China’s Groupon-like site recorded $30 million in Sales

Taobao’s social group buying site, Ju Hua Suan (聚划算) which was launched March last year has recorded USD $30 million in total sales for 2010.

According to China Internet Watch, 5 million users have purchased from the Chinese social group buying website last year. The average spending per user is about $6.

The highest transaction recorded in a single day was about USD $4.6 million during the holiday season on 21 Dec 2010.

Breaking down the sales by the seconds, Ju Huan Suan’s sales rate would be at $0.12 per second (eBay is at $2,000 per second).

Ju Hua Suan’s revenue is just a tiny fraction (1.5%) of Groupon’s estimated $2 billion run rate annual revenue (catch Groupon’s revenue debate here). However, considering that it’s only in its first 10 months of operations, Ju Hua Suan has proven that group buying is in high demand in China and certainly has a lot of room for growth.

So far, Groupon has acquired group buying clones in Singapore, Taiwan and Philippines but has yet to make its move in China. It did explicitly declare its interest in the world’s largest Internet market.  Last month, Rob Solomon, Groupon president and chief operating officer said that “Groupon is analyzing the best way to enter China, India and Korea and that the Middle East is also a likely region.”

Ju Hua Suan and Taobao are both owned by the Alibaba Group. Should Groupon wish to acquire Ju Hua Suan, it has to first go through Alibaba Group’s CEO Jack Ma. Given the wealth of resources and knowledge Jack Ma has in the China market, such deal is almost impossible. Groupon would have to enter the market by acquiring a smaller competitor and also face fierce competition from Ju Hua Suan.

Asia Pacific only accounted for 2.3 percent of Groupon’s web visits in October last year. It seems like Groupon has a lot of work to do in Asia this year.