Community Group Purchase Documentary of the Battle of Hunan: Meituan, Didi, and Pinduoduo besiege Prosperous Base Camp

In just 180 days, the “red-orange-yellow battle” of community group buying moved the main battlefield from Hubei to Hunan like a tacit understanding. As the first and most prosperous and preferred home base for developing community group buying business in China, Hunan’s community group buying market instantly entered a state of chaos due to the entry of giants. Didi’s community e-commerce platform Orange Heart Optimal, fired the first shot.

Community Group Purchase Documentary of the Battle of Hunan: Meituan, Didi, and Pinduoduo besiege Prosperous Base Camp 1

“It feels like overnight, the supermarkets near the community put up orange promotional posters.” Zhou Tong, a citizen of Hunan Province, discovered that after November, there were suddenly many promotional posters of Orange Hearts in the surrounding communities. Not only Orange Heart, Meituan Optimal and Pinduoduo’s Duoduo Maicai also posted their own posters all over the streets.

In order to compete for the Changsha market, Orange Heart Optimal and Duoduomai chose to open positions on November 6 and launch their business. Meituan Optimal began investigating Changsha in May, and finally chose to enter the formal operation stage on November 11.

Although it has not yet been launched in Hengyang City, Meituan Optimal posters have already been posted all over the entrances of local supermarkets and convenience stores. The Times Weekly reporter learned that Meituan originally planned to launch Meituan Optimal in Hengyang on November 13, but due to lack of preparation, the business launch was finally postponed to after November 20.

The supply chain of the Hunan local community group buying platform first smelled the smell of gunpowder on the eve of the war.

“Pingduoduo, Meituan and Orange Heart Optimum came to Hunan this time with the unanimous goal of attacking Prosperity Optimum and winning the first place in the market.” According to a purchaser from a local small and medium-sized community group buying platform in Changsha, “Xingsheng Optimum aims to keep more than 300 of its own The core suppliers held a small meeting for this group of people in early November, which increased the rebate by about 2%. Prior to this, Xingsheng Optoelectronics had never had a relevant reward mechanism. Now all platforms are wooing these core suppliers, and some suppliers Dare to flourish and dare not stand too obvious.”

Faced with the golden arena where Xingsheng Optimum has been entrenched for two years, Meituan, Didi and Pinduoduo did not make this decision hastily. After occupying the market in more than 20 major provinces such as Hubei, Guangzhou, Jiangxi and Shandong, Duoduomaicai and Meituan Xianyou have deployed troops from various places to form a leadership team, led by key figures on each platform.

The Times Weekly reporter learned exclusively that Abu (the head of the operation of Pinduoduo Mall), the project leader of Pinduoduo’s “Duoduoduo” project, frequently went to Hunan Province. The former Hubei province Duoduomaicai No. 1 is handsome (flower name, Pinduoduo first-level supervisor) 1) Later, he will be responsible for the main battlefield in Changsha. An insider of Pinduoduo revealed that Yingjun was the core member of Pinhaohuo in the early days.

At the same time, Chen Liang, the head of the Meituan Optimal Business Unit, one of the core founding team members of Meituan and a member of the highest management decision-making body S-team, is directly responsible for the jurisdiction of Hunan Province; Liu Zicheng, the president of Orange Heart Optimal, also led a large number of headquarters a week ago The person in charge of each business line went to Hunan to participate in the start-up meeting of Orange Heart. In addition to this time, Liu Zicheng also participated in the start-up meeting in Hubei Province.

In the face of the challenges initiated by the three major Internet giants, a middle-level executive from Prosperity Optimum said bluntly, “This battle is unavoidable, and we also expected that the final result may be that each company divides the market.”

An insider close to Prosperity Optimal revealed that Hunan Prosperity Optimal’s GMV this year can reach 40 billion yuan, and the scale cannot be underestimated. It has become a competitor that Didi, Meituan and Pinduoduo cannot ignore.

“Outsiders” approaching the city

The Hunan community group buying war started in November this year. The change in capacity distribution closely related to community group buying may be the earliest sign.

