The Gold Rush Mentality
Local news broke last week that 360buy is looking to outsource its group buying business while 55Tuan appears to be one of the bidders as the two were rumored to be in discussion about the possibility.
Now It’s 360buy’s Turn
The 360buy move followed 55Tuan’s taking over of Ganji group buying business two weeks ago. And Ftuan has already been taking care of kaixin001’s daily deal sites since last year. More and more Internet companies who jumped into the group buying arena now after second thought were considering closing down or outsourcing their group buying ventures. We’re expecting to see more similar deals in the near future.
先週地元のニュースが報じたところでは、360buy が共同購買事業をアウトソースしようとしており、55Tuan がそれに手を挙げた中の1社で、この2社はその可能性について協議に入っているとの噂だ。
次は 360buy の番だ
2週間前、Ganji の共同購買事業を 55Tuan が引き取った後、360buy が動いた。Ftuan は既に kaixin001 の日替わりキャンペーンサイトの面倒を見ている。この領域に次々に飛び込んだインターネット企業は、今はみな考え直し、共同購買ベンチャーを閉じるかアウトソースすることを検討している。我々は近い将来、同様のディールがさらに出てくると見ている。
360buyが購買部門の外部委託を検討している、と地元紙に先週報じられたが、その可能性を協議していると噂される55Tuanが入札者のひとつとして浮上している。
今や360buyのターンだ
360buyの動きは、二週間前の55Tuanによるガンジーグループ購買部門の引き継ぎに続いている。そしてFtuanは昨年からすでにkaixin001の日常業務を引き受けている。グループの購入事業に参入した多くのインターネット企業は熟慮の末、部門を閉鎖するか外部委託するかを検討している。我々は、近い将来に同様の情報を得ることを期待している。
According to people familiar with the matter, 360buy would only contract its “local life services” business to 55Tuan while retain the “physical product” effort. At the end of the day, the latter is more in line with Jing Dong Mall’s operation since it could be deemed as another channel of promotion and market campaign.
The Gold Rush Mentality
In The God of Gamblers, a recent piece that appeared in the New Yorker about Macau, the author Evan Osnos touched on something interesting. Chinese people see themselves as being more cautious than Americans, but in reality they are far most willing to bear risk. Osnos argues that is in part because Chinese see themselves engaged in a game of chance, so they are willing to take a flyer just in case they get lucky.
This psychology explains why Chinese Internet companies always move in packs. There is safety in numbers. These companies also like the tread in paths that have been established in [by?] others, especially if such paths have achieved tremendous success overseas. Again, nothing is safer than a proven hit. In a sense, it’s just like in a gold rush. Judging by appearance, nothing is safer: how could anyone starve while digging for gold where we know there is gold, and everyone is coming for it?
This is what happened to the business of group buying. Groupon, a site that came out of nowhere in late 2008, had by 2010 rejected a 6 billion dollar offer from Google. This, of course, is nothing new in the Internet era. What’s different, what’s special about Groupon, is that its business model actually makes sense, in the sense that it actually makes money.
For Chinese Groupon wanna-bes, there are also additional benefits. Group buying thrives on thrift and efficiency instead of profligacy and wastefulness, two values that the most traditional of businessmen can identify with. Furthermore, the barrier to entry seems low, while first mover advantage seems high.
Groupon を目指す中国企業にとっては、さらなるメリットがあった。共同購買は、浪費やムダではなく、倹約や効率を追求しており、この2つの価値観は、最も伝統的なビジネスマンが共感するものだ。さらに、参入障壁は一見低く、1社目になるメリットは大きく見えた。
中国のGrouponの後追いビジネスにとっては、さらなる利点がある。グループ購入は、多くの伝統的な事業家が認識する二つの価値、すなわち浪費と無駄ではなく、倹約と効率の上に栄えている。しかも参入障壁は見た限り低く、そして先行者利益は高いように見える。
中国のグルーポンであるwanna-besには、さらに収益源が加えられた。共同購入は、浪費とムダに代わって倹約と効率によって栄えた。この２つの価値観は伝統的なビジネスマンがもっとも共鳴するものである。さらに、最初に動くことの利点は大きいにも関わらず、入る障害は低いのである。
Therefore, it is no wonder that there would be a group buying mania last year in China. Everyone and their cousins were starting a site offering deals. To fend off competitors, all of them spent more than they took in, and most of them were losing money hand over fist. There, of course, would be justifications, gold diggers need their tools, or it takes money to make money.
This year, the dream is deflating like a true fiend’s weight, in part because many of them have ran out of money and have to either sell their operations or close down. Another reason is that the buzz surrounding Groupon have died down after its much publicized IPO. With growing concern regarding its accounting practice (not only did the accounting smell fishy last quarter, but the real concern is that it was the FIRST quarter Groupon ever had to report earnings to the public and it couldn’t pull it off), group buying doesn’t seem to be so revolutionary and profitable after all.
Are there lessons to be drawn from all this? As always, Fools rush in where angels fear to tread. What most of the companies didn’t dwell on was what group buying really is. They saw a golden opportunity from afar and jumped at it.
By doing this, they have forgotten that, in reality almost nothing is more risky than joining the gold rush. Time and time again, we see that in a gold rush, everyone think they are going to get a piece of the action, where in reality only a few strike it rich while other come back empty handed.
こうして、実際にはゴールド・ラッシュに参加することほどリスクが高いことはないということを、彼らは忘れてしまった。何度も何度も我々がゴールド・ラッシュで見てきたのは、誰もが一枚加わろうとするが、実際は、お金持ちになるのはわずか一握りで、残りは手ぶらで帰ってくるという事実だ。
This year, clearer heads seem to prevail. Many companies have admitted to themselves that there is no synergy between its main business and group buying, and that group buying operation by itself it’s a money losing business. That’s why they are increasing selling and outsourcing the effort to third parties.
This is not to deny that group buying does offer something to businesses and consumers. This is why after all the fuss, giants like Dianping.com and Nuomi.com who have deep pockets will survive. Smaller operations will be forced to cut their loss by either selling their business or simply fold if there are no takers.
これは、共同購買が企業や消費者に何ももたらさないと言っている訳ではない。大騒ぎの後、資金力のある大企業 Dianping.com や Nuomi.com は生き残るからだ。もっと小さな事業体は、事業売却か、買い手がなければ単純に事業をたたむかのいずれかによって、損失をカットせざるをえなくなるだろう。
これは、共同購入が誰かに企業や消費者を提供することを否定するものではない。結局のところ、資金力のあるDianping.comやNuomi.comなどの大企業は生き残るからである。より資金力のない企業は、業務を売却するか、引きとり手がいない場合は閉鎖することによって、損失を切ることを強いられるだろう。
