Why the investment storm in group buying net

April 2010 with the Spring Thunder flashing, China's internet industry has a magnificent 12-class hurricane Wave. Group buying network to the great http://www.aliyun.com/zixun/aggregation/17725.html "> Price advantage, suddenly become the new favorite of netizens, media focus, business channels." "Group purchase" of the popular power to promote China's electrical business into a new peak, the bustling market scene attracted many angels and VC, investors face the financing requirements of group buying is always the green light, generosity, look to the "buy" field of investment and financing prospects of flowers, such as spring.

However, although the beauty of the blooming is too short. Domestic and foreign capital to enter the heavy, stimulating the countless new group buying Web site from the stampede. As of July 1, 2010, the domestic group buys the website industry to reach 347, by August 2010, buys the website to surpass 1000. But group buying of the investment and financing market not only with the increase of group buying has become more prosperous, but suddenly recession, many investment institutions are completely on the sidelines, no longer enthusiastic entry. The instant reversal of the situation, so many group buy net from the prospect of optimism into hard support. The group buying and financing feast seems to have ended hastily without a start.

The author's deep view of the market pattern, business model, investor attitude, found that the cause of group buying network investment and financing, a total of three points:

First, the development of too fierce not in line with market law

"Group buy" site is too sudden and too surprising, everything is too fast and crazy, the internet and netizens do not seem to understand the "buy", "buy" has been a fire every IP address. In just a few months, handle nets, "24 coupons", reunion nets, 5151 group buy nets, cool group network, such as dozens of group buy sites have been the angel, VC huge investment, group purchase net overall financing limit of more than billions of yuan.

But after a few months, the rapid rise of the group buying network market is beyond the market expectations, the profit model of full profit, seriously homogeneous commodity channels, condemnation after-sales service, without the threshold of the loss of competition, making many capital prohibitive. Start to stay on the sidelines, free from the group buying market. Group buying network investment and financing pattern, from the investors take money to find a project, into a group buying site with a thick business plan, looking around for Angels and VC, for and need to change the role of the full peak shoes. By October 2010, when the state announced the establishment of a group buying network "authorization mechanism", investors more cautious, the overall investment and financing situation of Chinese group buying network became very uncertain.

Second, the pattern is not clear to meet business needs

Group buying mode in the early years to attract a large number of investment institutions, the important reason is that its strong price advantage attracted netizens crazy pursuit of cash flow to achieve a rapid cycle. Also by the domestic media to give the "myth" as the evaluation, become China's E-commerce "emerging model", inexplicable cover on the MO falsely have a profit halo. But once the market test found that the huge cash flow is not a profit, but a loss. Because the face of peer bidding, internet users, the price of logistics, group buying network of small profit margins quickly become a model.

And strictly speaking, "group purchase" can only be called as a form of electricity, not a sustainable competitive advantage of the "emerging model", but not "the inevitable product of China's e-commerce." Once the "myth" of the window paper was punctured, it immediately felt uninteresting. Group buying, which attracts users with a price war, is far less able to buy than the active members of the Business-to-consumer. The weakness of purchasing ability, also inevitably leads to the weakening of the overall profit model of the website. Group buying site for a time there is no new breakthrough point, can only be in the types of goods and brands work hard, forming a closed doors, the embarrassing situation. The capital institution is not a charitable organization, in the case of unprofitable, of course, will choose to wait or exit, this is human nature.

Iii. pattern confusion does not meet investment requirements

Capital institutions value not only short-term benefits when investing in projects. More emphasis on the project in the maintenance of long-term strategic income on the basis of the market competition environment is stable and orderly. Group buying site after a few months of fission, according to its strength, direction, merchandise, publicity, the different crowd, the emergence of a line of Web sites, second-line sites and vertical site competition pattern. And the three, is completely irregular competition. Although the overall strength and influence of the first-line group buying site is greater than the second-line group buying sites and vertical sites. But the homogeneity of the commodity, the degree of Internet users, so that the market competition in the group buying site, is a total dispute. Basic products are: catering, beauty body, massage, foot road, spa, board games, bars, KTV, performance tickets, outdoor travel, cosmetics and so on. Although it seems to include a wide range, there is enough market space. But in fact, due to the increasingly fierce competition, the category homogeneity of serious.

Website targeted and selected businesses, service providers, manufacturers, reached more than 70% overlap. Take the current popular "buy tickets" for example, Beijing area of large and small cinemas, smaller theater prices are indeed much cheaper. But is located in the remote, the environment simple, the effect is general. Although save money, but not achieve the effect, can not meet the needs of white-collar and fashion crowd. So gradually all stared at the "Wanda", "UME" and other large cinemas. The result is of course also very obvious, the site of group buying more and more, equal to "force" the cinema rises the group purchase price.

Disorderly competition in the market, price competition, homogeneous competition, the market is bound to be a mess, coupled with some bad site malicious fraud, so many media and netizens also began to buy the net "suspicious", which also deepened the investor's nervousness and prudence.

The root cause of the period is not because of State policy intervention, but because the domestic group buying market itself development strategy and profit model is not clear enough, on the market entry barriers low, commodity resources, channel management immature, too many web site blindly follow, impulse followed the market pattern chaos. Finally led to group buying network investment and financing pattern of the short-lived.