Entering November, the originally deserted Changsha Second Ring Road suddenly became lively, and there was a bizarre phenomenon of “cargo pulling” in the urban area: the cargo transportation capacity within the second ring road was almost quickly drawn by half, and second The number of vans with the “cargo pull” logo outside the ring suddenly increased, and they were concentrated in three places: Wanwei Yuhua District Logistics Park, Kaifu District Xiangjiang North Road, and Wangcheng Baowan Logistics Park in Wangcheng District.

“Outside the second ring road belongs to the suburbs in the suburbs. We generally do not go to this place.” said a Changsha citizen.

As a member of this group of truck drivers, Wang Li can’t remember how many times he ran to the three logistics parks and how many trucks he pulled. Through the chat and communication of the staff in Okura, he learned that the multiple Wanping warehouses of these three logistics parks were contracted by Duoduomai, Meituan Optimal and Didi’s Orange Heart Optimal respectively. The standard products and fresh products sent by him and his colleagues to these three platforms are sorted and distributed by the warehouse management personnel, and then sent to the grid stations in the second ring road or the hands of major group leaders, and finally appear in Changsha At the table of city citizens.

Freight drivers like Wang Li, as the constituents of transportation resources, directly run through various scenarios, categories, and entire formats. Therefore, only by achieving a balance between capacity and demand can the final implementation of closed-loop trading be promoted. Transport resources have become the focus of the platform’s open struggle.

Many Changsha suppliers stated that on the day when Meituan Changsha went online on November 11, Orange Heart prefers to directly adopt the heavy subsidy method of “no matter how much freight drivers deliver on that day, as long as they deliver to the warehouse, there will be a monetary reward”. Most of the drivers were gone, causing the opponent’s capacity to be very tight.

Competing for capacity is competing for arrival time. The logistics system directly determines the delegation leader’s performance rate and affects the delegation leader’s willingness to promote-which platform has a mature logistics system, a higher performance rate, and an earlier delivery time, which platform will be the first to gain the trust of the local delegation leader.

Hunan is the region with the most mature community group buying model and the longest application time. A reporter from Times Weekly found that the leader of Xingsheng Optimal Group also had extremely high performance requirements and bargaining power on the platform.

Many leaders of Changsha Prosperity Group said that although the SKUs (stock keeping units) of Dodobuy are relatively small, they are usually delivered to the pick-up point at 7 o’clock in the morning (before the promised time is 16:00), which is the earliest arrival. Goods platform.

This may be related to the delivery model of Duoduo Food.

An insider close to Duoduomai said that after the opening of Changsha and Hengyang, Duoduomai mainly adopts a full-direct distribution with a three-level distribution model of Dacang-grid station-self-pickup point, and orders close to Dacang The goods will be sent directly from the warehouse to the pick-up point. Generally, they will be out of the warehouse at 2 a.m. and will be delivered to the head of the group at 6 a.m. In addition, the greatly compressed delivery time is the core factor.

“One word, ruthless”. Liu Wei, the supplier who supplies Duoduomai and Orange Heart, clearly feels that Duoduomai is different from the high performance requirements of other platforms. “Duodumai has very strict control over the storage time, and the standard products must be at 5 pm Some peers were fined 2,000 yuan for overtime for half an hour before entering the warehouse. Other platforms have not formulated overtime penalties. Duoduobu has never implemented such regulations in other provinces.” Not only that, “Fresh products are mislabeled Fines too.”

The delivery time actually involves a series of B-end business links such as market operation capability, logistics system, category procurement and channel management, which greatly tests the front-end and back-end cooperation capabilities of each platform. Especially facing the special position of Hunan, various platforms are also imitating each other in competition and re-adjusting their strategies.

The Times Weekly reporter learned exclusively that all the local promotion teams that had opened Wuhan Kaicheng for Duoduomai also came to Hunan collectively with the Duoduomai team, and adopted the method of hiring and instructing local part-time local promotion in less than two weeks. , Increasing Changsha delegation heads to more than 6,000, including a large number of prosperous heads, and the speed of group expansion far exceeded that of Wuhan at that time (more than 8,000 delegations a month).

In order to get started quickly, Meituan Optimal Group’s strategy for head expansion in Hunan has also been re-adjusted, adopting self-operated BD positions + outsourcing BD positions to rapidly expand the team.

