Lingtuan.com: 2011 China Online Group Buying Industry Annual Report

1. Foreword

The year 2011 was a year of rapid development and ups and downs for the group buying industry. Throughout history, no other industry has ever gathered such a powerful energy as group buying, attracted so many eyes and participants, swept every corner of social life from online to offline, and carved out a brand new Internet landscape.

The domestic group buying market has evolved from a "thousand-group war" at the beginning of the year to a massive "ten-thousand-group war" in the middle of the year. Everything has its limits, and the group buying industry, which has been shrouded in negative media, has begun a brutal reshuffle and integration in the second half of the year.

According to the 2011 National Group Buying Website Census Data Bulletin released by Lingtuan.com, by the end of 2011, there were 5,877 group buying websites in the country, but the number of websites in operation had dropped from a peak of 5,188 in July to 3,909 at the end of the year. A total of 1,968 group buying websites across the country have closed down and exited the group buying market amid fierce competition, accounting for 33.5% of the total number of all operating group buying websites.

On the one hand, the wave of "thousands of group purchases going bankrupt" continues to spread, while on the other hand, the group purchase transaction volume continues to rise, repeatedly setting new records. The group purchase market is showing a phenomenon of ice and fire. In December 2011, the monthly transaction volume in China set a new record of 3.5 billion yuan. In 2011, the total transaction volume of group purchases in China was as high as 21.632 billion yuan, and it also helped consumers save 28.2 billion yuan to resist the high CPI. In contrast, according to statistics from Yipit, a North American group purchase navigation website, the market size of the North American group purchase industry in November was 267 million US dollars, equivalent to 1.682 billion yuan, which has been surpassed by the Chinese group purchase army.

It is worth noting that Juhuasuan contributed 10.035 billion yuan of group buying transaction share to China's group buying market, and its transaction volume of 2.039 billion yuan in December accounted for 58.3% of the national group buying market. Yipit data shows that the gross revenue of Groupon, the originator of group buying websites , in November 2011 was 154 million US dollars, equivalent to 970 million yuan. In less than two years since its launch, Juhuasuan has surpassed Groupon in terms of transaction scale and innovative model, establishing its position as the global group buying industry leader.

Whether it is industry insiders or media people, they are full of interest and confusion in the face of such a huge group buying paradox. As China's earliest group buying navigation website and authoritative data statistics center, Lingtuan.com collects massive data from the national group buying industry in detail and conducts professional processing and statistical research, striving to use objective, fair and detailed data analysis to reveal the overall development trend of China's group buying market in 2011 and the future group buying industry structure.

II. Summary of the top ten events in the group buying industry in 2011

To deeply understand China's group buying in 2011 , we must know the ten major events that have affected China's group buying industry. As China's most authoritative group buying navigation and group buying data statistics center, we believe that the following ten major events have affected the annual trend of the group buying industry in 2011 and determined the new starting point in 2012 :

1. Groupon enters China

At the beginning of the year, the news that Groupon, the originator of group buying websites, joined hands with Tencent, a domestic Internet giant, to enter China was like a heavy bomb, which immediately brought the already fierce competition of thousands of group buying websites into a white-hot stage. Faced with the legendary strong attack of Groupon , the anxious leading camp of domestic group buying websites even formed an alliance to resist Groupon 's entry into China. In order to defend the inherent position and seize the market, the leading domestic group buying websites took the lead in launching advertising offensives, which greatly raised the promotion costs. The legendary hybrid Groupon China (Gaopeng.com) was launched belatedly on February 28, 2011. After repeated heavy losses, Gaopeng.com failed to enter the top ten rankings of Chinese group buying websites in 2011. However, the high promotion costs of group buying websites laid the groundwork for the group buying reshuffle that began in the middle of the year.

