3. Business Models Analysis
3.3. Model 3: Buyer Requesting Model
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they usually use social medias to promote their daigou offers and to communicate with customers. Partial deposits or full payment in advance are needed in order to make orders.
Online payment is the usual payment method from these examples. Other than frequent travelers, tour guide are also another major seller in this business model as well.
3.3. Model 3: Buyer Requesting Model
Buyer Requesting Model, by its name, indicates that a buyer takes the initiative in the Daigou business to look for sellers. This model is the opposite of Model 2. Since no one specific seller can deliver all his/her desired oversea products. A buyer has to find ways to Daigou sellers.
Posting the Daigou requests on his/her own communication channels is one option. Credible sellers are usually through word-of-mouth of a buyer’s circle and the deals between various sellers can be very different, depending on how a buyer communicates with his/her sellers.
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Three major factors for the selection of sellers are trust, price and product quality, common to all Daigou models. A buyer is willing to pay more for the same product if a seller is more reliable than others with better customer service. Especially when a buyer looks for expensive or luxurious items, mutual trust is one main factor to ensure product authenticity and it explains why the pricing for the same product offered by sellers in the Daigou business can be very different. Besides, a buyer also has to take payment method into consideration, especially for advanced payment. Payment is usually via bank, Alipay or WeChat Pay if products are shipped via carriers. Cash payment is expected if products are delivered in person.
Product selection in this model is more diverse because a customer is able to look for products from different countries, where Daigou agents live or travel to as long as a customer is willing to pay and buyers have intentions to make money. This model is operated effectively only when a buyer knows a certain number of sellers who can purchase on behalf of him/her and those sellers are trustable and reliable. Mutual communication between buyer and seller is important in order to complete the transaction. Although product selection is more diverse in this model, the limitation of Daigou channel (i.e. contacts with sellers) leads to the subsequent development of Models 4 and Model 5.
3.3.1. Model 3: Case Examples
The examples of Waiwai Wong and Kaling Wu fit into this model. Mr. Wong, currently living in Hong Kong, is a usual Daigou buyer purchasing oversea products once to twice per month.
He stated that he purchased through Daigou activity very often because of price, convenience and quality. In his recent Daigou experience, he purchased milk powder, perfume and
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headphone from Germany; watch from Japan; as well as t-shirt, boxers and handbag from the United States and he got these products through his own Daigou agents, who were his friends and a relative. He gave the product pictures with model numbers to them so that they could shop for him.
About the payment method, Mr. Wong transferred money (around 2,800 CNY) in advance to his friend via bank to order the newly launched Japanese Citizen’s watch. Mr. Wong paid approximately 5 percent more than the retail price to his friend and got the rest back in that transaction. However, for German products, he paid around 10 percent of the selling prices as service charges to his friend, which were still lower than what he had to pay in any local stores.
He paid to his friend in cash when he got the products.
For the rest of the products, he simply talked to his cousin living in the United States through Skype. His cousin then shopped for him and sent the products to him by post. Mr. Wong transferred 3,500 CNY (509.4 USD) to his cousin in total through PayPal but the actual price was 3,412 CNY (496.6 USD) only. The whole transaction took around three weeks. Other than that, Mr. Wong also looks for limited edition through Daigou activity. For instance, a year ago, he ordered a pair of limited edition NWD Adidas Shoes from his Daigou agent in Germany.
The new shoes could not be found in any local retail stores in China at that time.
Another example is from Miss Wu’s personal experience. Miss Wu normally contacts with her friends (i.e. frequent travelers) to purchase oversea products first. If no one can help her to shop oversea, she will then post her needs to some specific Facebook pages to look for suitable sellers.
She normally communicates with her Daigou agents about the selling prices before making
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orders and she pays via bank most of the time. She has used Facebooks of “Euro Shopping HK(歐洲品牌專業代購)” and “USA Easy Search(美國品牌代購)” so far to look for oversea products because of their top online ranking and popularity. Recently, she ordered one pair of UGG shoes from Australia and one Kate Spade’s handbag from the United States respectively through these two Daigou platforms.
These examples show that a buyer, in this model, usually finds sellers him/herself if he/she has desires for oversea products, implying that a buyer has to have his/her own contacts with sellers in order to purchase foreign items. Daigou agents may be buyers’ friends, relatives or someone recommended through word-of-mouth or online ranking. Besides, for trustable or credible agents, a buyer is willing to pay premiums or more in order to make orders.
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