The Times Weekly reporter learned that outsourcing BD receives remuneration based on a base salary plus performance. In addition, to develop an effective leader (receiving 5 orders within 7 days) additional rewards ranging from 50 yuan to 100 yuan, one month to develop 100 effective leader will be given 10,000 yuan.

According to an insider close to Meituan, the total number of BDs in Meituan Optimum Hunan has exceeded 1,500, and Meituan’s internal planning is at least 2,500, and the number of personnel deployed far exceeds the previous main battlefield in Wuhan.

“Compared to other platforms, Meituan’s self-operated BD has always accounted for the largest proportion, and Didi’s self-operated BD accounts for about 10%.” The above-mentioned insider close to Meituan said, “A city manager of Meituan is in charge of at least 10 Each BDM is responsible for managing more than 10 self-operated BDs. Therefore, the number of self-operated BDs in each city can generally reach more than 100 people. Meituan prefers to have at least 10,000 self-operated BDs nationwide.”

“According to Meituan’s internal planning, the self-operated BD will be transferred to an operating position in the later period.” The insider said.

An internal Meituan employee explained to a reporter from Times Weekly, “The huge self-operated BD team is in line with Meituan’s tonality. Back then, Meituan was dominated by direct sales, supplemented by franchisees in some cities. The way is to sweep the streets and open the city. Because in the early stage of business development, the use of direct sales can allow employees to go to the front line to understand the operational rules of the battlefield and business, ensure that they are unified, and improve execution efficiency.”

The Prosperous Defense of Hunan

Recently, near the headquarters of Xingsheng Optimality on Qingshan Road, Yuelu District, Changsha City, a job advertisement for Duoduobuying was impressively posted: Xingsheng Optimal first-line general workers will receive a monthly salary increase of RMB 500-800 per month, and employees of supervisors and above will receive a monthly salary increase. Increase of 30%-50%.

An internal employee of Xingsheng Optimal told Times Weekly that since June, major companies such as Meituan and Pinduoduo have hired people with three or four times higher salaries, and Xingsheng Optimal has lost a considerable part of its talents. What makes the management even more troublesome is that the strategic location of the big Internet companies has created a sense of crisis among the employees of the company.

Since the beginning of November, the community group buying business of various Internet companies has been launched in Changsha. They have launched various regional drainage programs such as App opening posters and inviting newcomers to subsidize. Among them, Didi has the largest subsidy.

An Orange Heart Optimal Hunan supplier revealed that as early as the trial operation stage in early November, Orange Heart Optimal decided to launch a subsidy of US$100 million after the official launch on November 18. According to a public report by the vertical media Cayman 4000, Orange Heart Changsha preferred three types of subsidies, including category subsidies, discounts and rebates, and incentives for group leaders to place orders on the 18th. The final daily order volume exceeded 1.7 million orders.

Faced with the siege of Internet giants, what is the chance of success by buying the top companies from the community of the couch family?

Unlike Didi, Meituan, Pinduoduo and other latecomers, Xingsheng Optimum failed to try the front store and back warehouse, distribution station, one-hour delivery and other models. Finally, in 2017, the community group buying model was determined and used its Hunan chain Convenience store brand “Furong Xingsheng”‘s supply chain and the advantages of store self-pickup points are rapidly increasing. According to public reports, at present, Xingsheng Optimal Business covers 13 provinces, 161 prefecture-level cities, 938 counties and cities, 4777 townships and 31405 villages, with an average daily order of 8 million orders nationwide.

“The key success factors for community group buying are the front-end team leader, the intermediate supply chain and the end logistics. In Changsha, Internet giants are temporarily no match for Xingsheng Optimum in these three aspects.” Community group buying senior practitioner Weber analyzed to a reporter from Times Weekly.

“On the team leader’s side, Xingsheng Optimal has a five-level system of leader-specialist-supervisor-manager-director. The more orders, the greater the success of earning lower-level sales. Marketing supervisors, market managers and marketing directors serve as Xingsheng preferred teams. The core of the company has special support policies such as 2000 yuan, 5000 yuan and 7000 yuan basic salary respectively. The maximum salary of the marketing director can reach 130,000 yuan. Therefore, based on this management system, the prosperous and preferred leader with massive resources will do both. The head of the Internet platform, but will not defect at will.” Weber pointed out.

