Core Insights - The article discusses the strategic retreat of the second-hand trading platform, Zhuanzhuan, from the C2C market, marking a significant shift in its business model towards C2B2C [1][2][5] Group 1: Zhuanzhuan's Strategic Shift - Zhuanzhuan has decided to shut down its C2C business, which has become a financial burden, contributing less than 3% to the platform's total transaction volume [2][3] - The CEO of Zhuanzhuan, Huang Wei, acknowledged that the closure of the C2C business was a difficult but necessary decision, indicating a long-term strategy to focus on more profitable areas [2][5] - The C2C model has inherent risks, including transaction disputes and issues with product authenticity, which have negatively impacted Zhuanzhuan's brand reputation and user trust [3][5] Group 2: Competitive Landscape - The second-hand market is becoming increasingly competitive, with new players like Douyin and Kuaishou entering the luxury second-hand goods sector, indicating a robust market potential [1][7] - Xianyu remains the dominant player in the C2C space, boasting a user base of 215 million, while Zhuanzhuan's user base has declined to 35.88 million, highlighting the challenges Zhuanzhuan faces in gaining market share [3][7] - Aihuishou, another competitor, has established a strong supply chain in the 3C digital sector and is expanding its operations, posing a significant challenge to Zhuanzhuan [7][9] Group 3: Future Challenges for Zhuanzhuan - Zhuanzhuan's shift to a heavy asset model requires substantial investment in quality inspection and logistics, which may lead to increased customer acquisition costs and reliance on advertising [6][9] - The competition with Aihuishou is intensifying, particularly in the 3C sector, where Zhuanzhuan's transaction volume is slightly lower, indicating a need for improved supply chain efficiency [9][10] - The entry of new players with a focus on content-driven transactions is changing the dynamics of the second-hand market, making it essential for Zhuanzhuan to adapt its strategy to remain competitive [10][11]

Core Viewpoint - The company "Zhuanzhuan" is shifting its business model from C2C (customer-to-customer) to C2B2C (customer-to-business-to-customer), indicating a strategic pivot due to declining market share and competition with platforms like "Xianyu" [1][4][9]. Group 1: Business Model Transition - Zhuanzhuan will gradually shut down its "Free Market" business, which supported personal transactions, and focus on the "Official Verification" model [1][2]. - The C2C business currently accounts for only 3% of Zhuanzhuan's revenue, suggesting that the impact of this transition on overall income may be minimal [1][4]. - The shift to C2B2C is seen as a necessary move to avoid direct competition with Xianyu, which has a significantly larger user base [2][4]. Group 2: Market Position and Competition - Zhuanzhuan's monthly active users are significantly lower than Xianyu's, which has surpassed 200 million, while Zhuanzhuan struggles in the millions [2][4]. - In the second-hand mobile phone market, Zhuanzhuan and "Aihuishou" are nearly equal in total transaction volume, with Zhuanzhuan at 5.8 billion and Aihuishou at 6.2 billion [5][6]. - The competitive landscape shows that while Zhuanzhuan has a strong position in mobile phone sales, it faces challenges in maintaining profitability due to high operational costs and reliance on advertising [10][11]. Group 3: Financial and Operational Challenges - Zhuanzhuan is investing heavily in expanding its quality inspection centers, with over 200 million allocated for 2024, indicating a focus on improving service quality [7][8]. - The company has not secured new financing in recent years, leading to increased pressure from its asset-heavy business model [8][9]. - Zhuanzhuan's financial services, including its rental business "Lezu," have drawn scrutiny due to high interest rates and potential regulatory risks, which could impact its financial stability [16][17]. Group 4: User Behavior and Market Dynamics - The second-hand market in China has significant growth potential, with 4 billion old phones generated annually, yet only about 5% are recycled through formal channels [6][10]. - Zhuanzhuan's rental service has attracted users with poor credit histories, raising concerns about the sustainability of its financial model [16][17]. - The company's strategy to diversify into various second-hand goods, including jewelry and electronics, reflects an attempt to capture a broader market [13].

