Tuan800: 2011 China Group Buying Industry Statistics Report

2011 has come to a successful conclusion. The Tuan800 Data Report Team would like to thank all colleagues in the industry for their attention to us in a short paragraph, and remind you to make sure you have read and understood the following statement when citing the data in this report. Please continue to pay attention to the Tuan800 Data Report Team. We will contribute more abundant and accurate content or data in 2012. Thank you.

1. Statement on the Statistical Scope

This report only counts service-oriented self-service group-buying websites, that is, group-buying websites that clearly position themselves (or basically meet the requirements) as localized e-commerce for daily consumption, and websites that mainly operate group-buying integrated operation platforms ( QQ group-buying , Juhuasuan , etc.), mainly engage in physical group-buying ( Jumei Youpin , etc.), and offline group-buying are not included in the sample collection of this report for the time being, because of the closed nature of the data within the platform and the interference with the horizontal comparison of group-buying O2O direction in the past year. Please be aware of this. In the 2012 statistical report, we will try to analyze in more dimensions based on the feedback from the industry and the public to show the diversity and complexity of the group-buying market in mainland China.

2. Statement on the source of data

All sales data in this report are derived from the public API data records of various group buying websites. If the above records are inaccurate due to the group buying websites themselves, Tuan800 will use the monitored data results as the basis for the final release of this report.

3. Statement of Report Independence

Without affecting the scheduled release of this report, all group buying websites are welcome to proactively provide reliable details of the month's sales, which will be verified by Tuan800 but not guaranteed to be adopted. They will only be used as a reference for the preparation of this report to ensure the fairness and independence of the report.

4. Disclaimer

This report is only used for industry observation and data research by Tuan800 (www.tuan800.com) Information Channel and does not represent any commercial position. Any statistical method has corresponding errors. Since July 2010, Tuan800 has insisted on monthly statistical work, aiming to objectively reflect the industry situation, and has also been widely recognized by the industry and the public. There are many factors that change in the group buying market, and the statistics of a certain month do not represent the overall strength of each group buying station. We recommend that all parties treat the monthly report rationally, and do not encourage or support any excessive interpretation and publicity and hype using partial data in the report. If you have suggestions or opinions on the report data, please contact the editor of Tuan800 Information Channel (contact information: [email protected])

1. Inventory of sales data of online group buying industry in 2011

◆ 300 million people "group together" to consume, saving more than 19 billion yuan in the whole year

According to the statistics of Tuan800, in 2011, there were 540,000 group buying activities launched in the domestic group buying market, with total sales exceeding 11 billion yuan, equivalent to 5.5 times that of 2010; more than 300 million people bought goods or services on group buying websites, with the average per-person consumption amount being about 35 yuan. Calculated based on the average annual discount of 36%, group buying users saved more than 19 billion yuan in consumer expenditure in 2011, with an average saving of about 62 yuan per person per consumption.

According to the relevant data released by the statistics department, the per capita consumer expenditure of residents in various cities generally increased in 2011, with a year-on-year increase of 9 to 12 percentage points. Taking Beijing as an example, residents need to spend 2,000 to 2,200 yuan more on food, clothing, etc. than in previous years. Although group buying has not fully affected the trillion-yuan-level consumer market, for consumers who have already used group buying, the growth of their consumer expenditure in 2011 was reduced by at least 3 percentage points on average.

