The group buying industry in China has gradually regained popularity after a first quarter slump this year.
The number of group buying users hit 42 million at the end of June, up 125 percent from that of December last year, according to data from the China Internet Network Information Center.
This surge is attributed to leading websites improving their customer service and strengthening self-regulation, after many buyers complained of poor service and low-quality products.
China is considered a pioneer of group buying, in which a group of individuals join to collectively purchase identical products from a merchant who is willing to offer discounts for bulk sales. As of June this year, there were about 5,000 group buying websites in China, according to a report by Analysis International.
It is mainly the younger generation that engage in group buying according to Jiang Qiping, secretary-general of the Information Research Center at the Chinese Academy of Social Sciences (CASS).
“Age, income and educational background affect people’s willingness to enter the group buying fray,” said Jiang.
“So far, young, middle-class people with convenient Internet access accountfor a large proportion of group buying shoppers.”
However, Jiang expects lower-income consumers will eventually start group buying when online transactions become more widely available, and vendors that sell traditional commodities, such as pharmaceuticals or books, enter the industry in greater numbers.
For vendors, group buying is a way to introduce their business to more consumers, according o Ni Shenghui, board chairman of Hua’an Yugong Corp, a hot pot restaurant that started operating in Beijing more than a year ago.