The heads of community group buying "make new calculations" and use membership to develop sideline business

With the release of Meituan's 2020 fourth quarter and full-year financial reports last week, the outside world once again saw the smoke and war in the group buying market.

Meituan’s net loss in the fourth quarter of 2020 was 1.

437 billion yuan.
The main reason for the increase in loss was the continuous investment in new businesses represented by community group buying.

From: Visual China

It can be seen that in the future, giants such as Ali, JD.

com, and Meituan will continue to increase their community group buying business, and community group buying will continue to be a battleground for military strategists.
The new round of "Hundred Regiment Wars" is bound to intensify.

However, just as the giants are spending a lot of money in the field of community group buying, some community leaders with "unique resources" are also making new calculations and starting their own "partial business".

Is it that the commission income from community group purchases can no longer satisfy these group leaders? Or did they smell some new "wind direction"?

1.

Take the initiative to find "partial business"

1.
Take the initiative to find "partial business"

"If you do it well, the monthly income of 10,000 yuan will not be a problem.

The best leader has a six-figure monthly income.
"

A senior BD (Business Development) of a community group buying platform told Understanding Notes that in the current mainstream community group buying platforms in the industry, the group leader’s income is basically composed of the sales commission of the area he is responsible for, and the core leader’s commission ratio is as high as 14%~16% , The commission rate of the general leader is also 8%~10%.

With the current trend of Internet giants spreading money frantically, community leaders in key areas often have 2% to 5% reward commissions.

It can be said that the more resourceful the leader, the more income.

So, what is the income of community leaders in Guangzhou, Shenzhen, Zhongshan and other places?

"Yuan Yi", a community leader in Zhongshan, told me to understand the notes, but the leader who is more diligent can basically make a monthly income of 10,000 yuan.

If the residents in the responsible community have strong consumption power, the monthly income can even easily reach 20,000 to 30,000.
However, such a high-income "work" is just a "side job" for her.

"The average salary in a small city is 3,700 yuan, and the group leader can easily collect and deliver orders in the community.

" Yuan Yi said that in the middle of last year, she was unemployed in the tourism industry, which coincided with the BD of several group buying platforms.
Develop a leader in her community.

As a result, "Yuan Yi", who was eager to solve the survival problem, became a Baoma leader, but when she opened the platform and understood the notes, she found that in the selection page of the nearby leader these days, the status displayed by Yuan Yi was actually "resting.

" ", temporarily unable to place an order.

"The new team leader opens the group almost every day, but I only do one, three, and five days a week, and rest at other times.

" As for the rest time, she said that there is more important "work" to be completed.
In the member group of community group buying, other products she represents and cooperated with are frequently released.

In addition to common maternal and child products, skin care products, weight-loss diet therapy, there are also kitchen supplies, cleaning agents, and even big-name fashion price reductions and treatment products.
The topics discussed in the group are basically not related to the group buying platform.
Anyway, there is a demand for fresh food group buying.
I just open the app and click to place an order.
I usually don’t bother to deal with it.
"

As for why Yuan Yi would put aside the essential work of the community leader and instead use the traffic established by group buying to start her own "partial" business, the answer is naturally profitable.

She told understand notes that as a community leader, her sales commission is only 14% (advanced group).
However, the commissions for selling other products that I have agency or cooperated with through the existing user base are basically 20%.
For some big-name clearance products, the commission is even as high as 30%.

In comparison, instead of spending more than ten yuan a single group purchase, she felt that it would be more cost-effective to push more high-value products.

"There are other group leaders around, and they have used existing members to start a micro business, and even sell insurance on behalf of them.
" Despite negligence, the community group buying business can still create more than 7,000 yuan in commission for her every month.
income.
As for the "small business", she generates nearly 10,000 yuan in income every month.

In the eyes of "Yuan Yi", those excellent team leaders with a monthly income of 20,000 to 30,000 yuan are exhausted almost every day, investing a lot of energy and time in expanding users and training new groups, and eventually they may become platform cannon fodder.
"Selling facial masks, maternal and child products, basically do not need to spend much effort, buyers will automatically find door-to-door cooperation.
"

She told understand notes that because community leaders have user resources and member groups, some companies and businesses will look for leaders to cooperate.
Using the traffic and membership resources owned by the group leader to sell related products, even if the high commission is given to the group leader, it will save money than investing in marketing.

So, if the group leader is doing a "partial" business and is not doing his job properly, doesn't his community's group buying platform ignore it?

2.
The platform cannot control the "expanded" head

2.
The platform cannot control the "expanded" head

“It’s very common for group leaders to use membership to develop their sideline business.
(Platforms) don’t care, but they can’t manage them.
” Zhou Li (pseudonym) was once an operation specialist of a local community group buying company in Shenzhen.
She believes that the reason why her company is in the fierce community group buying The main reason for the final fall in the war was that the community leader and store manager used platform traffic to develop their own so-called sideline business.

Like all community fresh food brands, the company has also taken measures to restrict it: for example, early cancellation and dismissal of group leader and store manager qualifications; later, by adding operators to enter the community WeChat group, actively participate in the management of the group.
It is hoped that this will prevent group leaders and store managers from taking advantage of the convenience of the group to release products other than the community group buying platform.

"But in the end I found that there was no use at all.
After all, in community group purchases, the group leader often meets with the members who placed the order.
" Zhou Li said that for members with official staff, the group leader generally does not release other products.
, But privately, the group leader often uses the convenience of picking up and delivering food to invite members to join their privately established communities.