(Proportional drawing of Xingsheng preferred group leader)

(Proportional drawing of Xingsheng preferred group leader)

“Almost all the people in Hunan have the experience of ordering and buying food in Xingsheng Optimal, and the after-sales service of their products is very good. For the problematic goods, the leader of Xingsheng directly pays the compensation first, so the relationship between the neighboring street and the leader is They are all better.” Even if he knew about the three “new entrants” of Meituan Chosen, Duoduo Mai Cai and Orange Heart Chosen for a long time, Zhou Tong did not approve it very much. Links, the head of the group is not active in the group, so if the price is not much different, he will still choose to prosper.”

“Xingsheng Optimal is the only player whose logistics system extends to the village at present, and it is also the next day. Duoduobuying can only sink to the township at present.” Chen Kai (pseudonym), a former employee of Duoduobuying, said frankly, “Xingsheng Optimal It has a self-built logistics system that links upstream suppliers through the platform, and then uses its own logistics team to transport products to five-level service outlets in provinces, cities, districts, counties, towns, and villages.”

Liu Huiyu, the co-founder of Xingsheng Optoelectronics, once publicly declared that “In Hunan, almost every township, town, and village can buy things through Xingsheng Optoelectronics. Place an order at 11 o’clock tonight, and the goods will arrive at 11 o’clock tomorrow morning.”

“Xingsheng has a strong appeal in Hunan. After Duoduobuying, Meituan Optimal and Orange Heart Optimal were opened in Hunan, the progress of group expansion and investment promotion was actually not smooth.” A member of Meituan Optimal Changsha The employees reluctantly said, “Xingsheng’s core suppliers generally have a very good relationship with procurement, and they generally reject other platforms.”

The Times Weekly reporter found that as of November 20, in the progress of opening the city, Meituan opened the three cities of Changsha, Yueyang and Zhuzhou, and Duoduomai opened the two cities of Changsha and Hengyang. Orange Heart preferred to open Changsha. City, Hengyang City, Yueyang City, Changde City, Yiyang City and Zhuzhou City.

“Meituan Optimal Open City is very slow, and Duoduo Shopping, who has consistently occupied the market with a high-speed open city, is also slowing down like the Hunan market. The reason behind it is really worth investigating. On the contrary, Orange Heart Optimal is rapidly increasing.” Analysis of Cao Wei (pseudonym), a veteran of the Changsha community group buying industry.

Why do giants value positional warfare

Community group buying has become a strategic project for Internet giants.

According to incomplete statistics from Times Weekly reporters, as of November 20, Meituan Optimal has now opened services in 24 provinces (municipalities or autonomous regions) and 189 cities, and the scale of Duoduomai is even better, and the scope of services is covered. There are 25 provinces (municipalities or autonomous regions) and 178 cities. According to Tech Planet, on October 20, Meituan opened services in only 20 cities, and now it has surpassed the speed of Dodo Shopping.

(As of November 20, shopping for food to open cities)

(As of November 20, shopping for food to open cities)

(As of November 20th, Meituan selects cities to open) Compilation by Times Weekly reporter

(As of November 20th, Meituan selects cities to open) Compilation by Times Weekly reporter

An internal employee close to the top level of Pinduoduo revealed that Duoduo Maicai and Meituan Optimal regard each other as their main competitors and compete against the national daily order target.

The Times Weekly reporter learned exclusively that Pinduoduo’s internal senior executives first set a target of 10 million orders per day across the country, and Meituan immediately formulated the same plan. Due to the continuous increase in the number of the other party, it has now increased the data to 20 million orders. According to incomplete statistics, as of now, the average daily order volume of Meituan and Pinduoduo has exceeded 7 million.

Didi, as the only player who has no retail genes among the giants in the game, also expressed a clear intention to compete for group buying in the community. In an internal meeting in November, it called out “there is no upper limit on investment, and we must win the market.” slogan.

Why did the three Internet giants storm the community group buying market?