2. Group purchase financing

The group buying scene in 2010 was so glorious and the valuation was so high that no one of the top 10 group buying websites was willing to be controlled by Groupon . Independent financing to expand the market and IPO became the common idea of ​​the top 10 leaders. In order to resist Groupon's entry into China and be the first to land on NASDAQ , Lashou.com completed a C round of financing of US$ 111 million in April 2011. Together with the previous two rounds of financing, Lashou.com's three rounds of financing totaled US$ 166 million ; in July 2011 , Meituan completed a B round of financing of US$ 50 million, with Alibaba becoming the largest shareholder, and the third round of financing is currently underway; in addition, a total of 21 group buying websites have completed a total of approximately US$ 450 million to US$ 500 million in financing.

3. Group buying costs money

With huge amounts of financing, group-buying websites began an all-round advertising war. In addition to subway, bus, TV ads, building ads, and outdoor ads, group-buying websites began an endorsement war:

( 1 ) In February 2011 , Tuanbao.com spent tens of millions of yuan to hire three celebrities, Peter Ho, Qin Lan and Yu Na, as its spokespersons, becoming the first group-buying website in China to be endorsed by celebrities.

( 2 ) In April , 58.com invited Yang Mi to endorse "a magical website"; the cosmetics group buying website Jumei announced that it had signed Han Geng as its spokesperson;

( 3 ) On May 10 , group-buying website Lashou.com announced that actor Ge You would be its image spokesperson;

( 4 ) On June 28 , Manzuo.com announced Doraemon as its spokesperson. It is reported that Manzuo.com spent tens of millions of dollars to sign Doraemon .

4. Group purchase of demolition

In May , a news report about 200 employees from Lashou.com's East China region collectively "eloped" to Wowotuan caused the group buying alliance formed to resist Groupon's entry into China to fall apart. In response to the rumor of poaching, Xu Maodong said: "Two or three employees coming to Wowotuan can be called poaching, but if two or three hundred people come, it is not poaching, it should be called " demolition. " " Subsequently, news about Wowotuan's acquisition of $ 200 million in financing and the launch of an IPO appeared in the newspapers. Many people in the industry regarded this "elopement" and the rumor of Wowotuan's financing and listing as a carefully planned hype. The "group buying demolition" incident shifted the focus of group buying from foreign wars to internal wars.

5. Thousands of groups closed down

The escalating group buying war has caused the survival of domestic group buying websites to deteriorate rapidly. The simple model that could have made quick profits has made the group buying websites that received financing lose money to gain publicity, causing the industry's gross profit margin to drop rapidly. Coupled with the continuous increase in promotion costs, the capital chain of large group buying websites is tight, and they have to lay off employees and withdraw from the website. Small and medium-sized group buying websites have closed down. The October "National Group Buying Website Census Data Bulletin" released by Lingtuan.com used the term "thousands of group buying websites closed down" for the first time to describe the high incidence of group buying website closures in September , and group buying financing has entered a winter.

6. Group buying transformation

Realizing that the entry barrier of the group-buying model is high, the pioneers with high operating barriers have begun to try to transform. Unable to bear the homogeneous competition of many cosmetics group-buying websites with the same model, Jumei Youpin took the lead in transforming into a B2C mall. On August 29 , Facebook, a world-renowned social networking service website, announced that it would close its group-buying business Daily Deals . The domestic social networking website Kaixin.com announced that from October , its Kaixin group-buying products and customer service would be outsourced to the group-buying website Ftuan , and the cooperation period between the two parties would be one year. Lashou.com and Wowotuan.com have successively transformed into group-buying malls and started to charge merchants for listing fees. The " 2011 National Group-buying Website Census Data Bulletin" of Lingtuan.com shows that although many previous group-buying websites are still in operation, they have already switched to the group-buying field. From the analysis of the page content, the direction of the switch is as follows: mall, website navigation, rebate website, community, education website, clothing customization website, Taobao store, corporate website, life service website, movie website, computer website, etc.