2. Inventory of changes in the number of group buying websites in 2011

◆Reshuffle ≠ quick death 2012 is still worth looking forward to

It took about 6 to 8 months for group buying websites to go from "a war of thousands of groups" to "mass disappearance". The end of 2010 to the first half of 2011 was the most enthusiastic performance period for group buying websites. The total number of group buying websites increased dramatically, and they were popular with media and venture capital. Large group buying websites expanded rapidly and burned money to compete in advertising. The same slogan "For group buying, go to XX website!" was spread all over every corner of the city, and many local small and medium-sized group buying websites emerged like mushrooms after rain. However, this enthusiasm lasted less than two quarters. Many large group buying websites closed their local branches after trying for a few months. Due to the break of venture capital capital chain and limited revenue, group buying websites had to downsize and lay off employees in the third quarter to survive the coming winter in an energy-saving and low-consumption way. Doubts such as "the winter of group buying is coming" and "group buying reshuffle" arose everywhere, and the media also turned their cameras and began to pay a lot of attention to the credibility dilemma of group buying websites and the problem of "zombie group buying websites". Many reporters dug deep to find the founders of closed websites or similar "specimens" who could speak out in person to interview. This period marked the end of the great leap forward era of group buying. Group buying sites began to focus on improving their refined operational capabilities, and the adjustment period of sedimentation and stratification officially began.

According to the data from Tuan800, a large number of group buying websites did disappear in September 2011, and the total number of websites continued to drop to more than 3,000 from October to December. According to our survey at the end of August, the actual number of surviving websites may be even smaller. Therefore, the era of group buying has indeed arrived, and this trend will continue for a long time. But at the same time, it should be noted that the reshuffle of group buying does not mean that group buying will die quickly. The total sales of group buying in December reached 1.58 billion yuan, and this total amount does not include the sales of composite platform websites such as Juhuasuan and QQ group buying. According to relevant data from the National Bureau of Statistics, the CPI rose by 5.4% in 2011. Therefore, the group buying model is still valuable for saving living expenses, and a large number of young consumers have developed the habit of group buying. The development of the group buying industry in 2012 is still worth looking forward to.

Description of the method for investigating the survival status of local group-buying websites: By visiting local group-buying navigation websites in eight popular cities, including Guangzhou , Tianjin , Nanjing , Wuhan , Chengdu , Hangzhou , Changsha , and Xi'an , a survival status investigation was conducted on the local group-buying websites recommended on their homepages, with a total of nearly 200 samples collected.

3. Inventory of first-tier group buying companies in 2011

◆4 group-buying companies achieved annual sales of over 1 billion yuan

◆ Sales share: Lashou, Meituan , Wowo lead in average single profit; Dianping, Nuomi , Manzuo dominate

It is undeniable that the capital power behind the group-buying websites and the fierce competition between them have played an important role in the popularization of the group-buying concept. Compared with 2010, the scale, revenue and service system of major group-buying websites have made a qualitative leap this year. From strengthening the product review system to the initial establishment of rules such as "refunds for expired and unconsumed products", all of these prove the maturity and progress of group-buying websites amid criticism. The most intuitive way to measure this growth is the birth of the monthly "100 million yuan club". In 2010, the highest monthly sales of a group-buying website was only 68.87 million, while in 2011, 7 group-buying websites successively entered the "100 million yuan club". There were 4 group-buying websites with annual group-buying sales exceeding 1 billion yuan, namely Lashou.com with 1.63 billion yuan, Meituan.com with 1.45 billion yuan, Wowotuan with 1.21 billion yuan and Dianping.com with 1.01 billion yuan. The total annual sales of the 10 first-tier websites accounted for 88% of the total industry sales. In fact, this ratio was flattened by the data in the first half of the year. Starting from July in the second half of the year, the market share of small and medium-sized websites shrank due to the winter environment of group buying. By September, a large number of them had been eliminated. The first-tier websites saw a significant increase in both the number of group purchases and sales share. By December, the sales share of the 10 first-tier websites exceeded 90%.

In terms of sales share, Lashou.com, Meituan.com and WoWotuan are currently the top three, with their shares accounting for 14%, 13% and 11% of the national total respectively.

In addition to sales share, another angle to observe is the average profit per order of group buying websites. If the commission rate is uniformly calculated as 10%, the average profit per order can be calculated according to the formula "customer unit price × 10% × average sales volume" (Note: average profit per order refers to the average commission received per group purchase, not the commission rate; average sales volume refers to the average number of purchases per group purchase). We can see that the websites with the highest average profit per order are Dianping.com with 10,207.8 yuan, Nuomi.com with 4,312.1 yuan, and Manzuo.com with 3,611.1 yuan.

