There are no earthshaking changes on the Daily Deal market in China in our data. The earthshaking part was/is in the press. They’re about firing lots of staff after hiring a lot. They’re about the money invested and the same money spent in advertising ( for some of the market leaders at a RMB 200-300mio rate per year).
Dataotuan measures the results of all those big moves. Surprisingly: these results … don’t move a lot. It seems that for now the players in the top 10 remain the same contestants, some up, some down. Gaopeng still lingers around position no. 11.
On the other hand, the one really big move is the move to “more”:
the Daily Deal websites love moving an increasing number of deals. Since May – when we started publishing our reports - the number of deals launched every day has doubled.
The top 3 in Revenue (QQ, 55tuan and Lashou) are leading in this (growing) number of deals. But not in “top deals”!
Indeed, they don’t contribute a lot to the top deals (the top 500 deals with the most revenue). It’s the numbers 4 to 7 (Dianping, Nuomi, Manzuo and Meituan) that are the winners.
Is it fair to conclude already that the top 3 deals sites stand out because of the massive quantity (for the moment), while the No.4-7 deals sites are focused more on the quality of each deal?
We’ll follow that trend in the months to come.
What’s the reason that Dianping continues being by far the leader in these quality deals? Let’s guess: they had already long before the Daily Deal frenzy started plenty of recommendation of shops. Their old and new users can now instantly see the quality of the shop that offers a deal…
As we have seen since last month, the consequence of the avalanche of deals is that the revenue per deal continues to decrease (with 1/3 since May) and the average number sold per deal declines, by almost 50%. Hopefully the net profit on each of the deals doesn’t follow that steep decline.
For the whole Group-buying industry as well as the big deal sites, Quantity or Quality, is the question. This will also decide how far they can go. At a recent presentation by Dataotuan at the TFMA Event in Shanghai more insights about the future of Tuangou websites were presented.
Our special this month involves – a heavy on the stomach – insight in how daily deals follow the daily pattern of the seasons.
In August, the month before Mid-autumn Festival, Moon cake deals were very popular: 10,685 deals were launched, which accounted for 9% in total deal number, 6% in total revenue.
At the end of the Chinese year, we’ll come up with a special edition on Seasonal deals.
And in the meantime soon hairy crab deals and later on maybe Halloween deals and Christmas deals.