The Epidemic Has Prompted The Community Group To Buy "Two Degrees" For Sustainable Profitability.

Under the outbreak of the new crown pneumonia, community group buying has become the focus of all efforts.

During the epidemic period, community group buying is in a high load state, and the order quantity of some group buying platforms is 5-10 times higher than before. Boxes, Jingdong, BBK, and even brand Shang Zhou black duck, Ye Amei and so on have also entered the bureau to open community group buying mode. It is understood that the most serious month of the epidemic, the number of active users of box horses increased by 127.5% over the same period last year, and the proportion of online orders increased from 50% to 80%.

The first appearance of community group purchase started from the explosive growth of WeChat's small program before and after 2017. Subsequently, community group buying completed its early development with capital support. Public data show that since 2018, the total amount of financing of more than 10 community group buying platforms has totaled more than 4 billion yuan. But in the past 3 years, the layout of the industry has gradually become silent. By the second half of 2019, "merging", "alliance" and "death" have become the theme of community group buying.

In May 14th, Yamai salt baked chicken paw CEO Wang Chi told reporters in twenty-first Century economic report that there has been no particularly prominent platform for community group buying because the birth of any new thing takes time and accumulation. "The outbreak suddenly changed the consumption habits of consumer groups, which made them enjoy the convenience brought by community group buying. After the end of the epidemic, some people will retain the habit of consumption. Community group buying mode has been ignited again. We should see the huge market opportunities in this area.

Data show that the domestic scale of e-commerce users is expected to reach 400 million passengers by 2020. Insiders also predict that the market will reach 500 billion yuan in the next few years.

Head viscosity

Community group buying is a real estate based on LBS technology, driven by the C side B terminal business channel. The main mode is to set up a WeChat group online based on the offline real cell. The head of the group will publish the commodity pre-sale and group buying commodity information on the WeChat group online. After placing the order, the customer will send the goods to the plot in a unified way, and the user will pick up the goods at the next line and complete the transaction. The platform provides brand, technology, supply, logistics, after-sales service and other support.

In this mode, leaders are both the sellers and consumers in the community, and everyone in the community is neighbors, which has a trust foundation and plays a great role in this mode.

"I have two main factors in the group buying, one is the leader, and the other is the price of the goods." Ms. Fu, who was in Wuhan during the epidemic, began to use community group buying. "Because the head of the Department is required to check the quality of the goods, it is also important for the head of the regiment to be responsible for distributing the items that are purchased, so this person is very important. As for price, if I can't buy it cheaper than myself, I still prefer to buy it offline.

According to Accenture's consumer insight report, consumers account for more than 40% of impulse buying in social networking applications. The group buying based on offline social relationships satisfies the social needs of people like Bao Ma and others, and can stimulate consumption and increase frequency of purchase.

Compared with offline stores, community group buying eliminates the rent and manpower costs, and uses pre-sale mode to make sales decisions. Compared with traditional electricity providers, community group buying can go directly to the community from origin, factories and large transfer warehouses, and the last mile is either the head of the group or the consumer, which reduces the cost of each performance.

This pattern coincides with the restriction of travel during the epidemic period, and further helps to grow its scale again. In April 29th, the Wuhan local community electricity supplier Food Association jointly announced the "marriage" with China Merchants supermarket, one of the four oldest commercial listed companies in Wuhan. In the current unstoppable new retail and new consumption outlet, the new chain development mode under the online store of "supermarket stores + community shops + community" has torn a gap in the fierce commercial battle.

Ye Amei has entered the community group buying section since March, and his original intention is to solve his own sales problems. Wang Qi said: "the establishment of the requirements of the head of the industry is not standardized, and the system and standards need to be improved." He pointed out that in the future recruitment of senior colonel, a certain threshold should be set up to train heads of their own products. While ensuring the income of the head of the regiment, it also ensures that there is only one head in a small area within a certain area. In addition, the industry should also give the head of the team a sense of value and dignity to promote the professionalization of the regiment leader.

On the other hand, in community group buying, league members can not only accept the group purchase initiated by the head of a group. Most of the time, the league members want to find what products they want. Wang Qi said: "therefore, enriching the product category that the company can provide is also one of the effective ways to enhance the stickiness of the regiment leader. Ye Amei has joined chicken soup, aquatic products and other categories to promote diversification and gradually attract more heads of regiment.

Profit challenge

There are many pain spots in the popularity of community group buying.

"First of all, many businesses buy their orders every day for a very long time, which is why we are going to make the platform. This allows more businesses to concentrate on making products, and we train professionals to do order consolidation, demand docking and logistics transportation. Wang Qi feels deeply. "Secondly, too many products of the same type lead to too many customers' choices. We need to enhance brand recognition and get more consumers' favor. At the same time, we will increase the differentiation between our platform products and other platform products. In addition, more than two months of group buying data show that the price of goods will be directly linked to sales volume, and we still prefer special products. I can only ensure that products with better quality are offered under the same price, but they are slightly cheaper than others at the same quality, rather than blindly joining price wars.

Therefore, the gross profit margin of community group buying is generally very low, which makes the profitability of the platform worse.

Insiders pointed out: "repeat purchase rate, coverage and penetration is also the key to the profitability of community group buying." The continuous purchase of a single person on a single item or a platform indicates the user's recognition and habit of this commodity and platform.

According to the characteristics of community group purchase, it is not the brand that falls to the community, it is called coverage. It is necessary to see how many residents of the community can cover the specific number of households, so as to avoid putting the cart before the horse. Because coverage directly affects the density of your order, and the order density determines the Commission earned by the regiment on your platform every day. It also determines the cost and efficiency of the performance. So the coverage rate is all the same.

Permeability is the next GMV growth point for the community group buying brand after its mid-term expansion, and even the future profit point.

If the future platform wants to find new profit and growth direction, it may be necessary to continue to detailing and transferring to the platform of community group purchase in the original user consumption commodity structure, and find new commodity categories with high gross profit for itself, so that the platform can achieve a profit transformation in a future node.

Based on the platform of community group buying, it is necessary to make an extension of consumption. At present, the community group buying service is mainly based on the kitchen scene. In the future, community group buying may extend to the living room, bathroom, bedroom and so on.

The industry continues to add: "we have observed that community group buying companies make very little profit, mostly at a loss or even a huge loss. We expect the remaining players in this track to be backed by plenty of cash flow. From the perspective of market demand, this subdivision track is market oriented, but community group buying will be a supplementary channel for more company layout. "

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