◆The "dark horse" Wowotuan rose in June, and the top three players took turns to be the banker in the second half of the year

◆ Dianping.com, Ftuan.com and Dida.com are “good at long-term running” and have steady growth

From the monthly sales ranking, Lashou.com and Meituan.com rose alternately throughout the year, leading each other and always in the first camp. Throughout the year, Lashou's leading position has not been shaken. Wowotuan, which was still unknown in 2010, started to exert its strength from March to May 2011, and rose strongly in June, joining the "melee" of first-tier websites and making it into the top three, becoming the most eye-catching "dark horse" in the group buying industry in 2011.

From the curve below, it is not difficult to find that there are three websites that are "hidden in the city" but have always maintained a steady growth momentum - these three websites are Dianping.com, Didatuan and Ftuan. Dianping.com is attached to Dianping.com , which has "focused on food, drink and entertainment content for 8 years", while Didatuan insists on "steady and balanced boutique group buying". Both are "slow-growth" calm group buying companies. After Ftuan received multiple rounds of high-value VC investment in the third quarter, it not only has a solid capital reserve, but also has opened up the operation of two secondary battlefields, QQ group buying and Kaixin group buying , and has launched three swords to enter the market.

A year ago, experts predicted that there would be no more than 10 group-buying websites surviving in China. However, the actual situation in 2011 shows that although group-buying websites have declined due to rapid expansion, the commercial value of the group-buying industry itself is still "worth a lot" after the water is squeezed out. Since the total transaction volume of group-buying exceeded 1 billion yuan in July 2011, it has remained at this level. In December, it reached the peak of the monthly group-buying transaction volume of the whole year with 1.58 billion yuan. The top 10 comprehensive large-scale group-buying websites in 2011 are not only basically stable, but also gradually differentiate into important roles such as the "100 million yuan club" and the "200 million yuan top three" to occupy a large market share; group-buying websites in vertical industries such as tourism and beauty, as well as small and medium-sized websites with unique local merchant resources, still have their own space. This coexistence model of "Wal-Mart + community supermarket" may be the most suitable choice for the consumption differences among cities at all levels in China. Gold is finally found after the great waves wash away the sand. No matter how the outside world judges it, China's group-buying market has proved its value in the pain.

4. Inventory of group purchase categories participated by merchants in 2011

◆Whoever wins the catering industry wins the world. Catering group purchases “eat up” 3.95 billion yuan in the whole year

◆150 million people went to group buying websites to "shop online" to get a piece of Taobao

In 2011, the catering group purchase consumption reached 3.95 billion yuan, accounting for 36% of the total group purchase consumption. It can be said that "whoever wins the catering industry wins the world". About 80 million people made catering consumption through group purchase websites. According to the customer unit price (average per person consumption amount) of 49 yuan and a discount of 48%, consumers who chose "group eating" in 2011 could save 53 yuan per person per time. The consumption of eating out was the fastest growing part of urban residents' consumption expenditure in 2011. In the first half of the year, the expenditure of Tianjin citizens increased by 11.7% year-on-year, and Harbin was as high as 27.2%. The price increase has a great impact on the lives of low- and middle-income citizens. The value of group purchase saving money is highlighted in this regard. However, consumers' evaluation of group purchase consumption still needs to be improved in 2011. If saving money comes at the cost of reducing consumption experience or even being deceived, no consumer will be willing to do so. This is an issue that group purchase companies need to pay attention to. Another "side effect" of group buying of meals is that it increases the frequency of family members' collective consumption outside the home. It is not only labor-saving and worry-free but also economical and affordable, making the elders who have always been frugal happy to participate, becoming a booster of family warmth.