She has even encountered such a situation: the official community of some group leaders has only more than 300 members, but they have created groups of four or five 500 people in private, and WeChat account has more than 4,000 member friends.
It's just that they are all used to develop "partial" businesses or engage in other sideline businesses.

"Once the group leader has strong membership resources, it doesn't matter whether he is a platform or not.
Of course, he is not afraid of the company's persuasion.
" Zhou Li revealed that because the measures are not effective for the group leader who is already sitting on traffic, the company has also begun to encourage the group by increasing the commission.
Chang focuses on the business of community group buying.

For example, setting relevant evaluation standards to allow high-quality community leaders to advance to achieve a higher commission ratio.
The commission settlement ratio of the most senior group leaders can even be increased to 18%.
However, some group leaders still go their own way.
For beauty micro-businesses, the commission ratio may exceed 20%, which is better than selling vegetables.
"

In the eyes of the group leader, the platform is a tool for attracting traffic and an endorsement of attracting users and establishing trust relationships.
Once the traffic of the platform's members and public domains is converted into their own private domain traffic, the group leader will start to act unscrupulously and arrogantly.
Start a sideline.

However, when these heads joined the platform, didn't they also pay the deposit?

Why would they be so confident, bypassing the platform, and developing "small businesses"? Zhou Li explained that at present, mainstream community group buying recruiting leaders usually require deposits ranging from several thousand to ten thousand yuan.
However, compared with the personal network resources established by the team leader using brand endorsement and platform traffic, it is a mere tens of thousands of yuan, which can be said to be nothing.

Based on the current effective customer acquisition cost of community group buying and fresh food e-commerce is about 20 yuan, the group leader only needs to use platform traffic and brand endorsement to establish a group of 500 people, which is equivalent to paying back.

The value and income that can be generated by the subsequent sideline and other commodity sales are even more immeasurable.
Therefore, when many heads of delegation join the community group buying, their motives are no longer simple.

Some community group purchases value the ability of high-quality group leaders to expand and build communities, but these group leaders often value brand endorsement and platform traffic.
What's more terrible is that there is actually no strong relationship between members and group buying platforms.

3.
A lot of "spending money" is difficult to change the loyalty of the head

3.
A lot of "spending money" is difficult to change the loyalty of the head

"Users (members) have no loyalty at all and only accept low prices.
" Talking about the relationship between the community group buying platform and members, A Ming, the small owner of a fruit shop near Huizhou Maidi, may have the most to say right.

At present, Amin has joined as the head of the "Ten Hui Group", and the fruit shop he manages is also a pick-up point for "Buy Duoduo".

He told Understanding Notes that before the introduction of the new "Nine Prohibition" rules for community group purchases, the platform desperately used huge discounts (burning money) to attract members to place orders and buy its fresh products.
However, as far as more consumers are concerned, which platform has a strong discount, they will go to which platform to squeeze their wool, and there is no user stickiness at all.

"After some comparisons, some members will place orders on two or three platforms to buy fresh meat and vegetables for promotion, just for the sake of a little bit cheaper than a dime.
" With the introduction of the new "Nine Prohibitions" regulations, called The low price war of community group buying has been stopped, and the current commodity prices of some platforms are only slightly lower than the traditional offline market.

Therefore, because the price lacks attractive advantages, many members have begun to return to the traditional market to buy fresh meat and vegetables.
From Amin’s point of view, the most intuitive feeling is that the number of consumers who place orders online and pick up goods at the store has been declining every day.
"The pick-up point is no better than Baoma and personal leader.
We have almost no way to maintain the relationship between members and customers.
.
"

As a "front wave" in the community group buying industry, Chen Yu, who once operated a fresh food e-commerce brand near an agricultural and sideline product wholesale market in Liwan District, Guangzhou, also pointed out that the key to the sustainable development of community group buying business lies in the ability of the group leader to maintain the community , Rather than blindly low prices.

"Like WeChat business, the group leader forms a strong relationship with members with a certain degree of trust through community maintenance.
" Chen Yu admitted frankly that once the community group buying platform has no price advantage, it often fails to attract members to place orders.
However, out of trust in the group leader, members usually also consider buying products recommended by the group leader.

Since the group leader has the ability to maintain the community and stimulate the desire of members to consume, recommend other products with higher commissions, develop sideline businesses, and start a "small business" is naturally a matter of course.
After all, the community leader is also profit-seeking.
Some community group buying platforms have begun to realize that the role of high-quality group leaders is far more important than substantial discounts.
Therefore, the action of "poaching the corner" of the high-quality delegation leader was also started.

However, once the community leader grows up, has members, traffic resources, and the ability to be good at maintaining the community, he will once again fall into the vicious circle of sideline development.
Compared with products such as cosmetics, weight loss, maternal and child, fresh food is more about volume, because the profit margin is not large, it is impossible to give the head of a higher commission.

Concluding remarks

Concluding remarks

After the "Hundred Regiments War", the community group buying platform will eventually return to the track of profitability and sustainable development.
Even Internet giants believe that it is impossible to "bleed" all the time to make a loss-making business.
Obviously, a group leader who blindly burns money at a low price and cultivates high-quality resources cannot forever build the competitive advantage of a community group buying platform.

Obviously, how to make the team leader loyal to the platform and let the team leader focus on maintaining and developing the community group buying membership is the key to the competition of the group buying platform, but this is also the biggest challenge all platforms face.

Source: Muzi

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