7. Groupon goes public

On November 4, 2011 , Groupon successfully listed on NASDAQ. However, looking back on its listing journey, it can be said that it was full of twists and turns. Since Groupon first started its IPO application in June 2011 , it has submitted IPO applications three times and disclosed financial reports twice. After it disclosed a large amount of operating data and financial status, it was questioned in many ways. Groupon successfully listed amid doubts, but its stock price fell below the issue price again, causing investors to question the group buying market. Groupon is a weathervane for global group buying websites. Its operating status and stock price fluctuations have concerned the global group buying industry and investors.

8. Lashou.com’s IPO was shelved

Just as Groupon was going public, the domestic group buying website Lashou.com also submitted an IPO application. Originally scheduled to go public in the United States on November 14 , Lashou.com failed to go public on the Nasdaq due to internal and external difficulties. The overseas listing of China's first group buying website has temporarily failed. Even if Lashou.com could have gone public at that time, its financing scale had already announced the floating losses of its C- round investors. This incident directly announced the arrival of the extreme cold of domestic group buying financing, the capital bubble of group buying burst, and the valuation and value began to return to rationality. Affected by it, many of the top ten group buying websites once again laid off employees and branches, and negative news occurred frequently during this period, affecting the overall image of the group buying industry.

9. Group buying supervision

At the end of 2011 , the Ministry of Commerce issued the "Notice on Doing a Good Job in Online Retailing during the New Year's Day and Spring Festival". After that, the State Administration for Industry and Commerce held a symposium for e-commerce website managers. Then, the industrial and commercial administration departments in Chengdu and other cities issued implementation opinions on strengthening the supervision and management of group-buying websites. Special rectification activities for online transactions including group buying are about to be launched. There is a fierce debate on whether to set a capital threshold for group-buying websites, but there is no doubt that all citizens agree that severely punishing fraudulent activities in the name of group buying and increasing the penalties for non-compliance with the spirit of the contract need to be implemented by government regulatory departments first.

3. Important data of the group buying industry in 2011

1. Statistics on the number of group buying websites in China in 2011

According to the 2011 National Group Buying Website Census Data Bulletin released by Lingtuan.com, there were 2,612 group buying websites launched nationwide in 2010, and 3,265 more in 2011, bringing the total number of group buying websites to 5,877.

The number of group buying websites far exceeds the capacity of the growing group buying market, so 2011 became a year of reshuffle and integration in the group buying industry, with many group buying websites exiting the market. The number of group buying websites operating at the same time reached a peak of 5,188 in July 2011. Since August, the number of group buying websites has begun to decline month by month, and in September, the phenomenon of "thousands of group buying websites closing down" appeared.

By the end of 2011, 1,968 group-buying websites had closed down or exited the group-buying market amid fierce competition, accounting for 33.5% of the total number of operating group-buying websites. Only 3,909 operating group-buying websites welcomed the arrival of 2012.

(II) Statistics on national group buying transaction volume in 2011

In 2011, the transaction volume of group buying in China reached 21.632 billion yuan, while this figure was only 2.5 billion yuan in 2010, a huge increase of 765% from the previous month. The compound growth rate for the whole year of 2011 was 19.7%. The main driving force for the growth of group buying in China came from Juhuasuan, which was spun off from Taobao in October 2011 and operated independently. Its group buying transaction volume in 2011 reached 10.035 billion yuan. The rest of the group buying websites in China contributed 11.596 billion yuan in transaction volume.

In the last month of 2011, as group buying websites stepped up their promotion efforts during the Christmas and New Year peak seasons, the monthly group buying transaction volume in China hit a new record of 3.5 billion yuan. Among them, Juhuasuan's monthly transaction volume exceeded 2 billion yuan to 2.039 billion yuan. Among the other 1,500 group buying websites reviewed and included by Lingtuan.com, the monthly total transaction volume of 300 group buying websites collected by index data also hit a new record of 1.458 billion yuan.

