As competition in first- and second-tier markets intensifies, lower-tier markets have become a breakthrough for consumer goods companies and internet companies seeking new market growth. Major internet companies are also laying out strategies to seize the dividends of lower-tier markets through sharing and community group buying.
At the same time, brand owners and distributors are actively seeking more store coverage and consumer reach through cooperation with new business formats such as B2B and community group buying. Correctly understanding lower-tier markets and their consumers has become a crucial prerequisite for FMCG companies and internet giants to win the battle in these markets, and the digitalization of retail stores in lower-tier markets has become a key lever.
Recently, New Distribution, in conjunction with "Huoquanquan," officially released the full version of the "2020-2021 Research Report on B2B2C Cooperation of Retail Small Stores in Lower-Tier Markets" (hereinafter referred to as the "Full Report"). This report took three months to conduct in-depth surveys and interviews with 1,161 stores across 168 cities in 29 provinces nationwide, covering the survival status of small stores, purchasing channels, and cooperation with B2B, O2O, community group buying, and unmanned retail.
We hope this report can help brand owners and distributors understand the most authentic survival status and digitalization level of millions of retail small stores in lower-tier markets, gain insights into the changes occurring in these stores in the digital era, and thereby formulate targeted marketing and market strategies to win in the channel. Compared to the circulation version of the "2020-2021 Research Report on B2B2C Cooperation of Retail Small Stores in Lower-Tier Markets" (hereinafter referred to as the "Circulation Report") released by New Distribution in April, the Full Report adds 45 pages, supplementing and refining dimensions such as store and owner profiles, characteristics of lower-tier markets and stores, store operating conditions, store purchasing behavior, store B2B ordering behavior, store evaluations of B2B cooperation, distribution and coverage of B2B platforms, and store cooperation behavior and evaluations with community group buying.
In terms of store profiles, more detailed descriptions are provided on the age of store operators, business types of surveyed stores, and the number of operators in stores of different sizes, helping brand owners, distributors, and industry practitioners understand the proportion and distribution of stores by age and business type in lower-tier markets. Unlike first- and second-tier markets, lower-tier markets show significant differences in consumer behavior, consumption patterns, and the operating and purchasing methods of traditional retail stores. The vast number of stores and the large population base in lower-tier markets also serve as the foundation and motivation for our exploration of the survival status of retail small stores in these markets.
Differences in consumer behavior lead to differences in the main product categories of retail stores. In the Full Report, we compare the main product categories, pre- and post-pandemic turnover and profit, and key factors in choosing purchasing channels between upper-tier and lower-tier markets, and elaborate on the weight of purchase amounts across different channels for lower-tier stores, helping readers clearly understand the operating conditions and purchasing channel changes of retail stores in lower-tier markets.
In terms of cooperation with B2B platforms, there are also significant differences in ordering categories between lower-tier and upper-tier markets. In the Full Report, we compare key dimensions such as ordering category differences and changes, order amounts, number of SKUs per order, ordering methods, and delivery times between lower-tier and upper-tier markets, and analyze the main reasons why lower-tier stores refuse to cooperate with B2B platforms, striving to present the most authentic development status of the B2B business format in lower-tier markets.
At the B2B platform level, unlike the fierce competition among B2B platforms in first- and second-tier markets, the number of B2B platforms in lower-tier markets is relatively small and more dispersed. Meanwhile, after nearly a year of adjustment, the overall development of the B2B business format has shown a downward trend, with a significant decline in the number of B2B platforms in both upper-tier and lower-tier markets. In this context, the distribution of platforms in upper-tier and lower-tier markets, the coverage of B2B platforms in different tier markets, the key B2B platforms used, and the top 5 B2B platforms in terms of comprehensive competitiveness across seven major regions in China show significant differences in dimensions such as product, price, marketing, field service, and comprehensive service. For detailed information and data, please refer to the Full Report.
The New Distribution research and consulting team also conducted a focused comparison between lower-tier and upper-tier markets on the penetration rate of home delivery services for small stores, cooperation with O2O platforms, awareness and cooperation with community group buying, main product categories for cooperation with community group buying platforms, number of cooperation platforms, key cooperation platforms, frequency of group opening, and transaction prices at group opening, thereby highlighting the B2B2C situation of small stores in lower-tier markets.
In addition, the Full Report elaborates on the reasons for cooperation between lower-tier stores and community group buying, the results of cooperation, key factors in choosing community group buying platforms, and the difficulties and demands encountered during cooperation, hoping to reflect the full picture of community group buying development in lower-tier markets.
The above is part of the full version of the "2020-2021 Research Report on B2B2C Cooperation of Retail Small Stores in Lower-Tier Markets." The following is the full content of the Circulation Report. Reply with the keyword "2021 Report" in the backend of the New Distribution official account to obtain the PDF file of the report.
For purchasing the full report, please contact: Liu Shaode +86 176-0011-7287 liushaode@fmcgdealers.com
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