What the Future Looks Like for Chinese LBS?
Ever since Foursquare made an overnight sensation at SXSW (South by Southwest) in last March in Austin, Texas, its siblings emerged upon the scene quickly in both U.S. and China with more or less similar features – check into where you are to announce your whereabouts. If Facebook is all about who am I, Twitter is all about what I’m talking about, then LBS service like Foursquare is trying to tell people where am I.
From Fifty to Fifteen
Two years after Foursquare’s SXSW debut show, the once heated LBS market now has showed signs of cooling down in both markets. Gowalla was acquired by Facebook and the service would be discontinued in next year. Whrrl was acquired by Groupon in this April. In China, Digu shed 70% of headcounts two months ago largely due to uncertain profitability prospect. Digu claims 20.8% of Chinese LBS market according to a report by Beijing-based market researcher AnalysysInternational. For last year there’re at least 50 LBS services in China market, while in this year only about 15 remained.
FoursquareのSXSWデビューショーから２年後、かつてヒートアップしていたLBS市場は今、両市場において減速の徴候を見せている。GowallaはFacebookによって買収され、サービスは来年停止される。Whrrlは今年の４月にGrouponによって買収され、Diguは不確実な利益の見込みのために２カ月後、頭数の７０％を減らした。北京を拠点とする市場調査会社AnalysysInternationalのレポートによると、Diguは中国のLBS市場の20.8％を獲得している。昨年、中国市場において少なくとも50のLBSがあった一方で、今年はたった15ほどが残った。
FoursquareがSXSWでデビューしてから2年、一度は盛り上がったLBSのマーケットは現在米国と中国の両方で落ち着きを見せ始めている。Gowalla はFacebookに買収され、来年中のサービス終了予定となっている。Whrrはこの4月にGrouponに買収されている。中国でも、Diguが、収益化の道筋を建てることができず、２カ月前に70%の人員を削減している。北京の市場調査会社AnalysysInternationalによれば、Diguは中国のLBS市場で20.8％のシェアを占めている。昨年中国には50のLBSサービスがあったが、今年度も残っているのはたった15である。
Digu co-founder Huang Xiaotao once said that “LBS in China is in a place that we need tocultivate the market and users, it’s too early to explore feasible business models.”
His remark mirrored in some of the largest Chinese LBS service providers’ shift in strategy.
LBS Plus Ecommerce
Jiepang, one of the leading LBS service which just launched its latest apps has been providing discounts and coupons for its users who check into local merchants, a move to not only facilitate check-in behavior among hardcore LBS early-adopters but also gain traction among regular smartphone users, they might not that interested in check-ins, but with coupon and discounts, why not. Shanda’s Qieke as well as Kaikai also give benefits to their users. Qieke CEO Liang Zhen said that “after a long-term effort of trial, we believed that the combination of LBS and ecommerce will be an ideal business model.” Liang expects RMB tens of millions revenue through what he called the LBS+O2O mix.
Industry experts once pointed out that there’re three types of LBS mix in China, which are LBS + social, LBS + games and LBS + ecommerce, while the first two are both bothered by glimmer revenue picture, LBS plus ecommerce without question would be a nature choices for them. Qieke announced lately that the company will be reducing its investments into the first two model whereas increasing money into the exploration of O2O.
As of Q3 of this year, there’re 18.3 million LBS users in China, up from the 10.5 million in Q2. By the end of Q4, the number would be 30 million, AnalysysInternation estimated. And after the group buying heat, people are more or less familiar with the idea of buying online and consuming offline. The market is maturing.
Look out for the Big Guys
Even though, these LBS service – if they step into the ecommerce forefront- would be seeing ferocious competition from some of the local giants like Dianping. The Chinese Yelp has long claimed itself as an ideal combination of “Yelp + Groupon + Foursquare”.
ビッグガイに注意する
とはいえ、これらのLBSサービス-もし彼らがEコマースの中心に踏み込むなら-はDianpingのようなローカル大手のいくつかとの競合が熾烈であろう。中国のYelpは長い間それじしんを「Yelp+Groupon+Foresquare」の理想のコンビネーションと主張している。
大企業の視点
LBSサービスがeコマースに参戦する場合、Diapningのような国内の大手企業は強大な競争相手となるであろうが、それでも、“Yelp + Groupon + Foursquare”.は長期に渡って理想的なコンビネーションの座を守ることになるだろう。
This maybe sound like a selling story for Wall Street, but none of these LBS services could afford to ignore Dianping’s move and determination in the market. Founded in 2003, Dianping now has indexed more than 1 million local merchants scattered in more than 2,000 Chinese cities. The site just raised more than US$ 100 million at a valuation of over 1 billion while the funding would go towards marketing, mobile businesses (such as check-in), and potential acquisition.
Except for the big one, those who just rise to the O2O market can also pose some challenge, especially some coupon-centric services.
However, Dennis Crowley, CEO of Foursquare disclosed in an interview this August that the site is about to break even through its persistent profitability expedition after started charging local merchants for once free local campaign service and real-time analytics tool. This could bode well for its Chinese counterpart that independent LBS service can still find its way and show its value to both users and merchants. Remember how Facebook Places lost its fight to Foursquare?
しかし、Foursquareの最高経営責任者Dennis Crowley氏は、8月に行われたインタビューで、当サイトは、現地の販売業者に対してローカルキャンペーンサービスとリアルタイム分析ツールを課金制とすることで持続性収益の特性を保ち、これをもっていよいよ損得のない水準に達する、と述べた。これは当サイトの中国における同業者にとっても良い兆候と言え、個人の位置情報サービスが自己の指針を見つけ出すことができるということ、またその価値をユーザーと業者双方に示すことができる。Facebook PlacesがFoursquareとの戦いに打ち負けたこと覚えているだろうか？
しかし、ForsquareのCEO Dennis Crowleyは今年8月のインタビューで、「地元業者による「初回無料キャンペーン」や、リアルタイム分析ツールへの課金といった継続的利益の探究の成果として、黒字化が間近である」と述べている。これは、中国の独立LBSも、その価値をユーザと地元業者の双方に提供できることを示唆しているのではないだろうか。Facebook PlacesがFoursquareに敗北したことは、記憶に新しい。