Didi, the first entrant who focuses on the travel business, not only wants to prove its strength to the capital market through community group buying of new businesses, but also has the purpose of trying to strengthen industry barriers through new businesses.

After six years of food delivery wars, Meituan has now secured a 70% share of the food delivery market, mainly covering young people. However, as the scale grows, the growth space that food delivery brings to Meituan has gradually been restricted.

In 2019, Meituan’s revenue growth rate was 38.9% year-on-year. By the second quarter of this year, revenue growth rate had dropped to 16.9%. Meituan has always regarded fresh food and offline scenes as its basic market, and community group buying may be its best and last opportunity to enter the e-commerce and fresh food field-through Meituan’s selection of the main sinking market and facing first-tier cities The “two legs” of Meituan’s grocery shopping can accurately reach new users with high consumption potential such as housewives, middle-aged and elderly people, and channel them to the App.

While Pinduoduo, which uses agricultural products as one of its business features, faced the fact that Meituan and Didi shared their own traffic through community group purchases, they were eventually “forced” to fight.

“In the long run, there are many advantages in the main online traffic. If it passes through the middle of the public resource leader, it will eventually happen that the platform shares the traffic pool. If Meituan makes efforts in the later stage, it will do a good job in the leader operation through offline teams. Work will turn Pinduoduo, Didi, and Ali users into users of the group leader. In the end, there is a high probability that Meituan will seize the initiative.” Cao Wei believes.

“It’s certain that the regional and fresh SKU-based community group buying is only a rudimentary form. After the leader’s guidance and education have allowed users to form stable e-commerce consumption habits, the role of the leader may be cancelled later. Directly use the influence of the platform to expand the e-commerce business, forming an e-commerce model similar to that of daily next day delivery.” Cao Wei said.

From Didi’s opening of the first city to the present, the community group buying resurgence has lasted for about 180 days. The intensity of the melee can also be felt by observing various front-end applets.

Comparing the software portals of several giants, Duoduobuying’s small program interface is simple in design, and the cost of user information capture is low, but the product search function is missing. Meituan prefers to reduce the high return flow cost caused by users canceling orders at will , Revise again, and hand over the permission of “Cancel Order” to the team leader and back-end customer service. Compared with the other two platform pages that directly display the opened city addresses, Orange Heart prefers to use search and positioning to find self-pickup points.

What’s more noteworthy is that Meituan, Pinduoduo, and Didi have very different ways of counting their sales. Taking Red Bull as an example, Duoduo Maicai and Meituan Optimal both use 1 box (24 bottles) as one piece of sales, while Orange Heart Optimal chooses to split. One bottle is counted as one piece and sold separately. . Calculated in this way, if the same box of Red Bull is sold, the optimal sales volume of Orange Heart will be 24 times that of Pinduoduo and Meituan, and there are many other products that are sold separately.

Community Group Purchase Documentary of the Battle of Hunan: Meituan, Didi, and Pinduoduo besiege Prosperous Base Camp 2

(The top is for buying more vegetables, the bottom is for orange hearts)

(The top is for buying more vegetables, the bottom is for orange hearts)

From the collapse of group buying platforms in small and medium-sized communities to the merger of Baotuan two years ago, the community group buying industry has undergone a round of reshuffle.

To continue to maintain the status of the largest player in this track, prosperity and selection may need to fight to the death. The above-mentioned insiders close to Xingsheng Optimal revealed that Xingsheng Optimal decision-making tiers are beginning to be more inclined to deepen in the existing market, putting forward the slogan “Death to life, user experience”, try to build a moat with a better experience, and plan Gradually transform the expanded users of major factories into their own users.

In the future, there will be a long-term coexistence of multiple players in the community e-commerce field. The Times Weekly reporter was informed that Shihui Group has recently received a new round of US$200 million financing from Ali, and the Taobao App traffic port will be connected with Shihui Group. A former employee of the community group buying platform “You Me You” revealed that Tongcheng Life is discussing mergers and acquisitions with ByteDance also began to test the waters in Shandong.

From the perspective of industry insiders, with the continuous opening of the market for community group buying and the influx of more giants, the model will continue to evolve, and the future may pose challenges to traditional e-commerce businesses represented by Ali and