For comparison, the US group buying navigation website Yipit's statistics on the US group buying transaction volume in November were US$267 million, equivalent to RMB 1.682 billion.

Groupon , the originator of group buying websites, had a transaction volume of US$ 154 million in November , equivalent to RMB 970 million.

Chinese group buying websites as a whole have surpassed their North American counterparts, and China's group buying leader Juhuasuan has also surpassed North American group buying leader Groupon to become the new overlord of the world's group buying industry.

(III) Statistical trend of the number of group buying periods launched by Chinese group buying websites in 2011

       The trend of the number of group purchases in 2011 was in line with expectations. At the beginning of the year, with the escalation of the war of thousands of groups, the number of group purchase websites increased sharply, and the index of the number of group purchase product group purchases rose and reached a peak in the middle of the year. Subsequently, with the beginning of the reshuffle, the layoffs and withdrawal of group purchase websites, and the closure of small and medium-sized group purchase websites, it showed a downward trend. After a four-month bottom shock from August to November, the traditional sales peak season in December ushered in a surge in the number of group purchases, easily breaking through the small peak set in the middle of the year, setting a new high of 259,400. In order to welcome the sales peak season, many group purchase websites that had been closed earlier also revived in November and December to join the New Year's group purchase war.

(IV) Statistics on the number of people purchasing in the national group buying market in 2011

From the above chart, we can see that the peak of group buying among netizens occurred in December 2011. The “New Year’s Goods Group Buying” of Juhuasuan greatly boosted the popularity of group buying, and the transaction volume of the group buying industry in December also hit a new high of 3.5 billion yuan. Among them, Juhuasuan set a world record of a staggering single-day transaction volume of 282 million yuan.

The group buying industry witnessed another small peak in April 2011, but since many group buying websites at that time mainly attracted attention with very low discounts and unit prices, group buying websites did not have outstanding performance in sales. Eight months later, group buying has matured enough, with 72.68 million people participating in the group, bringing the transaction volume in December to 3.5 billion yuan. We are happy to see that the group buying industry has developed steadily in the process of gradually consolidating its foundation. The purchase of more than 508 million people in 2011 is the best proof.

(V) 2011 National Group Buying Market Sales Statistics by Category

As can be seen from the above figure, service group buying accounted for 72% of the transaction volume in 2011. Among them, catering and food are the most popular among netizens, ranking first in the list of life service group buying with a market share of 29%. Leisure and entertainment, travel hotels and beauty and health care also performed well. Group buying opened the door to O2O. In the second year of the rise of group buying, service group buying can have such a good performance. We have to face up to the value that the group buying industry brings to society: stimulating domestic demand and promoting consumption. Group buying in 2012 will provide greater support to the national economy.

(VI) Trend chart of the proportion of group purchases of daily life services in China in 2011

The above chart shows the transaction volume of life service products in 2011, including the Juhuasuan group buying platform. The decline in the proportion of services in Q4 is because physical group buying gradually dominates the sales peak season at the end of the year. However, the absolute value of service group buying is also increasing.

7. Comparison of group buying services and physical group buying sales in the national group buying market in 2011

The above chart shows the ratio of service group purchases to physical group purchases in the group purchase industry throughout the year.

8. Number of Chinese group buying websites in major cities in 2011

The top ten most popular cities for group buying in China were determined in the statistical ranking of "the number of group buying websites distributed in major cities in China in 2011". According to the ranking of the number of local group buying websites and local branches of national comprehensive group buying websites, the cities with the most concentrated group buying websites are: Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, Hangzhou, Chengdu, Xi'an, Nanjing, and Wuhan.

From the number of group buying websites in various cities, it can be seen that first-tier cities are heavily guarded positions for group buying websites, and important second-tier cities are also a battleground for group buying websites.

