UBS Evidence Lab data shows CGB gaining traction; Meituan in front

Usage of CGB platforms has continued to rise even as Chinese shoppers have reverted to their pre-COVID lifestyles, based on a new UBS Evidence Lab survey of the shopping behaviour of 1,000 consumers (Figure 4, > Access Dataset). This report builds on top of our earlier analysis via the grassroots lens of group buying managers and industry participants. Nearly 90% of the CGB users surveyed use CGB on a weekly basis, similar to consumer usage of delivery platforms and offline retailers (Figure 5) and some 56% report an average order size of Rmb20-40 compared with Rmb15-25 based on our channel checks at the end of last year (Figure 6). Looking ahead, 45% of CGB users expect to increase spending on CGB platforms and the data suggests rising traction in high-margin products like drinks, snacks and ready-to-eat meals (Figure 7, 8). At the same time, certain categories at supermarkets and wet markets show signs of churn in what we believe to be market share loss to CGB (Figure 12). Improving product mix towards high-margin products and higher order size could be accretive to profitability in the long run. Meituan is the preferred platform (54%) ahead of Pinduoduo (36%), Didi (33%), Xingsheng Youxuan (22%), JD (20%) and Alibaba (18%) (Figure 9).