In addition to catering group buying, another bright spot is the group buying of physical goods. Of course, it is a bit exaggerated to say that Taobao has a share of the pie, because they are not on the same order of magnitude. For the young group buying industry, selling physical goods is also a helpless move, because it needs to attract popularity and boost sales. In 2011, nearly half of the orders completed by group buying websites came from physical group buying. We believe that "online shopping" on group buying websites is only a temporary phenomenon, and it is a short-term hesitation of consumers between irregular online shopping and even more irregular group buying at the current stage. After all, the number of "group buying" of 300 million people has outlined a huge consumer group - they have developed the habit of group buying and have realized the convenience of this model for daily consumer life.

◆ Collecting a few extra dollars for group buying to keep the cinema's vacancy rate low

In the first three quarters of 2011, group buying contributed about 7% of the movie box office, and it is estimated that the proportion will not be lower than this for the whole year. For non-first-tier and newly opened cinemas with high vacancy rates, how to fill the empty seats? Group buying is currently the most effective way. The originally empty seats not only brought in traffic, but also generated nearly 900 million yuan in box office revenue throughout the year, at least it looks good. As a senior official of a theater chain privately admitted, "Group buying has undoubtedly lowered the high movie ticket prices, but it has also filled every screen with young people who love movies."

Other individual items with considerable sales include photography and hotel tourism, with annual transaction volumes of 724 million yuan and 440 million yuan respectively.

5. Inventory of group buying market in various regions and cities across the country in 2011

◆Group purchases covered 223 cities throughout the year, and nearly 80% of prefecture-level cities had group purchases

◆Annual sales in 24 cities exceeded RMB 100 million, with Beijing and Shanghai exceeding RMB 1.2 billion

◆Third and fourth tier cities may become important growth points in 2012

In 2011, group buying expanded rapidly in the first half of the year, covering 223 cities. Nearly 80% of residents in prefecture-level cities (note: non-prefecture-level administrative units) can purchase local consumer life services through group buying websites. Of course, the coverage mentioned here is also for local consumer group buying, and the coverage of physical group buying is less affected by regionality.

Data shows that 24 cities had annual group purchase sales exceeding 100 million yuan, with Beijing and Shanghai leading with sales of more than 1.2 billion yuan each, and Guangzhou, ranked third, with about 600 million yuan.

By the end of December, there were 109 cities with group purchase sales of more than 1 million yuan that month, far exceeding the 30 to 40 at the beginning of the year. In other words, group purchases have gradually become popular in 2011, and this consumption pattern may spread to more third- and fourth-tier cities in 2012. Similar to elders living in small counties asking their nephews and nieces in big cities how to shop online, young group purchases also need a process of "letting users teach users". According to the case of the popularization of online shopping, this "popularization" process will last for two to three years. During this period, the scale of the group purchase consumption market may not grow rapidly. Instead, as group purchases become more standardized, their value in saving residents' consumption expenditures will gradually become prominent and form a rigid market demand. At the same time, as a fashionable and convenient local consumption method, it will develop steadily. Therefore, the important growth point in 2012 may be the further promotion and popularization of third- and fourth-tier cities.

6. Inventory of group purchase complaints

◆Over 10,000 complaints were filed throughout the year, but the resolution rate was only 55.3%

Throughout 2011, group-buying users posted 11,483 complaints on the Tuan800 group-buying complaint area (bbs.tuan800.com/complain), which is 10 times the number of complaints in 2010. Among them, 6,349 complaints were resolved, with a resolution rate of 55.3%, which is lower than the resolution rate of 64.7% in 2010. However, considering that the total number of resolved complaints is also 10 times that of 2010, the service quality of group-buying companies has improved significantly overall. From the perspective of the number of complaints posted each month, the March 15 Consumer Rights Protection Day in March was a trigger point. The media's extensive attention and focus have played a role in promoting group-buying users to improve their awareness of rights protection. After March, the average monthly number of complaints from April to December exceeded 1,100, which is almost the same as the number of complaints in 2010. The highest number of complaints was in August with 1,316, December with 1,286, and July with 1,226.

