Founded in 2015, the Chinese social e-commerce platform Pinduoduo generated a revenue of more than 130 billion yuan in 2022, increasing by over 200 times in the past six years. A major factor in the meteoric rise of Pinduoduo was the rapid expansion of China's lower-tier market.
Pinduoduo and small-town youth in China
While the e-commerce market has been nearly saturated in China’s first and second-tier cities, small towns and cities showed their potential as a fast-growing and alluring market for those online retailers. The “sinking market” and “small-town youth” became inevitable topics for every digital marketer. “Whoever gains the small-town youth, gains the market” was the new guideline for almost all e-commerce players to set their marketing strategies.
The online discounter Pinduoduo appeared as a dark horse in the competition. The majority of its users were from the third-tier cities or below, and these users were more sensitive about price.
Scandals regarding counterfeit goods
Pinduoduo went viral among small-town residents for its hard-to-believe price and many cashback actions. From high-tech products like the newest iPhone to daily necessities like toilet paper, Pinduoduo offers lower prices compared to Alibaba and JD.com. Most of the young buyers spent less than 100 yuan a month on Pinduoduo, lower than the average monthly online shopping expenditure in China.
However, cheap doesn’t always mean good. In 2018, the prevalence of counterfeits on the platform brought Pinduoduo to the center of unwanted attention. In that year, Pinduoduo was investigated by the Chinese market regulators for selling fake goods, and in early 2019, it was blacklisted by the U.S. government for its violation of intellectual property rights.
Annual revenue of Pinduoduo Inc. from 2016 to 2022
(in million yuan)
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Pinduoduo. (April 26, 2023). Annual revenue of Pinduoduo Inc. from 2016 to 2022 (in million yuan) [Graph]. In Statista. Retrieved October 04, 2023, from https://www.statista.com/statistics/1030499/pinduoduo-annual-revenue/
Pinduoduo. "Annual revenue of Pinduoduo Inc. from 2016 to 2022 (in million yuan)." Chart. April 26, 2023. Statista. Accessed October 04, 2023. https://www.statista.com/statistics/1030499/pinduoduo-annual-revenue/
Pinduoduo. (2023). Annual revenue of Pinduoduo Inc. from 2016 to 2022 (in million yuan). Statista. Statista Inc.. Accessed: October 04, 2023. https://www.statista.com/statistics/1030499/pinduoduo-annual-revenue/
Pinduoduo. "Annual Revenue of Pinduoduo Inc. from 2016 to 2022 (in Million Yuan)." Statista, Statista Inc., 26 Apr 2023, https://www.statista.com/statistics/1030499/pinduoduo-annual-revenue/
Pinduoduo, Annual revenue of Pinduoduo Inc. from 2016 to 2022 (in million yuan) Statista, https://www.statista.com/statistics/1030499/pinduoduo-annual-revenue/ (last visited October 04, 2023)
Annual revenue of Pinduoduo Inc. from 2016 to 2022 (in million yuan) [Graph], Pinduoduo, April 26, 2023. [Online]. Available: https://www.statista.com/statistics/1030499/pinduoduo-annual-revenue/