Pinduoduo: Succeeded because of mastering social media
Pinduoduo
In 2020, Pinduoduo overtook Jingdong to become the second most valuable online retailer in China. The main reason for its success is its perfect strategy with social media.
Time
Pinduoduo was established in 2015. This year, the biggest news for online retailers is that during “double eleven” (Chinese black Friday), Taobao’s total transactions is 91.2 billion yuan (11 billion pounds). Meanwhile, another data is also very important. There are 549 million people using WeChat. A quarter of them opens WeChat 30 times a day and half of them open WeChat at least 10 times a day. Seems the appearance of Pinduoduo is right on time.
Magic
Pinduoduo found a magical way to be an online retailer. The basic mode of Pinduoduo is “more buyers, lower prices”. This is not an invention, there are plenty of companies doing the same. But why did Pinduoduo stand out from the crowd and dominated? The difference is that Pinduoduo used an official account in WeChat to be an online retailer. The fans number of Pinduoduo has grown rapidly. This combination simplified the whole process. Before Pinduoduo, you have to call all your friends and relatives to help you to get a lower price. Now, you just group message the link with a few taps in WeChat. And this is not even the magical part. In the meantime, as people using Pinduoduo, they are not only customers but also promoters. They send the link to everyone they know. And those who received the link will pass it on to their relatives and friends. After all, who wouldn’t want a lower price?
Conflict
Their story is not all smooth sailing. In 2018, Pinduoduo had a crisis of counterfeit goods. Those who failed on other platforms, came to Pinduoduo because the restriction was not critical at that moment. People criticize their product quality and doubt if the company could solve the problem. In the beginning, Pinduoduo had some regular actions. They try to control the maximum number of a single kind of product. Investigation of frequently reported sellers was initiated. However, the smartest action showed up as an activity.
The 10 billion subsidies
Pinduoduo commits to its customers to choose genuine sellers and spend money to cut their prices for customers. This action gave customers a chance to buy genuine products at a lower price. It also made the market bigger. Before the subsidy, customers of Pinduoduo are usually low-income people who wanted to save money at every chance they got. Now, since the subsidies are usually for electronic products (easy to verify), people with high incomes joined Pinduoduo. This action is not simply solving problems with money. On the contrary, it helped Pinduoduo to become a major competitor in the online retailing area.
Future
No one can predict the future. Pinduoduo showed us that with flexible use of social media, it can break the old pattern. And all of this happened within only 7 years. A digital world keeps everything changing quickly.