From the annual trend, as the number of complaints soared after March, the complaint resolution rate declined significantly. This phenomenon cannot be simply understood as a decline in the service quality of group buying websites. In fact, most group buying websites have entered a cooling-off period in the second half of the year and have improved user experience. It can be seen from two aspects. One is that as mentioned above, the increase in consumer rights awareness has led to a rapid increase in complaints, and group buying websites are overwhelmed; another reason is that the overall environment has caused some large websites to have financial difficulties, service quality has declined, or some non-standard small and medium-sized websites have directly absconded with the money, and consumers' orders and complaints have become headless cases and cannot be resolved.

To summarize the hot spots of complaints throughout the year: refund issues, express delivery issues, and counterfeit goods issues are the most prominent. At the same time, a large number of group buying users were harmed by phishing websites in the first half of the year.

7. Top 10 Group Buying News Keywords in 2011

By reviewing the past news of Tuan800 Information Channel, we summarized the top ten keywords of group buying news in 2011, as shown in the following table.

Note:

"Refund after expiration" - Before and after March 15, various websites made various promises such as refunds for expired items in response to pressure from society;

"Funding fever" - the total amount of industry financing in the first half of the year reached hundreds of millions of dollars. It is rare in history that venture capital has entered a specific field of the Internet in such a dense manner;

"Layoff Wave" - ​​In the second half of the year, the group buying industry is entering a period of decline, venture capital is withdrawing, group buying websites are generally in financial difficulties, and layoff rumors are everywhere;

"IPO" in the US - In the fourth quarter, the rumor that Lashou would go public in the US was the first to start. Spokespersons of several group buying websites expressed their opinions on whether to go public, which triggered heated discussions in the media;

"Transformation" - Group buying websites in financial difficulties began to think about the problem of large investment and low output. Transformation became a consensus among everyone, and the purpose was also consistent - to explore the direction of sustainable development;

"Poaching" - a tragicomedy of grudges. At first, rumors of poaching by Groupon triggered a boycott by domestic peers. Eventually, as competition intensified, the phenomenon of poaching became more and more common. According to a survey, 60% of group buying company employees, especially middle and senior managers, have been harassed by headhunters. The most representative cases of the year were the collective job-hopping of employees in the Greater East China region of Lashou.com and the poaching of the Shanghai city manager of Meituan.com;

"Advertising war" - it should be said that the burning of money by group-buying websites began with the advertising war. From the end of 2010 to the first half of 2011, subways, Internet, Focus Media, TV and various outdoor advertisements in first-tier cities such as Beijing and Shanghai were bombarded by group-buying websites after financing. At the same time, advertising endorsements were also a hot topic. This war of burning money or being forced to burn money finally ended because venture capital withdrew in the second half of the year;

"Groupon" - 2011 was a year of transformation for Groupon, the originator of group buying. Despite the twists and turns in its listing, it finally successfully landed on the Nasdaq without any major problems;

"Juhuasuan" - An industry insider commented that no one expected that the invisible man after the war of thousands of groups would be Jack Ma. After fighting for more than a year, several first-tier group buying websites suddenly found themselves shrouded by a tall figure in the fourth quarter of 2011, which was Juhuasuan. On December 28, 2011, Juhuasuan, a group buying platform under Alibaba Group, announced its operating results in 2011: it has opened life service group buying in 41 cities through 170 operators, and maintained a high growth rate of 43% for 10 consecutive months, from zero to 180 million yuan in December. In 2011, the transaction volume of localized service cooperation alone reached 848 million yuan; if Juhuasuan's strong online shopping money-making ability from Taobao is also counted, then its group buying transaction volume has exceeded 10 billion yuan! This has to make group buying sites feel very stressed - group buying sites with simple business forms have fought for a year, and the total transaction volume is comparable to that of Juhuasuan alone. We expect that in 2012, complex group-buying platforms such as Juhuasuan and QQ Tuangou will become another tough player in China's group-buying arena, and they deserve more attention from the industry. Group-buying sites are about to face the headache that e-commerce companies once faced - "Should I insist on being independent or join Taobao Mall to open a flagship store?" We believe that, just like symbiosis and food chains in nature, perhaps competition and cooperation can coexist, and tigers and rabbits living in the same forest is the most realistic business portrayal.

