SOFT DATA
Pinduoduo is a third-party social commerce platform, mainly providing group buying offers aat reduced prices. Pinduoduo has an app and a WeChat Mini Program. Pinduoduo offers products such as clothing, fresh produce, household items and electronics. When looking at a product, users are presented with two price options, a standard price to buy directly and a discounted price. Discounted prices are unlocked when users form ‘teams’ of at least two buyers.
Pinduoduo's initial strategy was to tap into lower-tier cities and rural markets, which have limited disposable income and less brand conscious, with more affordable products. It quickly became a success in China's less developed areas, where consumers are more price-sensitive. However, along with the China's economic slow down, more first and second-tier city consumers are actively looking for bargains of fresh produce. During 6.18 shopping festival in 2019, 70% orders for agricultural products from Pinduoduo came from first and second-tier cities, which lead to an aggressive 85% y-o-y MAU increase in Q3 2019.
Pinduoduo launched a joint "RMB 10 billion" initiative with brands and merchants and gave our coupons and subsidies to incentivize consumers. Pinduoduo is also fully committed to providing the best value to consumers. Rather than leave the work to consumers to compare prices across multiple e-commerce platforms, Pinduoduo introduced a "Hassle-free price check" program with over 300 staff monitoring prices in real-time across all e-commerce platforms. If a lower price was found on another site, Pinduoduo will adjust the pricing accordingly to ensure the prices were the lowest in the market.
