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What is China’s Community Group Buying Trend & How Does it Work?

Kruthika Vadhera 12th March 2021
China's Community Group Buying Trend - Yelo

There’s been a lot of talk about the Community Group Buying Trend in the Chinese markets. The reason being – convenience and efficiency it provides to both sellers and buyers. Moreover, it is also time saving and economical. But what is it exactly? 

What is Community Group Buying? 

The latest trend to disrupt the traditional markets of China is the group buying trend. As the group buying trend is growing, its impact is becoming visible in the market. 

It involves consumers, sometimes entire communities, coordinating their orders to receive a discount by purchasing in bulk. This trend is further being facilitated by e-commerce platforms like Pinduoduo, Meituan, and Didi. 

During the pandemic, group buying saw a boost that’s likely to last, as this model centres around online groceries. It also provides retailers with the opportunity to clear inventory. 

Benefits of Community Group Buying:

Here are a few benefits of group buying. 

  • Removes retailers and wholesalers from the scene
  • Savings of logistics cost. 
  • Supplements traditional e-commerce. 
  • Speedy process. 
  • Cost-effective

Are you wondering how this model works exactly? Let’s get into it.

How Does Community Group Buying Work? 

The purchasers who mostly belong to tier two and tier three cities of China, where most buyers are price-sensitive, purchase directly from the suppliers. They do so by eliminating wholesale markets and retailers from the process. 

What’s interesting is that group-buying platforms have their respective mini-programs on WeChat. Customers use these to place their order efficiently. 

Mostly, a self-designated leader is responsible for creating and maintaining a WeChat group and signing up locals from their region. The member limit for each group is 500.

Group leaders post about product selection in the group, either daily or weekly. Interestingly, these products aren’t only limited to groceries. They also include other life essentials like tissue papers. 

Residents are only required to pay when their collective demand surpasses a delegated value. After the residents have placed their order, the complete order gets delivered in bulk the next day at a designated point from where the group leader picks it up. 

The leader then unpacks and organises the resident’s orders. It’s upon the residents to either come and pick up the order themselves or get them delivered to their doorstep via leader. 

But what happens if there’s an issue? In such cases, the residents must contact their group leader, who acts as a mediator and convey the problems to the suppliers. In addition to that, he’s also responsible for finding a viable solution on behalf of the residents. 

What’s in it for the group leader, then? Group leaders are liable to a 10% commission from the community members for their service.   

Is Community Group Buying the Same as Running a Hyperlocal Online Grocery Marketplace? 

At the core of it, group buying and a hyperlocal online grocery marketplace are similar business models. Both of them cater to the needs of individuals in a defined geographical area. 

The hyperlocal services market is estimated to register a CAGR of 17.9% from 2021 to 2027. 

But setting up such marketplaces can be a challenge in itself. Yelo, a viable solution, allows you to create a multi-vendor marketplace without any setup fees. You can launch a marketplace within a day without the coding trouble. 

This platform comes inbuilt with themes engines, using which you can personalise your grocery marketplace and enrich the user experience. 

How to Launch an Online Grocery Marketplace to Sell Groceries Online

1. Decide the Delivery Area

First and foremost, you need to decide the delivery areas you’d cater to. You can do so by understanding the social preferences and initial response to online grocery shopping of individuals residing in those areas.  

2. Choose an E-commerce Platform 

A vital act to set up an online local grocery business is creating an e-commerce website. You can easily do so using Yelo. Moreover, Yelo allows you to create a personalised app that makes it simple to manage orders online. 

Not only would it save your overall costs but time as well. It’s excessively effortless to set up your own grocery marketplace with Yelo and have things moving. 

In addition to that, they also provide their customers with the option of wallets and cards for secured payments. 

3. Setting and Listing Inventory 

Any grocery business’ soul is inventory. If you’re looking to attract customers to buy grocery online, you must have a diverse range of products to offer. And for that, you’d require a reliable inventory management tool. 

Yelo lets you update your inventory with the products and quantity available. They also notify you when your products are about to expire or go out of stock. But the best part is that you do all this using a single dashboard. 

4. Searching for a Delivery System 

An online grocery marketplace business is connected to the customers via delivery services. That’s why you must choose a reliable one as it can make or break your relationships with customers. 

It’s vital to choose a delivery service that’s prompt in the region where you operate. 

And remember that your customers must be able to receive live updates of their order and notifications via text. 

Yelo can give you an edge over others in this context. Not only do they provide real-time tracking and updates but route optimisation for drivers as well. 

5. Market Your Marketplace 

If you want to make your online grocery selling business successful, it’s vital to market it well. Your target audience must feel your business’ presence online. 

On-page and off-page SEO is a tried and tested technique that you can use. Using offline marketing techniques like distributing pamphlets and flyers in your local area also helps. 

When you’d be opening up, make sure to offer discounts and special offers to attract more customers. Yelo lets you analyse sales reports by permitting you to pick and choose the KPIs (Key Performance Indicators) that matter and generate automated reports that you can use for marketing. 

6. Be Active on Social Media 

To nail the online grocery marketplace game, having a social media presence is a must. It’ll help you display your products virtually and offer discounts. These days brands are also interacting with the customers on social media. 

Not only does it help in catering to a specific audience but also in better understanding of their psychology. 

Yelo integrates with your social media platforms to help you interact with your customers and lets you measure performance on different platforms. 

Benefits of Launching an Online Grocery Marketplace with Yelo 

Here are a few benefits of launching an online grocery marketplace with Yelo. 
Click here to understand How to Start your Own
Grocery Marketplace
.

1. Multiple Payment Options 

Customers look for various payment options when it comes to payment. And Yelo easily integrates with several payment getaways to allow your customers the flexibility to pay through multiple cards and online wallets securely. 

It’s reliable and lets you update payment-related offers more easily. 

2. Easy Online Order Management 

Every online local grocery business is looking to save time. Using Yelo, you can accept, reject, and track all your online grocery orders and deliveries efficiently. 

Customers can easily search for groceries as per their requirement and filter as per their convenience. Moreover, you can also enable/disable outlet locations. 

3. Facilitates Customer Management  

For any business, it’s vital to keep the customers happy. Using a single dashboard, Yelo lets you view reviews and ratings given by the customers and the option to respond to their queries. 

For that, Yelo allows you to view their order history and setup payment integration.

4. Auto Assigning of Deliveries and Route Optimisation

By using the geo-location of delivery agents, Yelo auto-assigns delivery tasks to them on their app. It also provides agents with route optimisation that allows them to reach the customer’s destination on time. 

5. Mobile Responsive Themes 

Using Yelo, you can find the perfect theme for your online grocery marketplace. These are customisable and mobile responsive. As these themes are designed professionally to enrich the user experience, they’d be ideal for your business. 

Conclusion 

Group buying trend in China has disrupted the traditional markets. The reason for this is multifold. 

It saves logistics costs, speeds up the buying process, and enhances the shopping experience of customers. Such a model immensely benefits both sellers and buyers. 

The online grocery marketplace system is not much different. These models’ popularity is increasing significantly, as consumers receive their products in a short time and with much ease. 

And because they offer a lot of opportunities for entrepreneurs, more and more individuals are adopting it. 

So if you’re a businessman looking to start an online local grocery business, Yelo is what you need. It’d provide you with mobile responsive themes, facilitate customer management, and enable route optimisation for the delivery agents. 

Moreover, your customers will be able to post reviews and easily track their deliveries while allowing you to monitor performance analytics from a single dashboard.  

Sign up for Yelo’s free trial and launch your Online Marketplace within no time.

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