9. Top 20 Cities for Group Buying Sales in China in 2011

This statistic only includes the sales of local service group purchases in each city. From the figure, we can see that the rankings of Beijing, Shanghai and Guangzhou have not changed, but the gap between Beijing and Shanghai has been greatly reduced. In the second half of the year, the group purchase market for local services in Shanghai has been booming. The sales of local services in Shanghai of many of the top ten group purchase websites, including Juhuasuan, Meituan, Lashou.com and Dianping.com, have exceeded their local service sales in the Beijing market.

The rise of the local service group buying market in Shanghai is related to the fact that Shanghai merchants have a stronger sense of service and pay more attention to service quality. This is a revelation to the city's merchants. Only by being honest and working together with merchants to improve the quality of after-sales service can the group buying industry remain evergreen.

10. The top 15 group buying websites in China in 2011

From the ranking of Chinese group buying websites, it can be seen that Juhuasuan, the leader of Chinese group buying, stands out, followed by Lashou, Meituan, Wowotuan, Manzuo, 58tuangou, QQtuangou, Dianping, Nuomi, 24quan, Ftuan, Tuanbao, Didatuan, Gaopeng and Juqi.

The top 15 group buying websites account for nearly 95% of the country's transaction volume, and the "Matthew effect" is evident.

This statistic does not include group buying websites and B2C shopping malls’ group buying channels that focus solely on group buying of physical cosmetics.

11. Statistical analysis of traffic rankings of the top ten independent group-buying websites in China in 2011

The rationality of the transaction volume data of the group buying industry in 2011 compiled by Lingtuan.com can be indirectly confirmed by the Alexa ranking of the top ten independent group buying websites in the country in 2011 .

Lashou.com, which ranked second in terms of transaction volume in 2011 , has been surpassed by Meituan, which ranked third in terms of transaction volume. The position of the leader of independent group buying websites has changed hands since Q4 2011. However, since Lashou.com's transaction volume was higher than Meituan's before Q3 , Lashou.com still ranked second in terms of transaction volume in 2011 with 1.75 billion yuan, surpassing Meituan.com. Meituan.com's transaction volume in December was the first to exceed 250 million yuan, making it the first independent group buying website in terms of monthly transaction volume. However, since it only started to lead in Q4 , Meituan.com's total transaction volume for the whole year could only rank third with 1.466 billion yuan.

Compared with the sales reported by various group buying websites, the statistical results of Lingtuan.com may be smaller, mainly because we have run a de-fake and de-duplication algorithm for the possible duplication of group buying number and products. We believe that each group buying website included in the statistics has the ability to exceed the transaction amount obtained by this statistical algorithm, or generate additional non-transaction sales income. (Lashou.com's annual sales may exceed 2 billion yuan, Meituan.com's transaction amount may also reach 1.5 billion yuan, and Manzuo.com may also reach the 1 billion yuan mark.) However, in order to make the report fair and objective, we still insist on a unified algorithm. Thanks to the group buying websites that provided us with their own data for verification.

As can be seen from the figure, the peak traffic rankings of most group buying websites occurred in the middle of June and July, and then there was a downward trend in the reshuffle process. In contrast, Meituan.com, Nuomi.com and Didatuan.com showed relatively stable trends.

Although 58tuangou has not activated its own domain name, its performance has been steadily increasing, breaking the RMB 100 million mark in December . Its gross profit margin is continuously rising. It is expected that some of the top ten group buying websites will start to make profits in Q3 , Q4 , or even Q2 of 2012 .

(XII) Changes in transaction volume of Juhuasuan, the leader in group buying, in 2011

The leader of every industry deserves in-depth analysis. The group buying industry is no exception. Juhuasuan went online on March 21 last year, and the transaction volume on the first day was only 3,012 yuan. However, on December 13, 2011 , the New Year's group buying set a single-day group buying transaction record of 282 million yuan. Juhuasuan, which has long been the number one in the national group buying industry in terms of transaction volume, no longer aims to be the number one, but to become the leader of the group buying industry, and this leader should also be global.

