As previously stated, most of these users came from lower-tiered cities. Pinduoduo, in order to establish itself with more affluent users in cities like Beijing and Shanghai, began onboarding international brands onto its platform. Dubbed Duoduo International, the platform would host authentic products from brands like Apple or Nike. Lastly, Pinduoduo also focused on attracting users from China’s lower-tiered cities. These users, which were traditionally ignored by the bigger players, were also more price-conscious and, at times, lived in remote areas of the country. With group purchases, it suddenly became economically more sensible for sellers to ship there.

1. More than 6.4 million units of tissue paper were sold at RMB 12.9 ($1.90) for 10 boxes and 4.8 million umbrellas were purchased at RMB 10.3 ($1.51) apiece.
2. Through social sharing, users are sending the product information precisely to friends and groups that may have similar income and consumption preferences.
3. Currently, 100% of PDD’s revenue comes from what it calls “online marketplace services.” This is broadly made up of commission PDD takes from sales on its platform as well as advertising it runs.
4. While it’s true that PDD doesn’t take commissions from sellers, remember that you’re still obliged to pay a service fee for utilizing its e-commerce features.
5. As of March 2021, Pinduoduo says it has trained more than 100,000 new farmers in how to operate e-commerce businesses and has committed to train 100,000 more in the coming years.
6. These users, which were traditionally ignored by the bigger players, were also more price-conscious and, at times, lived in remote areas of the country.

The more you shop on the platform the more water droplets you receive, or team purchases and sharing items alternatively enable users to obtain special tools which are accelerating the growth of the tree. The Brand Black Card is aiming to encourage the users leave comments on the items they purchased and offer them with the discount on branded products in return. After 2-4 reviews completion by a user, the Brand Black Card will be granted. As a company targeting low-tier cities, PDD is adept at handling fluctuating market conditions. In response to this demand and to tailor the needs of its user base, the company launched its digital wallet feature called Duoduo.

What products are typically sold on Pinduoduo?

Here, a photo illustration shows the Temu app in an app store reflected in videos of Temu consumers in Washington, D.C. Additionally, the farmers can then also promote their produce through the platform’s live streaming solution. Lastly, Pinduoduo itself also offers https://g-markets.net/ various training courses to established and new farmers. Pinduoduo has connected more than 16 million farmers with users on its platform. In fact, the company invests a significant portion of its cash balances into ensuring the success of its farming partners.

Also, users in these cities also tend to be older and thus less adept at using new technologies. Platforms like Taobao and Tmall were quite complex to navigate while Pinduoduo, vis-a-vis its mobile-first strategy, was more straightforward. The platform’s rapid success allowed the team to raise another funding round (Series C) of about $213.7 million in February 2017. By the end of the year, Pinduoduo had already surpassed 200 million users – in just two years of being operational. On top of that, sellers often have to invest heavily in advertising and logistics – costs they ultimately pass on to consumers. Pinduoduo, which can be roughly translated to “Together, More Savings, More Fun.”, is an online marketplace that promotes group buying.

By the end of 2016, Pinduoduo had already managed to attract more than 100 million users while monthly sales reached around $362 million. Huang’s second company, Leqi, helped foreign brands market their online stores on Chinese eCommerce platforms such as Tmall and JD.com. Pinduoduo (拼多多) is an online marketplace that allows users to purchase goods directly from manufacturers through group buying. Temu’s strategy follows a model that Pinduoduo, the huge Chinese retailer behind Temu, honed when it streamlined connections between farmers and consumers in China’s food and produce sector.

Does Pinduoduo support rural communites?

Reach Chinese customers and an international audience with our professional services. A professional multilingual digital presence combined with the right digital marketing and branding strategy is the best way to unlock this global potential. China Gravy offers translation and proofreading services in three languages – English, Chinese (Simplified), and German. Many aspects of Pinduoduo, from the underserved target markets to the unparalleled distribution afforded by WeChat, are singular and cannot be reproduced. But the lessons of building a socially shared, dynamic experience where the use of app itself drives consistent re-engagement are more important than ever. If Huang could find a way to make buying the most mundane everyday household items exciting and fun, then app developers everywhere can try to find ways to do the same with their apps.

