[Tidal Business Review/Original] Monica from Nanjing became a loyal user of Pinduoduo during the epidemic. At the beginning, she was favored by the owners of the community. The neighbors would ask Monica if she wanted to buy fresh fruits together on Pinduoduo. Since it was diffic

[Tidal Business Review/Original]

Monica from Nanjing became a loyal user of Pinduoduo during the epidemic. At the beginning, she was favored by the owners of the community. The neighbors would ask Monica if she wanted to buy fresh fruits together on Pinduoduo. Since it was difficult to refuse the neighbors’ requests, she only wanted to give it a try. She participated in the group purchase together with her mentality, but after trying it, she unexpectedly found that the quality of the goods arrived every time was pretty good.

After comparing with other platforms, Monica found that on Pinduoduo, in addition to buying vegetables from Duoduo, there is basically nothing wrong with buying fruits from merchants marked with "tens of billions of subsidies". After developing certain consumption habits, Monica also began to choose other products with tens of billions of subsidies. This made her sigh, "Everyone laughs at Pinduoduo, but no one can escape Pinduoduo."

01 The tens of billions of subsidies have achieved remarkable results

In fact, Pinduoduo’s tens of billions of subsidies have been online for three years since its launch in June 2019, and are about to enter their fourth year of subsidies. According to the Oriental Securities research report, currently, the number of active users of the Pinduoduo "Ten Billion Subsidy" portal has exceeded 100 million, and an average of 10 million people choose products among the tens of billions of subsidy portals. The scale of this promotional activity is equivalent to 142 Beijing SKP shopping malls holding store celebrations at the same time.

From the data point of view, since the implementation of tens of billions of subsidies, Pinduoduo’s revenue and net profit have been rising rapidly. Its operating income has soared from 30.14 billion in 2019 to 93.95 billion in 2021. What is more noteworthy is that Pinduoduo Duoduo has finally achieved profitability.

In 2021, Pinduoduo’s net profit attributable to its parent company was 7.768 billion yuan. By the first quarter of 2022, Pinduoduo’s net profit attributable to its parent company was 2.6 billion yuan. There is no doubt that tens of billions of subsidies have become a strategic weapon for Pinduoduo to break out of the siege.

During this year’s 618 period, the effect of Pinduoduo’s tens of billions of subsidies was still significant. Data shows that during the 618 period, tens of billions of subsidies and joint merchants saved a total of 3 billion yuan for users who purchased mobile phones. In the continuous "real fragrance" experience, Pinduoduo has become the preferred platform for mobile phone brands and consumers to go both ways. The sales of the platform brand's official banner increased by 124% year-on-year, and the number of stores with sales exceeding 100 million has tripled.

Of course, consumers like Monica are most concerned about whether the tens of billions of subsidies can be sustained. In fact, since the end of 618 in 2019, Pinduoduo’s tens of billions of subsidies have been upgraded by the company into a long-term platform strategy, and an independent entrance has been opened in the center of the APP homepage, which continues to this day.

So, in addition to big items like digital products, in what areas will Pinduoduo’s tens of billions of subsidies be tilted towards in the future?

Let’s first look at this set of data. In Pinduoduo’s return promotion to celebrate its third anniversary of tens of billions of subsidies on May 24, during the event, the sales of imported fruits such as avocados, Thai coconuts, South African black grapes, and Australian red grapes grew rapidly. The year-on-year increase exceeded 40%, of which kiwi increased by 85%. In addition, so far, tens of billions of subsidies have covered nearly 40,000 types of agricultural products.

In other words, in the future, Monica will buy more categories of fresh food and agricultural products from the entrance with tens of billions of subsidies. From this point, it can be seen that tens of billions of subsidies are an important strategy of Pinduoduo. Its tilt towards agricultural products also reflects the company’s emphasis on helping farmers.

02 Pinduoduo helps farmers “on the road”

As an e-commerce platform that started with agricultural products, Pinduoduo has continued to invest heavily in the agricultural field, and last year invested tens of billions of profits in a row to establish the “Ten Billion Agricultural Research” project.

For agricultural products, the most important link is transportation and storage. Therefore, Pinduoduo has increased its investment in agricultural product logistics infrastructure and greatly improved the scale and efficiency of agricultural products. With the help of agricultural product infrastructure, Pinduoduo can now transport fresh produce to its warehouses in just a few hours.

