drive model."
Community group buying, however, is a "four-wheel drive" business, involving the connection and integration of four dimensions: big B-end (suppliers), small B-end (store owners/group leaders), C-end (consumers), and logistics. Therefore, whether the internet giants' existing "two-wheel drive" methodology can handle the "four-wheel drive" model of community group buying is the opportunity point for Xingsheng Youxuan.
Internet giants have advantages in traffic and capital, but have shortcomings in stores, logistics, and supply chain. Comprehensive analysis shows that except for traffic, where Xingsheng Youxuan has no inherent advantage, it has certain competitive barriers in stores, supply chain, and logistics.
6. What Are the Chances of Success for Hema Xiansheng, CP Group, Douyin, and Kuaishou Entering Community Group Buying? Hema + Retail Link + Cainiao Post can remain undefeated, but despite being Alibaba's imperial guard, it's difficult for them to enter the top three.
CP Group's personal entry into community group buying is courageous but with uncertain prospects. The product structure width and depth vary at different stages of this track. Although CP Group's product categories are broad, they still cannot support it, and this self-production and self-sales approach would be a disaster for its main business. Moreover, Lotus Supermarket as a retail KA format has limited supply chain support, making it difficult to synergize.
Douyin and Kuaishou's strengths are far from the requirements of the community group buying model, roughly equivalent to Didi's Orange Heart Youxuan. Unless miracles happen, it's hard for them to win.
7. With Strong Enemies Pressing, Can We Still Start a New Community Group Buying Platform Now? Fulfillment capability is the key to success or failure in community group buying.
Supply chain is the foundation, determining product quality and stocking capability; stores (group leaders) are the key, controlling traffic, after-sales, and other connection and experience links; warehousing and distribution (logistics, sorting, delivery) is the core, determining timeliness, accuracy, and quality of arrival.
Therefore, this entrepreneurial opportunity depends on the founder's comprehensive qualities. Regarding the three basic elements—supply chain, group leaders, and warehousing/distribution—if you only have one, do not enter; if you have two, consider entering moderately; if you have all, you can boldly enter.
This conclusion is premised on the vast third-tier and lower-tier markets. In first- and second-tier cities, the risk is too high and the enemies too strong; it is strongly recommended to avoid them.
8. As a Community Small Store Owner, Should I Resolutely Refuse Community Group Buying Platforms or Actively Embrace Them? As a community convenience store, it's not a question of whether you want to; you simply cannot refuse.
Because the small supermarkets, fruit stores, tobacco and liquor stores, beauty stores, express delivery stores, laundry stores, barbershops, print shops, and property offices around your store have all been developed by various platforms as pickup points for group buying. Your individual refusal will only become a sad joke.
In Chinese commercial history, KA supermarkets swept through community small stores, and traditional e-commerce represented by Taobao also robbed them. Yet community small stores, like leeks, have grown stronger after each cut, forming a sea of 6.8 million commercial outlets.
This wave of community group buying is just a manifestation of same-city e-commerce retail. This mobile internet + local retail fundamentally cannot do without community small store pickup points in the delivery link, which is also an opportunity for community small stores to self-evolve and embrace the internet wave.
Community small stores + community group buying platforms form a 500-meter shopping method for users, competing with the 1500-meter distance to comprehensive KA supermarkets.
Who are our enemies? Who are our friends? Think about it carefully.
Benefit tip: The community group buying track is at a stage of gods fighting and chaos emerging, which is the only best time for community small stores to "pluck wool" and "cut leeks." Sharpen your sickle!
9. How Can Ordinary People Like Us "Pluck Wool," "Cut Leeks," and Hitch a Ride on This Wave of Community Group Buying Dividends? While others dig for gold, you sell water.
This commercial upheaval will establish the competitive landscape for at least the next 10 years. Business people need to think deeply and reposition themselves.
