What is group buying? | Cafe24 Newsroom

Group buying is an online shopping practice where several buyers band together and purchase a specific product in bulk for lower prices per ... Whatisgroupbuying? Feb26,2021 Groupbuyingisanonlineshoppingpracticewhereseveralbuyersbandtogetherandpurchaseaspecificproductinbulkforlowerpricesperperson. Acloserlookatgroupbuying Source:Gettyimagesbank Theconceptofgroupbuying–alsoknownascollectivebuyingorcommunitybuying–harnessesthepowerofbuyinginbulktobringdowneachitem’scost.Thise-commercepracticecreatesamutuallybeneficialagreementforallpartiesinvolved.Customersenjoyadiscountedpriceontheirpurchaseswhilemerchantsmovemanyproductsinasingletransactionandreducelast-miledeliverycosts. Inonlineshopping,collectivebuyingtypicallyhappensintwoways.Oneisthroughcasualorganization.Interestedpartiesgathertogetherandscheduleapurchaseforaproduct,whichadesignatedcommunityleaderfacilitates.Theseindividualsusuallycomefromthesamecommunities–physicallocationslikeneighborhoodsandapartmentsanddigitalspaceslikenicheorhobbygroupsandforums.Someinformalgroupsmayeventuallydevelopintoaconsortiumthatbrokersadealwithmerchantsforitsmembers’benefit. Thesecondmethodismoreorganized.Influencersorkeyopinionleaders(KOLs)usesocialmediaandotherplatformstogatherfollowerstopurchaseaproductenmasse,essentiallyorganizingagroup-buy.Influencerssellaproductinalimitedquantityorwithinaspecifiedsaleperiod,usuallywithdiscountedoffers. Groupbuyingontherise AmericancompanyGrouponwasamongthefirstonlinebusinessestousecollectivebuyingasabusinessmodelbackin2008.Itoffereddiscountedcouponsonactivities,goods,andservicesbasedongroupdeals.Thoughthebusinessmadewavesthen,groupbuyingquicklybecameanichefacetofe-commerce. However,inrecentyears,groupbuyinghasseenaresurgenceinChina–anuptakethat’snowripplingthroughoutAsia.Therapidriseofonlineshoppingandsocialcommercepavedthewayforitsnewfoundtraction.Since2018,communitybuyingrevenuehastripled,reaching13.6billiondollarsin2020.E-commerceplatformPinduoduo,abignameinChinaforcollectivebuying,builtareputationforsellingatlowpricesthroughgrouppurchases.Italsoencourageduserstorecruitothersinmoreeconomicalgroupdeals.ThedemandwasstrongenoughforPinduoduotoexpandandlaunchKuaituantuan,anewgroupbuyingplatformforlocalcommunities’groceriesanddailynecessities. CollectivebuyingisalsoquicklygainingsteaminSoutheastAsia(SEA),withshoppersshowinginterestinfoodandbeverage(F&B)products,importedgoods,andothernicheitems.China’smodelofcommunity-basedgroupbuyinghasbeengrowinginSingaporease-commerce’snewnormal.Localcommunityleaders,eitherontheirownorundertheemployofaconsortiumorcompany,organizepurchasesandmanagelast-miledelivery. E-commercestartupWeBuyisonebusinesscapitalizingonthegroupbuyingtrendinSEA.Fromitslaunchin2019,theplatformnowservesabout3,000group-buyleadersandover100,000shoppers.WeBuycaterstothreeSEAmarkets:itshomecountryofSingapore,Malaysia,andIndonesia.ThecompanyiseyeingfutureexpansionsinthePhilippinesandVietnam. Socialcommercefuelstheresurgenceofgroupbuying Crucialtotheriseofcollectivebuyingisitsstrongsocialaspect.CommunityleaderscoordinatepurchasesthroughmessagingappslikeWhatsAppandWeChat.OthergroupslikeGroupBuysSGtapFacebookandInstagramtosellproducts.Smalleronlinegroupssetupcollectivepurchasesfornicheorhobbyitemsthroughthesechannels.TherearealsoKOLswhoutilizelivestreamstoinfluenceconsumersintobuyinggoodsinbulk.Thesefrequentandinformalinteractionshelpforgeastrongerbondwithconsumers,goingbeyondaddingtocartandcheckingout.Withshoppersencouragedtoconvincetheirconnectionstojointhedeal,thecommunityasawholegrowsinnumberandclosertogether. Groupbuyingispoisedtobethenextlastinge-commercetrendinSEA.Theregionhasahighaverageof71%socialmediapenetrationrateacrosssixcountries.ThePhilippinesclaimsthetopspotfordailyinternetusage,whileThailand,Indonesia,andMalaysiaareamongthetop10mostactivecountriesonline.ThaiandFilipinousersareonlineforoverninehoursperday,whileIndonesianandMalaysianusersaccesstheinternetfornearlyeighthourseveryday.ThePhilippinesandIndonesiaarealsotwoofthemostactivecountriesonsocialmedia. Thecoronavirusoutbreakhasfurtherstrengthenedsocialcommerceanddigitalconsumptionintheregion.Theyear2020saw40millionnewinternetusersinSEA,ofwhich94%plantocontinueusingdigitalservicespost-pandemic.Customerbehaviorhasshiftedtowardsprioritizingessentialsandvalueoverluxuriesandbrandnames.Assuch,itbecomesmoreattractiveforcustomerstopatronizelowerpricesfromgroupbuys.Amidtheregion’salready-activeonlinepopulationandthesefactors,collectivebuyingwilllikelytakeoffandbeaninfluentialshoppingtrendamongSEA’sdigitalconsumersmovingforward. Cafe24’sappssupportgroupbuyingtrends Cafe24closelyfollowse-commercetrendsonsocialmediatodelivertop-notchsolutionstoitsmerchantsandpartners.GroupbuyingisalreadyapopularcommercemethodamongKoreaninfluencers.ThecompanyhasdevelopeddifferentappsthatcatertoDTCbrands’influencercommerceandgroupbuyingneeds. Cafe24’sSalesCalendarserviceisoptimizedforconductinggroup-buyingsalesevents.Merchantscaninputdetailslikepromodatesandproductquantityandtheservicewillhandletherest.Influencersthattestthee-commercewatersthroughgroupbuyingtendtobranchouttobuildtheirownbrandandselltheirownmerchandise.Cafe24helpswiththoseneedsaswellthroughitsDeliveryCommissionservice.Thisservicestreamlinesshippingproductswithprofessionallogisticspartnercompanies,regardlessoftheitems’quantity.BothappsareavailableontheCafe24Store. Cafe24continuestolistentothelatestcommercetrendsandtailoritsservicesaccordingly.Itremainscommittedtofast-trackingonlineentrepreneurs’growthandsuccessintheirtargetmarkets. 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