Juhuasuan tried many creative group purchases last year, such as "dismantling" the British Pavilion at the World Expo. Juhuasuan's concept is quality, fashion, and fun. In mid- 2011 , a designer channel called D2C was launched, allowing designers to rush to the front and face consumers directly. The first attempt achieved good results, with a turnover of more than 400,000 yuan in less than a day. This event has attracted great attention from the designer industry. Once successful, it may become a new model to leverage the industry. "If this model can really be implemented, we can imagine that students from the Fashion Department of the China Academy of Art can compete and audition with their own designs, and the sellers behind us will become organizations with supply chains at the back end, and group buying will become a place to gather demand and group premiums. For example, a certain travel route is decided by consumers voting. "According to Yan Limin, general manager of Juhuasuan, Juhuasuan will focus more on gathering demand and let suppliers realize consumers' ideas in the opposite way.

From D2C to C2B , Juhuasuan is trying various innovations, not just for Juhuasuan, but for the entire group buying industry. Juhuasuan has realized the group buying 3.0 model advocated by Wang Qiheng, CEO of Lingtuan.com last year. The connection between Juhuasuan's group buying and the upstream supply chain may benefit thousands of group buying websites and hundreds of thousands of merchants across the country, and help the society to rationally allocate production resources, reduce waste, and increase the happiness of sharing and customization.

Juhuasuan has currently included more than 170 group-buying websites and partners on its platform, and has launched in more than 30 cities. The goal for 2012 is to expand the platform to 100 cities and complete the unprecedented cross-industry group-buying 3.0 platform.

(XIII) 2011 Juhuasuan Local Service Group Buying Transaction Volume Cities Ranking

Analyzing Juhuasuan's local service sales in various cities, we found that Shanghai, the most fashionable city, topped the list with 150 million yuan in transaction volume, and Hangzhou, the home base, surpassed the capital Beijing and jumped to second place. While we marvel at Juhuasuan's local service, we also guess that Juhuasuan will definitely not be content with Beijing, the city with the strongest Internet awareness, being ranked third forever. In 2012 , Juhuasuan will definitely use the integration of group buying 3.0 to radiate its "ju" power to more important cities and a wider population.

14. Ranking of cities with the largest number of group buying merchants in 2011

The above chart shows the ranking of the number of group buying merchants by city in 2011. There is no doubt that Beijing, as the birthplace of group buying websites nationwide, is the most pioneering Internet model, and Beijing merchants are also the most willing to use the emerging group buying model to promote sales and brand building. Beijing, Shanghai and Guangzhou occupy the top three, and the more novel discovery in the ranking is the inverted ratio of the number of merchants in Zhengzhou and Shenzhen. Although Zhengzhou's overall group buying sales are not as good as Shenzhen, in the development of group buying merchants, the local group buying website in Zhengzhou and the Zhengzhou branch of the national group buying website have obviously spared no effort to sweep the streets and enlighten merchants, and use local media to positively guide the penetration of the group buying industry from online to offline merchants, paving the way for O2O .

15. Number of repeat group purchases by group buying merchants nationwide in 2011

The ratio of the number of times Chinese group-buying merchants participated in group-buying in 2011 tells us that more than half of the domestic merchants will choose to return and cooperate with group-buying websites again, and more than 10% of the merchants have cooperated with group-buying websites three times.

This is completely different from the situation in the North American group buying industry. On January 4, 2012 , a survey report released by Susquehanna Financial and group buying aggregation website Yipit showed that among the nearly 400 merchants surveyed, although 80% of the respondents said they were satisfied with group buying companies, about 52% said they did not plan to provide group buying transactions in the next six months. The survey was designed to determine the value of group buying services and what concerns companies using such services have. The survey directly caused Groupon 's stock price to plummet by 9% that day and fell below the issue price again.

