Over the years, this social commerce app has utilized third-party checkout methods like WeChat Pay and Alipay. These virtual wallets have given Pinduoduo more access to tech-savvy shoppers who prefer complete digital transactions. If you look at the data in the graph below, it’s easy to see that the users have evened out between the two genders. In 2022, the male demographic has covered 51.8% of overall users in the platform, while the female user base gets 48.2%.

Its aggressive pricing strategy has helped it quickly gain market share over the past few years. Pinduoduo’s Temu is a cross-border e-commerce website with most products likely to come from overseas, especially China. Pinduoduo launched its U.S. online shopping site as the Chinese e-commerce giant makes its first major push overseas. “In addition to offering more savings, we are also expected to meet consumers’ needs for higher quality products,” he said. But the company acknowledged that the competition is going to get more intense as rivals try harder to lure consumers with more price cuts. Temu, PDD’s international app, was launched in 2022, and as of last November it had acquired nearly 17% of the US online discount store market, according to Earnest Analytics.

The Brand Card is aiming to promote the branded products on the platform. To get the item for free, the user must share their link with as many friends as possible. The Price Chop mechanism encourage users to get the items that they want for free by sharing with their networking within 24h. The Daily Check-in mechanism is to encourage users open the apps everyday with the redeemable points reward which can be deducted in their item purchasing. It utilizes the social networking to connect like-minded shoppers and various gamifications to draw so many users gradually addicted to the platform. When Pingduoduo was starting out, there was a shift in the Chinese e-commerce landscape.

Because of recent issues about security, you can’t download it from Apple’s App Store or Google Play Store. Many also questioned the validity of entertaining features in Pinduoduo’s value proposition. “We have observed that a few users find shopping on Pinduoduo to be very entertaining, which is attributable to its extremely low pricing and interaction among Weixin users,” according to research institute 86 Research. In April 2018, Pinduoduo completed a new round of financing raising $3 billion at a valuation of nearly $15 billion. Given Pinduoduo’s WeChat-based ecosystem, Tencent joined the round as a returning investor. Pinduoduo’s annual GMV (gross merchandise volume) surpassed bond yields and market pricing RMB100 billion ($14.7 billion) in 2017, that’s around two years since its inception.

Compared to the previous year, it reaches up to 1,000 percent year on year growth according to data from Jiguang. Comparatively, the forward price to duties and responsibilities of real estate broker 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. The GMV basically represents the value of the total amount of goods purchased on the company’s platform.

What is Pinduoduo’s model?

1. However, there is massive potential for companies to gain traction in lower-tier cities in China in the upcoming decade which will be a key driver of revenue growth.
2. The Daily Check-in mechanism is to encourage users open the apps everyday with the redeemable points reward which can be deducted in their item purchasing.
3. 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.
4. 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.

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. 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. This is an effective incentive for the platform to promote its branded products. Although Pinduoduo claims to have several channels to lower product prices, increasing product quality and counterfeit complaints still raise concerns for a how to sell nfts the motley fool possible low-cost and low-quality association. Complaints mainly target at the problems of poor quality, slow delivery, misleading ads, etc. Consumption upgrade, a trend in which affluent Chinese customers are increasingly willing to pay for quality, has dominated China’s e-commerce industry in the past few years.

Pinduoduo’s global ambitions

Pinduoduo suffered a net loss of RMB 292 million ($43 million) and RMB 525.1 million ($77 million) in 2016 and 2017, respectively. Its net losses reached RMB 201 million ($30 million) in the first quarter of this year. The net loss is expected to be widened, mainly attributable to investments in branding and ads. Over 88.4 percent of Pinduoduo’s RMB 1.2 billion ($180 million) Q1 revenue was spent on marketing.

Bargain-hungry Americans are flocking to Temu and making its Chinese owner very rich

Each item has a minimum number of buyers required to complete the purchase. If that number is not met within 24 hours, then the group buy is cancelled and those who have already committed money will be refunded. Pinduoduo did not immediately reply to a request for comment on Thursday.

Pinduoduo focuses on the social shopping element

Pinduoduo has seamlessly integrated its platform with major social networks in China and created a highly engaged social buying ecosystem. It has also partnered with third-party online payment service providers such as QQ Wallet, Alipay, and Apple Pay to facilitate payments. In the 2021 calendar year, Pinduoduo’s reported an operating profit of just over US$1.2 billion. This was Pinduoduo’s first ever annual operating profit since becoming a public company. Similar to most other early-stage e-commerce stocks, Pinduoduo was unprofitable for around 5 years after launching. The company’s first ever quarterly net profit was recorded in the second quarter of 2021.