But it is succeeding thanks to a new ecosystem consisting of super app WeChat, mobile payment infrastructure, and mobile-first users. Always remember that your brand is a foreign company in a local platform. So, if you want Chinese consumers to purchase at your PDD virtual storefront, transforming your branding communication into local nuances and languages is of utmost importance. Read along as we share insights on why you should utilize Pinduoduo for your local e-commerce business goals and guide you on how to navigate the app, from account creation to launching digital marketing campaigns. Temu’s “main challenges will be cultivating trust and awareness among customers,” Jacob Cooke, CEO of WPIC, an e-commerce tech and marketing firm that helps foreign brands sell in China, told CNBC.

On top of that, users would also receive cash or free products if they were able to bring a certain number of new members alongside with them. On Pin Hao Huo, they would primarily sell fruits which they stored in their sole warehouse near Shanghai. In one of their first big planned campaigns, which was aided by an $8 million fundraise in May 2015, they would go on to advertise heavily discounted lychees on WeChat. He would then go on to start Xunmeng, a gaming studio that created web-based role-playing games.

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Days after his departure, Pinduoduo finally surpassed Alibaba in terms of annual buyers with 788 million (compared to Alibaba’s 779 million). Diaper maker Daddy’s Choice filed a complaint with a federal court in New York, stating that Pinduoduo knowingly allowed the sale of knockoff products. Just weeks after the protest, in July, Pinduoduo went public on the Nasdaq stock exchange at a valuation of $24 billion. Temu exploded in popularity in the U.S. after its first Super Bowl ad in 2023, becoming one of the most downloaded apps in the United States.

OWN BY THE SAME PARENT COMPANY

Accurately target and engage your audience, and lower your marketing cost at the same time, whether on Google or China’s own search engine Baidu. The latest studies project the worldwide retail ecommerce sales to skyrocket to a new high by 2022. Ecommerce businesses anticipate a 265% growth rate, from 1.3 trillion USD in 2014 to 4.9 trillion USD in 2021. 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. Besides, elderly retirees’ community in China has showed especially loyal to Pinduoduo.

It’s not considered a registration expense because it’ll be used to refund unsatisfied clients. If your offerings don’t have these issues, the money will eventually return to your account. On top of that, keeping yourself updated on brand competitors is an effective strategy to determine where the business stands in the industry. It’ll also save you time and money as these details will tell you which strategy is worth trying and which is a waste of time.

“They don’t really understand how the other makes money,” Huang said to Bloomberg. The GMV basically represents the value of the total amount of goods purchased on the company’s platform. Depending on your brand’s industry, PDD will require you to pay between 10,000 yuan and 50,000 yuan as a deposit fee.

The growth came, in large parts, because of its close partnership with WeChat creator Tencent (a lead investor in its Series C round). Not only were users able to post Pinduoduo links within the messenger but WeChat actively blocked the insertion of links from competing platforms like Alibaba’s Taobao Marketplace. The bold decision to tout its months-old marketplace and app with high-profile TV ads came as the company sought a foothold in the U.S. market. Almost immediately, downloads and use of Temu’s app spiked, according to Momentum Works, a Singapore-based market research firm. Are you interested in growing your business online or do you have any questions?

Digital economy observers outside of China can be forgiven for missing the meteoric rise of Pinduoduo. Today Pinduoduo’s $40+ billion market cap is the equal of JD.com and its 366 million monthly users and 536 annual active buyers are both second in China only to Alibaba. trade the news pricing The Free Pass Card enables users to enjoy the group-buying discount without having to form a team. Users usually get one Free Pass Card after completing two purchases on Pinduoduo. “The retention rate is a big challenge of Pinduoduo, implying potential GMV slow down.

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The investment will see GOME’s product range, logistics and after-sales customer support integrated with PDD. While Alibaba and JD.com make most of their money from e-commerce, they both have other emerging businesses such as cloud computing. There is an option to just buy the item directly but the price of that product is higher than that of buying it in a group.