Alibaba announced today that the largest Chinese B2C site is spinning off its group buying platform Juhuasuan (translates to “deals aggregator”) , making the Taobao-owned platform another Alibaba-Taobao subsidiary on the heels of Taobao’s spin-off of Etao.com, a price comparison service with affiliate programs.
Juhuasuan tops China’s group buying market in this August in terms of Unique Visitors Per Day with over 9.7 million people using it every day, according to a report by Chinese researcher iResearch. Lashou and 55Tuan comes in second and third in the report.
According to an internal email, “Taobao’s primary responsibility is to serve as a cradle for Chinese entrepreneurs, to foster the prosperity of SME as well as to take the lead in ecommerce ecosystem.”
It’s noteworthy that all of those deals on Juhuasuan come from Taobao.com or Tmall.com as opposed to other group buying services whose deals were provided by local businesses ranging from movies, restaurants to hotels, bars and so on.
According to an Alibaba exec, the new subsidiary will act as “a low-cost, high-efficient and mature ecommerce platform for group buying industry” with more details to be announced soon.
8.7% of Chinese netizens (42.2 million) use group buying services, a CNNIC (China Internet Network Information Center) report revealed. Shao Xiaofeng, Secretary General of Alibaba said that it seems to the ecommerce giant group buying has became an independent business model with a RMB hundreds of millions worth of market emerging in the next three to five years.
Meituan, one of the largest group buying site founded by serial entrepreneur Wang Xin, raised US$ 50 million in Series B led by Alibaba and other investors.