Xin Ou
Research expert covering Greater China
Pinduoduo - statistics & facts
China is the global e-commerce forerunner and home to the largest digital buyer population in the world. Everyone wants to get a piece of the action there, but few know how. One young company, Pinduoduo, managed to take over a large share of the market within less than a decade, threatening the dominance of Alibaba.
Another key element to Pinduoduo's immense growth was its strategy to target the rural market. With more than 700 million residents, China's lower-tier market has overtaken first tier and second tier cities to be the new driver of the country's economy. Considering this, Pinduoduo built a solid user base in lower-tier cities and villages by offering steep discounts.
With the popularity of mobile shopping, Pinduoduo removed the function of shopping on its website and focused on promoting transactions on its mobile app and WeChat mini program. This mini program is a built-in application, which can be used by WeChat users without downloading or installing it. It was there where Pinduoduo secured its early customer network. As of March 2024, Pinduoduo remained one of the most popular WeChat e-commerce mini programs.
The miraculous rise of Pinduoduo
Founded in 2015, Pinduoduo took two years and ten months to hit Nasdaq, becoming one of the fastest IPOs among Chinese internet firms. Today, Pinduoduo is among the world's top ten online retailers, and one of China's biggest online retailers in terms of active user number and market share. The success of Pinduoduo lies in its unique business model, a combination of group buying and social shopping. The platform encourages its users to join team buying to secure a better price and share links for various items with their friends in exchange for coupons.Another key element to Pinduoduo's immense growth was its strategy to target the rural market. With more than 700 million residents, China's lower-tier market has overtaken first tier and second tier cities to be the new driver of the country's economy. Considering this, Pinduoduo built a solid user base in lower-tier cities and villages by offering steep discounts.
With the popularity of mobile shopping, Pinduoduo removed the function of shopping on its website and focused on promoting transactions on its mobile app and WeChat mini program. This mini program is a built-in application, which can be used by WeChat users without downloading or installing it. It was there where Pinduoduo secured its early customer network. As of March 2024, Pinduoduo remained one of the most popular WeChat e-commerce mini programs.
Pinduoduo’s global ambitions
Encouraged by TikTok and SHEIN's phenomenal global triumph, China's e-commerce giants have been more eager to expand their overseas presence than ever. In 2022, Pinduoduo launched its international retail marketplace Temu. Within a short while, Temu got ahead of the pack thanks to its unique affiliate program and social marketing strategy. In March 2023, Temu beat TikTok to be the most downloaded app in the U.S. app store. By July 2024, the global downloads had skyrocketed to over half a billion, up from only 450 thousand in September 2022. Rapid expansion comes along with rising ethical concerns such as over-consumption and labor practices, as well as regulatory risks. It remains to be seen whether the company can achieve sustainable development.