Core Viewpoint - The company, Zhuanzhuan, is transitioning from a C2C model to a C2B2C model, marking the closure of its original C2C marketplace business as a strategic decision to focus on quality and trust in second-hand transactions [5][10][14]. Group 1: Business Transition - Zhuanzhuan officially announced the gradual shutdown of its C2C marketplace business starting September 22, 2025, as part of a broader business adjustment towards an "official verification" model [4][5]. - CEO Huang Wei described the decision to close the C2C business as a difficult yet necessary choice, emphasizing the need to focus on consumer trust and service quality [5][10]. - The C2C business had become marginal, contributing less than 3% to Zhuanzhuan's overall GMV, indicating that the shutdown would not significantly impact the company's operations [9]. Group 2: Quality and Trust - The shift to a C2B2C model aims to standardize non-standardized second-hand transactions, enhancing trust between buyers and sellers [6][12]. - Zhuanzhuan has invested heavily in quality assurance, establishing three quality inspection centers and training over 2,500 quality inspectors to ensure product authenticity and reliability [11][14]. - The company has expanded its service network, with nearly 3,000 on-site recovery engineers covering over 1,300 districts and cities, and more than 1,000 offline stores across over 300 cities [11][12]. Group 3: Market Positioning - The closure of the C2C model is seen as a strategic move to address industry challenges such as fraud and poor after-sales service, which have deterred users from engaging in second-hand transactions [10][11]. - Zhuanzhuan's ambition extends beyond electronics, aiming to establish a comprehensive second-hand marketplace that includes luxury goods and various consumer categories [13][14]. - The company is positioning itself to define the standards for "quality second-hand" goods, contributing to the development of a circular economy [14][15].

Core Insights - The second-hand consumption market in China is undergoing significant changes, with major players like Zhuanzhuan Group exiting the C2C business, indicating a defensive contraction in response to fierce competition [1][3] - The current market landscape is dominated by platforms like Xianyu, which benefits from Alibaba's ecosystem, and Aihuishou, which has recently gone public and reported its first quarterly profit [3][4] - Aihuishou's profitability is closely tied to government policies that encourage recycling and upgrading, leading to a temporary surge in consumer willingness to trade in old items [4] Company Developments - Zhuanzhuan Group announced the closure of its C2C business, marking the end of a decade-long operation, with a timeline for shutting down services from September to October [1] - Aihuishou's parent company, Wanwu Xingsheng, reported a record revenue of 4.99 billion yuan for Q2 2025, achieving its first quarterly profit since going public [3][4] Market Challenges - Aihuishou faces significant user complaints regarding valuation discrepancies, where initial high estimates are drastically reduced after physical inspections, leading to a loss of consumer trust [6][7] - The traditional second-hand platforms are challenged by social media platforms like Xiaohongshu, Douyin, and Kuaishou, which are changing consumer decision-making processes and creating new trading dynamics [9] Strategic Insights - The current model of online high estimates followed by offline price reductions may not be sustainable, as it risks alienating consumers who prefer more transparent pricing [11] - Aihuishou's heavy reliance on a standardized valuation and offline stores may limit its growth potential, while competitors are exploring new market segments and innovative approaches [13][15] - The industry is moving towards content-driven second-hand consumption, which may become the mainstream model, contrasting with Aihuishou's traditional approach [9][13] Future Considerations - The sustainability of relying on government subsidies for growth is questioned, as past experiences in other sectors suggest that this strategy may not be viable long-term [16][17] - Aihuishou is encouraged to focus on improving local recycling efficiency and ensuring accurate online valuations to enhance consumer trust and engagement [15]

Core Viewpoint - Zhuanzhuan, a well-known second-hand trading platform in China, is shifting its business model from C2C to C2B2C, closing its "free market" operations that have been running for ten years, in response to competitive pressures and trust issues in the C2C model [1][2][11]. Summary by Sections Business Model Transition - Zhuanzhuan will gradually shut down its core C2C "free market" business, starting with the closure of personal product posting on September 24, followed by the removal of browsing and purchasing options by September 29, and the final closure of customer service by October 31 [4][5]. - The platform will now focus on C2B2C, where sellers can sell items through recycling, consignment, and listing, with the platform providing official quality inspection services [5][6]. User Impact - The closure of the free market will significantly impact specific user groups, particularly those trading niche items like collectible cards and dolls, who may find it difficult to adapt to the new model [9][11]. - Users have expressed concerns over the higher prices of officially inspected items and the platform's shift towards self-operated sales, making it harder for ordinary sellers to complete transactions [7][11]. Trust and Quality Issues - The C2C model has faced trust challenges, including online fraud and gray market transactions, which the platform struggled to manage effectively [11][12]. - Quality issues in second-hand goods, such as undisclosed defects and counterfeit products, have led to a poor shopping experience for consumers [12][14]. Operational Challenges - The new C2B2C model requires Zhuanzhuan to invest more resources in quality inspection and after-sales service, as the platform will now be directly responsible for these aspects [15][16]. - While the official inspection model aims to enhance trust in transactions, it may also increase operational costs, which could be passed on to consumers, necessitating a balance between cost control and user experience [16].