"Wintering" - the argument that group buying is wintering has been overwhelming since the second half of the year, and group buying websites are anxious and busy preparing for wintering. Many websites have collapsed, as they were not planning to last long; many websites are still persisting, but do they really understand why they are persisting?

8. Outlook on the three major trends of group buying in 2012

◆From a simple group purchase model to a complex model such as "coupon/member marketing"

The development of group buying in 2011 not only brought benefits to consumers, but also allowed traditional merchants in cities across the country to witness the magic and innovation of the Internet. By the end of December 2011, there were 109 cities with monthly transaction volume exceeding one million. Group buying not only helps merchants quickly gather popularity and increase sales, but also includes subsequent marketing opportunities such as coupon certification and membership marketing. Merchants began to think, in addition to providing special packages with 20%-30% discounts to group buying stations, can they obtain more flexible space in gross profit margin and service cycle, such as 40%-70% discount packages? Can they conduct a secondary screening of group buying users, find a small number of high-value repeat customers among them, and incorporate them into their own membership marketing system? It can be said that group buying has created a solid user base, consumption habits, merchant resource reserves and consumption certification system for merchants' O2O marketing in 2011. With the popularization of smart phones and 3G mobile networks, the popularization and normalization of group buying will also accelerate the evolution of the O2O industry.

◆ Actively migrate from PC platform to mobile Internet platform

Although the group purchase model has solved the sales problems of some merchants, it is not enough to solve the users' demand for discounts anytime and anywhere. By the end of 2011, there were only a few group purchase websites that could really allow users to complete payment conveniently through their mobile phones. Walking out of the computer at home and following the user's whereabouts like a shadow to provide better recommendations will become a potential growth point for group purchase websites in 2012. It is understood that in addition to the original group purchase, group purchase giants such as Lashou.com have recently launched a special coupon channel to try to provide consumers and merchants with more diverse discount options, and they have also fully considered the usage scenarios under the mobile Internet. As industry leaders, their every move will trigger more group purchase websites to follow suit, and the local consumption platform model of "PC+group purchase" combined with "mobile Internet+coupon" may become a new round of popular trend for group purchase websites in 2012.

◆From a simple group buying platform to a standard tool for e-commerce marketing

While pushing forward the development of ground-based merchants, the concept of group buying has also brought about new changes in China. In 2011, many vertical group buying websites transformed themselves into B2C shopping malls, and many of the group buying giants also reaped great rewards in the physical product category. This is certainly the inevitable result of profit margin considerations in a competitive environment, but the evolution from group buying to e-commerce seems to be "unexpected but reasonable." For e-commerce companies that also struggled in 2011, in addition to distributing coupons on group buying sites to attract new customers, they also began to promote some promotional items through their own group buying channels. This seems to have become another "standard" tool for e-commerce marketing after flash sales. Will e-commerce companies also give back to group buying and expand life service content into the existing shopping mall structure? Let us wait and see.

Conclusion

Looking back at 2011, from being popular to growing again after jumping over the trough, China's group buying this year was a crazy roller coaster. 2011 was a truly complete year for China's O2O industry, and group buying also left a strong and colorful mark in the development history of China's O2O industry. While wishing large group buying sites to turn over a new leaf and start a new journey, those small and medium-sized group buying sites that once struggled to survive in this industry are equally worthy of respect. 2012 is definitely not the "doomsday" of the group buying industry. On the contrary, it will create more records to prove the value of its own existence. Various preferential consumption spaces under the mobile Internet will create more new business opportunities. The entire engine of life consumption has been started from the moment the group buying button is pressed, and the curtain of the new era of O2O is slowly opening.