Pinduoduo Wikipedia

As much as 65% of the Pinduoduo’s transactions are completed through its WeChat mini program. Pinduoduo makes it seamless that without having to download its app, users could directly share the items with do not even have to leave the WeChat app throughout their entire ordering process. Later in 2018, Pinduoduo has also started to incentivize users to go to the standalone Pinduoduo app, over 60% of active users have come from and rely on Pinduoduo’s WeChat mini program.

  1. Huang seems to be right about how the two industries can work together.
  2. As Pinduoduo gets into life as a public company, the firm is following the e-commerce giants in cleaning up the platform.
  3. Users will get one Brand Card after they purchased a branded item, and they can alternatively share with their friends to attract them browsing and ultimately purchasing the branded products.
  4. This encourages buyers to share links to the item they are buying with friends and family or over social media.
  5. Member Card are different kinds of the rewarding, aiming to help users save money via vouchers or special discount by sharing amongst their friends.

A large part of PDD’s growth has been driven by the fact that it can be accessed on Tencent-owned messaging service WeChat, which has over a billion monthly users. WeChat is a key part of daily life in China and allows people to make payments within the app. ETOC also provide free educational content to help brands understand more about China e-commerce and digital marketing. The in-app game is aiming to mimic a real shopping experience for the users in order to maintain as longer as the user retention. Member Card are different kinds of the rewarding, aiming to help users save money via vouchers or special discount by sharing amongst their friends. Launched in 2015, Pinduoduo has been now a leading social e-commerce application and one of the fastest growing platforms in China.

China’s e-commerce giant Pinduoduo quietly launches U.S. shopping site in Amazon challenge

Although the country’s e-commerce market is highly consolidated, it’s not impossible for startup teams to crack this market as long as they are solving the right problems for the right group of customers. Alibaba took a controlling stake in Singapore-based Southeast Asian e-commerce site Lazada in 2016 and has since invested money in the business to expand its presence in the region. Alibaba also has a separate website called AliExpress that services markets like Europe and the U.S. In March, Alibaba launched a special version of its Taobao app that focuses on the so-called customer-to-manufacturer (C2M) model, which has been behind the rise of PDD. That’s where consumers can interact and buy direct from the manufacturer rather than going through a third-party seller. In terms of market share, PDD is the third-largest e-commerce player in China behind Alibaba and, according to a report released in July 2019 by eMarketer.

Another counterfeit heaven in China?

Comparatively, the forward price to sales multiple for peer e-commerce companies such as Etsy and Hello Fresh stand at 30x and 29x respectively. Analysts tracking Pinduoduo have an average target price of $70.55, which is around 10% above its current trading price. Community group buying has seen a rapid shift in fresh produce and grocery shopping habits in many parts of China.

Report on the topic

Since the listing of the Pinduoduo Inc ADR on the NASDAQ in July 2018, the Pinduoduo stock price has increased by more than 100%. There are currently also some categories that have very few products. For example, the men’s wristwatch category had just two products listed. Temu marks Pinduoduo’s biggest push overseas yet as the domestic Chinese economy faces a number of challenges from a resurgence of Covid-19 to an energy crunch. That has hurt economic growth in China and dampened consumer sentiment. JD is known for being able to deliver items on the same day or day after.

In 2015, Huang launched Pinhaohuo, a social commerce platform for fruits, with the team from his second startup Leqi. Last year, PDD disclosed that 45% of its gross merchandising value (GMV) came from first and second-tier cities. “Direct buyer traffic to PDD is primarily generated from word of mouth referrals by its existing buyers as well as the effect of its marketing campaigns,” Shanghai-based Guotai Junan Securities, said in a report from March. “A portion of the Company’s buyer traffic comes from its user recommendation or product introduction feature which buyers can share with friends or contacts through social networks such as WeChat and QQ.” Pinduoduo has leveraged its platform and developed the Internet+ Agriculture initiative to facilitate direct sales between small-scale farmers and consumers. The platform makes recommendations to consumers based on their shopping preferences due to which it is able to aggregate demand and generate large volumes of orders for farmer merchants.

Over 88.4 percent of Pinduoduo’s RMB 1.2 billion ($180 million) Q1 revenue was spent on marketing. This could be translated as a sign of difficult traffic acquisition. But tightening regulation is causing more friction between Pinduoduo and its merchants on the platform. In June, fourteen store owners who sell products on Pinduoduo protested under the company’s office building claiming that Pinduoduo conducted improper product-quality checks which damaged the owners’ rights.

When a user selects an item on Pinduoduo, they can choose to participate in group buying. Find out more at or stay updated by following us on the social media below. Pinduoduo is literally recognized as a consumer-to-manufacturer (C2M) model, consumers create value for manufacturers and provide merchants ideas for the production according to the consumer demands. The Brand Card is aiming to promote the branded products on the platform. This is important for the platform that most of the Chinese consumers reply heavily on the reviews and recommendations of the items from the existed buyers to make decision. The Price Chop mechanism encourage users to get the items that they want for free by sharing with their networking within 24h.

Want to have a first free consultation session about e-commerce and digital marketing in China? Moreover, this direct-to-consumer model indicates to cut out the middlemen and further deliver price savings to the customer, which in turn generates more demand and economies of scale. In return, users will receive free fruit from Pinduoduo after the virtual tree reaches its maturity virtually. “If you close your eyes and visualize the next stage for Pinduoduo, it would be a combination of ‘Costco’ and ‘Disneyland’, driven by a distributed network of intelligence agents,” Huang wrote in the IPO prospectus.

Combined with the extra satisfaction of scoring a good deal with your friends as a team, Pinduoduo soon became a viral sensation in China. Its mobile-only social shopping platform has allowed Pinduoduo to grow revenue at an enviable pace over the years. The company’s team purchase model transforms online shopping into a dynamic social experience and its platform resembles a virtual bazaar. This dynamic business australias favourite spreads market findings model has also allowed Pinduoduo to increase customer engagement and ensure repeat purchases. Like Alibaba’s Taobao and rival, Pinduoduo is an e-commerce platform that offers a wide range of products from daily groceries to home appliances. Pinduoduo’s twist lies in its integration of social components into the traditional online shopping process, which the company describes as the “team purchase” model.

Due to its robust business model, Pinduoduo has managed to increase revenues from just over $2 billion in 2018 to $14.7 billion in 2021. Analysts tracking the stock expect the company will grow its sales to $22.5 billion in 2022. Buyers can access the platform and make group purchases by visiting Pinduoduo directly or via popular social networks such as QQ and Weixin. Further, the total number of active buyers on Pinduoduo in 2021 (users who placed one or more orders throughout the year) hit a record of 868.7 million, up 10% compared to 2020. Pinduoduo’s Temu is a cross-border e-commerce website with most products likely to come from overseas, especially China.

The combination of featuring both e-commerce and social sharing creates a new social life for Chinese users that they can purchase online items by engaging with the social groups and team purchasing. Therefore, a social chat platform like WeChat acts as a crucial weapon for Pinduoduo to build a good “word-of-mouth” and ultimately facilitate the social sharing function. This function also helped Pinduoduo to displace Taobao from the No. 1 position of e-commerce apps in just two years. Founded in 2015, Pinduoduo is a mobile-only marketplace that connects millions of buyers directly with sellers. It has become one of China’s most popular e-commerce platforms in recent years for fresh produce, household items, clothing and electronics. The company aims to bring more businesses and consumers online so that local communities and rural agricultural prodcuers can benefit from the growth of the digital economy.

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