Core Viewpoint - The second-hand business has significant potential, but the second-hand e-commerce platform faces challenges, leading to strategic shifts in companies like Zhuanzhuan, which is transitioning from C2C to C2B2C models [2][11]. Group 1: Zhuanzhuan's Strategic Shift - Zhuanzhuan has decided to strategically withdraw from its C2C trading business, closing the "Free Market" feature and focusing on "Official Recycling" and "Consignment" services [2]. - The CEO of Zhuanzhuan, Huang Wei, acknowledged that the "Free Market" has facilitated online fraud and disputes, making it difficult to manage [2][11]. - Zhuanzhuan's C2C business now accounts for less than 3% of its total operations, indicating a significant decline in this segment [2]. Group 2: Competitive Landscape - Zhuanzhuan faces stiff competition from Xianyu, which has over 600 million registered users and daily GMV exceeding 1 billion yuan, making it a formidable rival in the second-hand market [4]. - Despite initial backing from 58.com and Tencent, Zhuanzhuan has struggled to maintain user engagement, with active users dropping significantly after aggressive marketing ceased [6][8]. - The competitive dynamics are shifting as Zhuanzhuan pivots to a model that emphasizes quality assurance, but it still needs to build a reliable "traffic pool" to sustain its operations [11][14]. Group 3: Financial Backing and Investments - Zhuanzhuan has received substantial investments, including $200 million from Tencent in 2017 and an additional $300 million in 2019, followed by $390 million in subsequent rounds [6][8]. - The influx of capital allowed Zhuanzhuan to invest heavily in marketing, but user retention has been a challenge once spending decreased [6][8]. Group 4: Quality Assurance and Trust Issues - Following a trust crisis related to inconsistent quality reports, Zhuanzhuan has implemented a "7-day no-reason return" policy and expanded its quality inspection team significantly [12][14]. - The company has established three major quality inspection centers across the country, aiming to enhance consumer trust in its services [12]. Group 5: Future Competition - Zhuanzhuan's shift to a C2B2C model may lead to direct competition with Aihuishou, which has a strong offline presence and has expanded its business model to include various categories of second-hand goods [15][17]. - The offline market is becoming increasingly competitive, with Aihuishou leading in store coverage, while Zhuanzhuan is also expanding its physical store presence [17].

Core Viewpoint - The company "Zhuanzhuan" is officially shutting down its C2C business model, which has been operational since 2015, and is shifting its focus entirely to a C2B2C model, indicating a significant strategic pivot in its business operations [1][9]. Group 1: Business Model Transition - Zhuanzhuan will gradually close its C2C business in three steps: stopping the posting feature on September 24, halting transactions on September 29, and providing after-sales support until October 31 [1]. - The C2C model, which operates on a "person-to-person" basis, has been deemed unsustainable, requiring nearly 200 million yuan in annual subsidies while only contributing 30% to the company's revenue [6][9]. - The new C2B2C model, which involves a "person-platform-person" structure, will allow Zhuanzhuan to offer services such as recycling, quality inspection, and after-sales support [4]. Group 2: Market Position and Competition - Zhuanzhuan's monthly active users (MAU) are significantly lower than its competitor, Xianyu, which boasts over 200 million MAU and a strong user community [8]. - The company has struggled to retain users due to its transactional nature, lacking the community engagement that Xianyu has built through interest-based groups [8]. - Previous attempts to pivot towards a C2B2C model, including the launch of verification services and the merger with another platform, have not yielded positive results, leading to a decline in user engagement [9]. Group 3: User Sentiment and Challenges - User reactions to the closure of the C2C model have been mixed, with some expressing strong attachment to the platform and concerns over increased fees on competing platforms [6]. - The company faces significant challenges in building trust within the C2C space, as issues such as fraud and disputes have been prevalent, leading to a loss of confidence among users [6].

Core Viewpoint - The decision by Zhuanzhuan Group to gradually shut down its C2C "free market" business marks a significant shift in the second-hand e-commerce landscape, leading to two distinct operational models that diverge in their approach to building consumer trust [1][11]. Group 1: Zhuanzhuan's Approach - Zhuanzhuan aims to industrialize trust by standardizing and streamlining the process of second-hand transactions, treating trust as a product that can be manufactured [1][5]. - The company has invested heavily in establishing three intelligent quality inspection centers in Shenzhen, Chengdu, and Qingdao, employing over 2,500 quality inspection engineers to ensure rigorous product checks [3][5]. - The transformation from non-standardized products to standardized ones with detailed quality inspection reports enhances transparency and builds consumer trust [5][9]. - Zhuanzhuan has implemented a comprehensive delivery network with over a thousand offline brand stores across more than 300 cities and a team of nearly 3,000 engineers for on-site recycling [5][7]. - The introduction of a seven-day no-reason return policy and a 365-day warranty for certain product categories is a groundbreaking move in the second-hand industry [7][9]. - By the end of 2024, Zhuanzhuan plans to have participated in the formulation of 30 national and industry standards, further legitimizing its trust-building efforts [9]. Group 2: Comparison with Xianyu - Xianyu adopts a decentralized trust-building model, creating an ecosystem where trust can self-generate and self-repair, supported by a vast user base of over 500 million [13][18]. - The platform positions itself as a community for young people, where transactions are often driven by shared interests rather than mere buying and selling [15][16]. - Xianyu provides a "light governance" approach, relying on Alibaba's robust e-commerce infrastructure to facilitate transactions while allowing community-driven trust development [18][20]. - Despite their differing models, both Zhuanzhuan and Xianyu aim to elevate second-hand consumption to a mainstream lifestyle choice, moving away from the stigma associated with second-hand goods [22][24]. - The two companies are not in direct competition but rather complement each other in a large second-hand market, with Zhuanzhuan focusing on reliability and Xianyu emphasizing the enjoyment of discovery [26][28]. Group 3: Industry Implications - The contrasting approaches of Zhuanzhuan and Xianyu represent a broader industry evolution, with Zhuanzhuan's industrialized certainty versus Xianyu's ecological possibility [29]. - Both companies are contributing to the maturation of the second-hand market, with Zhuanzhuan establishing formal standards and Xianyu fostering community norms through user interactions [26][31]. - The exploration of these models is significant as it enhances the core value of the second-hand industry, transforming it from simple information matching to a more complex value reconstruction process [31].