       The different attitudes of Chinese and North American merchants towards group buying stem from the commission ratio of the group buying industry. In North America, Groupon 's gross profit margin is as high as 40-50 % , while the gross profit margin of the domestic group buying industry is generally less than 10% . The reshuffle and integration since the second half of 2011 has prompted group buying websites to return to rationality, and the phenomenon of losing money to gain publicity has been curbed. The industry's gross profit has rebounded, but it has not exceeded the average gross profit margin of 15% when group buying first entered China.

       Obviously, the low gross profit of China's group buying industry has stimulated the desire of Chinese merchants to participate in group buying again and again. This is very beneficial to the popularization of group buying, but at the same time, the low gross profit has put pressure on the cash flow of group buying websites, which is not conducive to the business development of group buying websites. As the industry reshuffle proceeds, the gross profit will further increase and dynamically balance the interests of group buying websites and merchants.

4. Development prospects of the group buying industry in 2012

       After the frenzy in 2010 and the tempering in 2011 , the group buying industry has become more rational and mature. The false fire of high valuations has gradually faded, but due to the flaws in China's social credit system, the de-bubble process is accompanied by overwhelming negativity, which has caused the new thing of group buying to suffer an unjust accusation and its value has begun to be underestimated.

       There are two things that must be solved for the development of Chinese group buying: the first is the issue of integrity, and the second is a fine division of labor and cooperation system to avoid vicious competition. The first is a problem for all group buying websites and merchants, and even the whole society; the second is how to reasonably allocate social resources to avoid vicious competition. Both of these issues require a long-term process of resolution in a broad social sense.

Juhuasuan's innovative tightly coupled group buying 3.0 model provides a platform that can greatly improve the group buying industry environment in the short term. The payment and credit system built by Taobao over the years just provides the best support system for Juhuasuan's group buying platform.

Who knows when the river water warms up in spring? On December 28, 2011 , Juhuasuan, the group buying platform under Alibaba Group, as the leader of group buying in China, officially announced its 2012 open strategy. The core of the strategy is to fully open up Juhuasuan's tens of millions of active users, 12 million daily independent visit traffic, 600 million loans from Alibaba Group's Ali Finance and 600 million funds from the venture capital alliance.

More fundamentally speaking, Juhuasuan focuses on the healthy development of the group buying industry. It uses the payment and integrity system that Taobao has built over the past seven years to construct a group buying platform that is open to the industry, allowing group buying networks fighting in the red ocean to find a harbor in the blue ocean. This allows each affiliated group buying network to leverage the advantages of its local resources and promote socialized fine division of labor and cooperation.

Yan Limin, general manager of Juhuasuan, a leader in Chinese group buying, said that while everyone is predicting the decline of group buying and most people think that group buying has already encountered winter, we are seeing the arrival of spring. So we believe that the choice of opening up is a natural process. We can no longer develop alone. This is the best time to open up.

This is good news for group buying websites that have offline resources and operational strength but are experiencing a capital winter. Joining Juhuasuan will gain free traffic and the capital support that operations desperately need. Juhuasuan can efficiently implement the standardization of group buying products and services through a tightly coupled integrity platform. Juhuasuan's tightly coupled group buying 3.0 model is an innovative breakthrough of Groupon's group buying 2.0 model, and will play a decisive role in China's future group buying development pattern.

Wang Qiheng, CEO of Lingtuan.com, said: "The group buying industry in 2011 has experienced a roller coaster-like development. The reason why it has such an impact of ups and downs is that group buying has touched the connection nerve between online and offline, and for the first time opened up the two O's of O2O. If you use one word to describe group buying in 2010 , the word is "crazy"; if you use one word to describe group buying in 2011 , the word is "chaos"; if you use one word to describe group buying in 2012 , the word will be "order". Group buying needs to open up the O2O of Online to Offline, and it is a necessary process to go from chaos to order."