Ever heard of group purchase (团购 TuánGòu)? If you’ve been exposed to Chinese culture in the last couple of months, then I’m sure you have. Group purchase is a new way of buying things or services (online) and it’s in (很火 Hěn Huǒ – ‘very hot’).
The company that first introduced group purchase was 大众点评 (DàZhòng DiǎnPíng) ‘Crowd Review’. Established back in 2003 by a group of Shanghainese businessmen, this website claims to be the first – not just in China, but anywhere else around the world – to offer consumers an independent, third-party platform. Its users are allowed to share their experiences, leave reviews, post photos and even instructions on how to get there (it even offers advice on which buses and subway connections to take).
Nowadays, Dianping has expanded its service to include membership cards, reservations (O2O Online to Offline) and group purchase. All that and more contained in a single, neat and user-friendly app is what’s making Dianping so popular these days. Although originally Shanghai-oriented, Dianping now has its sub-sites in virtually any big (and by big I mean around 10 millions and up) city in China.
But, let’s go back to the subject of group purchase. Now, when I first heard the term, I thought that what it meant was that I should organize a couple of my buddies and together we would buy not one product, but ‘buy bulk’, thus getting a group discount. I was wrong, in China TuánGòu is a completely different kettle of fish.
Essentially, group purchase here means that a deal has been struck between a place of business and Dianping. In exchange for offering discounts and special promotions, Dianping offers to include their services (even showcase them) in their website or app. Group purchase comes in two forms: one is sort of like a coupon. For example, restaurant A will offer a 20% discount to all of those who book this set menu on this particular day. Or, a hair salon will offer a special discount for a cut’n’dye during a specific period.
The other type of group purchase is a special, promotional price of a service or product available only to a limited number of consumers. This type of group purchase is widely used in Taobao (淘宝 TáoBǎo) – the Chinese version of eBay – and what it means is that, for example, a relative of a factory owner buys 1000 purses at a lower price and then offers them to his/her customers via his Taobao web-store (网店 Wǎng Diàn).
Dianping has recently teamed up with the beloved WeChat to allow payments to be issued via WeChat’s My Bank Card service(我的银行卡 Wǒ De YínHáng Kǎ) making the payments even more convenient.