Core Insights - The core decision of Zhuanzhuan Group to shut down its C2C "free market" business and transition to a C2B2C "official verification" model reflects a significant strategic shift aimed at enhancing consumer trust and service quality in the second-hand e-commerce sector [2][7][12] Business Model Transition - Zhuanzhuan is moving from a traditional C2C model, which relies on user-to-user transactions and is prone to issues like fraud and disputes, to a C2B2C model that emphasizes platform involvement in the transaction process [9][10][12] - The C2B2C model allows Zhuanzhuan to take on responsibilities such as quality inspection, recycling, pricing, and after-sales service, thereby creating a more reliable transaction environment [12][13] Market Context - The second-hand market in China is projected to exceed 3 trillion yuan, driven by changing consumer preferences towards quality and assurance rather than just low prices [7][17] - The market faces challenges such as trust deficits, lack of standards, and fulfillment difficulties, which the C2B2C model aims to address effectively [17][18][20] Trust and Standards - The C2B2C model transforms the trust mechanism from "person-to-person" to "person-to-platform," leveraging the platform's brand reputation and service capabilities to enhance consumer confidence [18] - Zhuanzhuan has established its own quality inspection standards, addressing the non-standard nature of second-hand goods and providing clear evaluations to consumers [20][22] Service Infrastructure - Zhuanzhuan has invested in a comprehensive service infrastructure, including smart quality inspection centers and a nationwide network of recovery engineers, to improve transaction efficiency and reliability [22][24] - The company has also introduced consumer-friendly policies such as a seven-day return policy and one-year warranty, setting new industry standards [24] Financial Performance - Zhuanzhuan achieved its first annual profit in 2022 and has maintained profitability, demonstrating the viability of its C2B2C model and its ability to create sustainable business value [25][27] Industry Impact - The strategic divergence between Zhuanzhuan and its competitor Xianyu highlights different approaches to the second-hand market, with both companies contributing to the evolution of China's circular economy [27]

Core Viewpoint - The company, Zhuanzhuan Group, announced the gradual shutdown of its "Free Market" business, marking a strategic retreat from direct competition with Xianyu in the second-hand e-commerce sector [1][2]. Group 1: Business Transition - Zhuanzhuan's CEO, Huang Wei, described the shutdown as a "strategic retreat," indicating a shift towards a C2B2C model that has been in motion since 2019 [2]. - The C2C business, which was the foundation of Zhuanzhuan, now accounts for less than 3% of the company's total share, highlighting the need for transformation [3]. Group 2: Financial Performance and User Engagement - Zhuanzhuan has invested heavily in advertising, particularly on platforms like Bilibili and Douyin, but the effectiveness of this investment appears limited, with monthly active users only increasing from 24.73 million to 35.88 million, a year-on-year decrease of 5.3% [3]. - The company has generated over 25 billion yuan in revenue since its establishment, with registered users exceeding 400 million by the end of 2024 [3]. Group 3: Quality Assurance and Trust Issues - The shutdown allows Zhuanzhuan to focus on its "Official Verification" business, which has seen significant investment, including 1.5 billion yuan for quality inspection centers and over 2 billion yuan planned for 2024 [4]. - Despite these efforts, trust issues persist, with over 110,000 complaints on the Black Cat Complaint platform, primarily related to discrepancies in product descriptions and quality verification [5]. Group 4: Competitive Landscape - Xianyu, as the leading player in the second-hand market, has surpassed 200 million monthly active users, growing nearly 20% year-on-year, and has established a unique ecosystem combining transactions and community engagement [6][8]. - The market is expected to polarize, with Xianyu dominating the C2C segment while Zhuanzhuan and competitors like Wanwu Xingsheng compete in the B2C quality market [9].