In the late autumn of 2011, the group-buying industry, which had experienced more than a year of rapid development, entered a period of pain: many websites began to "sacrifice pawns to save the chariot" by laying off employees and closing stations after recklessly burning money and blindly expanding. News of broken capital chains were everywhere. Compared with those group-buying websites that hastily changed their business strategies and took it one step at a time, Meituan.com stood out as extraordinary. Its consistently upheld values of "consumers first, merchants second, Meituan third", and its technology-driven rather than people-intensive development model brought about a refreshing change in the group-buying industry. According to the latest published report by Tuangou800, "China's Group Buying Market Statistical Report for October 2011", Meituan.com ranked first among all group-buying websites nationwide with sales of 173 million yuan. The latest data shows that Meituan.com’s sales in November have already surpassed 200 million yuan. In contrast to other group-buying websites whose sales data fluctuate unpredictably, Meituan.com has always maintained a stable growth rate.
Focused on Local Services Instead of Selling Goods
Perhaps careful consumers would notice that the group-buying deals listed on Meituan.com are quite different from others. Most deals on Meituan.com are related to dining, entertainment, and other life services. There are very few physical goods that require logistics delivery. This is a significant difference between Meituan.com and other group-buying websites, with the proportion of physical goods strictly controlled below 10%.
Currently, there are mainly two types of group-buying websites: physical goods and local life services. Physical goods involve consumers paying online and waiting for courier delivery, suitable for homebodies; the latter involves consumers purchasing services like dining, haircuts, KTV, etc., online and then enjoying these services offline, encouraging them to get out of the house.
Consumers First, Not Scale First
Localized life services are natural consumer demands, and most of the consumers' eating, drinking, and entertainment needs are met within their local circles. When fulfilling this need, consumers tend to enjoy better services at the most favorable prices, which is an instinctive reaction of individuals in an economic society. Group-buying perfectly meets this natural need and instinctive demand of consumers.
Therefore, Meituan.com created many "firsts" in serving consumers: the first to launch a post-consumption evaluation system, tracking consumers via SMS to request evaluations of services; the first to establish a large call center equipped with a complete set of Avaya equipment and 300 seats; the first to introduce expiration reminders via SMS, not pocketing unspent goods; the first to offer unconditional refunds for expired deals, initially considered disruptive to the industry but later became a standard service feature adopted by other group-buying websites; the first to make backend data publicly available, promising never to falsify industry data.
Technology-Driven, Not People-Intensive Tactics
"Using technology to transform traditional service industries," was Wang Xing's original intention behind starting group-buying. He believed that group-buying should use the Internet to change small and medium-sized businesses in traditional service industries.
To achieve this, the technical department of Meituan.com developed many IT systems to help merchants improve service efficiency. Meanwhile, Meituan.com also considered how to meet various needs of merchants and consumers through technological upgrades. Previously, merchants had to endure long waits to receive payment, but Meituan.com solved the back-end capital chain needs of merchants by setting up automatic payments through a self-developed computer automation program, making Meituan.com the fastest-paying group-buying website.
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