Providing supporting services for the same-city community group buying e-commerce retail industry chain is the most convenient and economical choice. For example, traditional distributors can transform into platform supply chain service providers; those with warehousing and logistics vehicles can apply to become grid warehouses for the giants; those with strong business capabilities can develop group leaders for platforms (as BD); and at the very least, you can engage in arbitrage, as platforms often have price-inverted products, so you can team up to buy and resell for price differences.
In short, as long as your thinking doesn't slip, methods will always be more than problems.
10. Why Is Community Group Buying Worthy of Being the Standard-Bearer of China's Third Retail Revolution? New retail is never a new thing, nor is it defined by Ma Yun alone. Of course, the concept of new retail was promoted by Ma Yun, including the borderless retail and smart retail mentioned by Alibaba's allies. In fact, they are all the same thing, just with different names.
When an innovative thing or object appears and no suitable name is found temporarily, it is expressed as "new XX" based on existing cognition.
In the history of Chinese retail, how has it evolved from the perspective of consumer behavior?
For a long period in history, urban and rural residents bought goods at supply and marketing cooperatives. Between the seller and buyer was a cold cement counter. That was the seller's era, where users had no choice; being able to buy was the greatest satisfaction.
It wasn't until 1998 that Walmart came to Shenzhen, China, opening the era of open-shelf self-service shopping. This was the beginning of the consumer sovereignty era, including representative convenience store chains like 7-11. The store size determined the difference between Walmart and 7-11, but both were businesses based on geographic location, which we define as real estate retail.
In fact, during the era of supply and marketing cooperatives and consignment points, self-service supermarkets were the new retail at that time. This location-centered self-service supermarket, convenience store, and department store physical retail is defined as the first revolution in China's retail industry.
By 2003, Alibaba started Taobao, turning the shelf from physical space into virtual webpage space for the first time. Technology broke the limits of time and space for users, allowing consumers to purchase a vast array of products anytime. Online e-commerce could operate 24/7 without closing.
Online e-commerce, led by Taobao, Tmall, JD, Suning, and Vipshop, solved the shackles of limited purchase time. Whether in the PC era or the mobile internet era, with product category search as the core feature, express logistics and smart payment are the infrastructure of online merchants. According to the latest 2019 statistics, online e-commerce accounts for 23% of total social retail sales.
During the heyday of the supermarket format, online e-commerce emerged as a new force. At that time, Taobao online e-commerce was the new retail, and the supermarket format became traditional retail. At this point, online search-based e-commerce is defined as the second productivity revolution in China's retail industry.
Subsequently, whether it was the micro-business masters Yunji and Banma, or Pinduoduo which is more Taobao than Taobao, and later community e-commerce like Xituan, Haituan, and Haidun, none changed the basic logic of online e-commerce.
In fact, community group buying was already brewing in 2015, with the common scene of group buying seasonal fruits via WeChat group chains. We take June 2018, when Xingsheng Youxuan, the pioneer of community group buying, started its first group, as the epoch time.
Community group buying combines the low-cost delivery of offline real estate retail with the low-cost product display logic of online search-based e-commerce. This innovation embodies the three-dimensional combination of lowest cost, highest efficiency, and best experience.
Based on the sticky connection of semi-acquaintance relationships, it transforms cognition into transactions, embodying the trinity of "relationship, cognition, and transaction" as a business model. Community group buying directly connects the three dimensions of "online, community, and offline" through information flow, forming a closed business loop.
Community group buying is no longer a deepening subdivision of traditional search-based e-commerce, but a brand-new retail format that is becoming a basic shopping scenario for consumers. Based on this, it is seriously judged as a groundbreaking innovation, worthy of being called the third productivity revolution in China's retail industry.
Special thanks and references: "Kaiman 4000," "Third Eye Watching Retail," "Order Rabbit B2B," "Water Boiled Marketing," "Community Group Buying Done This Way"
Chen Haichao | Chief Consultant, Mai Marketing New Retail Consulting Agency He Nian | Researcher, New Retail & Community Group Buying
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