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Rumor: Lashou Shifts to B2C Mall Business Model

DoNews, 11/07/11

Chinese group buy site Lashou has reportedly begun corporate restructuring, shifting its business model to a lifestyle-focused e-commerce mall format. Lashou has already notified a number of its branch offices of the upcoming changes, according to a source within the company, and will redesign its website to resemble those of its soon-to-be rivals Taobao Mall and 360Buy. Lashou's plan for "Lashou Mall" will entail signing long-term contracts with sellers and a bi-annual membership fee of RMB 1,980 for partners.

Lashou has yet to publicly reveal details of its new operating model, but sales employees with the company have reportedly begun informing clients of the coming changes, emphasizing the low cost for entry to the new platform, as well as significantly lowered costs for promotional activities, discounts on featured goods, and other services that Lashou Mall will provide.

Lashou executives previously indicated in at least one internal meeting that the future of the group buy industry lies in a transformation to an e-commerce model; for Lashou, this will entail store owners operating their own virtual stores and promotions, either for a flat entry fee or commission on transactions.

Lashou, currently in the midst of a quiet period pending its upcoming IPO, has declined to share details of its new business model.

Keywords: corporate restructuring e-commerce Internet IPO B2C business model Lashou group buying

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