In addition, Pinduoduo also focuses on building an "intelligent agricultural products processing system". Through this system, information about each production area, including geographical location, special products, maturity cycles and other information, can be input, and after calculation, various types of agricultural products can be matched within the maturity period. to consumers.

For farmers, Pinduoduo has always adhered to the "zero commission" and "shopping + direct delivery" models of agricultural products, and enhanced the brand of high-quality agricultural production areas through live broadcasts, assistance in planting and improvement of e-commerce sales standards. influence, promote stable income growth for farmers, and help rural revitalization.

has many similar samples across the country. Yang Xinhong, who was born in 1991, is a courier boy. His daily job is in the fields, finding ways for the good things in the mountains to get out, and delivering agricultural products to consumers everywhere through logistics express. In recent years, agricultural products have been sold through e-commerce, and Yang Xinhong's collection business has also increased.

Before 2020, Yang Xinhong, like all front-line courier boys, was busy collecting and delivering goods and doing business from morning to night. The "restless" Yang Xinhong found that rural e-commerce still has a lot of room for improvement, and has been trying to find a breakthrough point in this field.

"The logistics vehicles that come and go are the expectations and hopes of the villagers. They not only bring them goods from the outside world, but also allow 'local goods' to go out." Yang Xinhong secretly made up his mind to let more high-quality specialty agricultural products pass through He entered thousands of households from the fields. So he registered a personal store on Pinduoduo, and the first fruit he tried to sell was Dali Dong Zao from his hometown.

With the operating experience of Dali Dongzao, Yang Xinhong has sold peaches and apricots through Pinduoduo. At present, the hot-selling Yanliang Melon has also given him a taste of the "sweetness".

"As Pinduoduo's 'good agricultural product', Yanliang melons have excellent texture and are favored by consumers. They have sold hundreds of thousands of orders." Yang Xinhong said, "With the rise of new e-commerce, direct delivery from the origin has replaced layered distribution. , this method of upstreaming agricultural products has gradually become mainstream, which can not only shorten logistics time, but also reduce intermediate links and increase farmers’ income.”

“Yanliang muskmelon is the ‘hot product’ of the season, and a number of leading merchants have emerged, with sales even increasing. It can compete with Shandong Yangjiaomi . The leading local e-commerce company Xiyu Meinong has opened an expert account on Pinduoduo, and has received tens of billions of subsidies to promote Yanliang Melon,” said the relevant person in charge of Pinduoduo. The "Searching for Fresh China - Duoduo Good Agricultural Products" project will focus on seasons, searching for the freshest seasonal ingredients across the country to open up consumers' taste buds. As a national geographical indication agricultural product, Yanliang muskmelon was selected into the first batch of "Duoduo Good Agricultural Products" and promoted to consumers nationwide through the platform's tilted resources.

Because of this, consumers as far away as Nanjing like Monica can also eat the freshest and most affordable Yanliang melons.

So, why does Pinduoduo attach so much importance to investing in helping farmers?

03 Agriculture, Pinduoduo’s trump card

First and most obviously, continued investment in agriculture has brought considerable income returns to Pinduoduo. According to previous financial reports, Pinduoduo’s agricultural product GMV has maintained a three-digit growth rate for five consecutive years. In 2020, the GMV of its agricultural products exceeded 270 billion yuan, accounting for 16% of the total GMV.

In addition, agricultural products are in high-frequency rigid demand and are synergistic with Pinduoduo’s development. Many people seem to have forgotten that Pinduoduo’s e-commerce journey started with agricultural products.

In 2015, the Huang Zheng team came up with a group-building plan: Pinhaohao tells you that there is a cost-effective and delicious fruit. If you gather 3 or 5 people, you can buy it. Pinhaohao is the predecessor of Pinduoduo. Therefore, agriculture is Pinduoduo’s fundamentals.

Today, Pinduoduo has more than 800 million active users and has become the largest e-commerce platform for agricultural products in China. With the growth of mobile user traffic slowing down across the entire network, the low penetration rate of for agricultural products means that there are still a large number of users. room for growth.

In addition, Pinduoduo’s user characteristics also determine that the demand for agricultural products will be higher than other platforms. All along, Pinduoduo has gathered more users from “outside the Fifth Ring Road”. Users are more price-sensitive, and products with high cost performance will be more popular. Benefiting from high-quality fresh products, Pinduoduo’s user stickiness will be higher, and its repurchase rate and user activity will also increase.

Judging from the development of the platform, it will be more stable based on the agricultural products and food consumption market. In 2021, the per capita food consumption of our country's residents will account for 29.8%. The current situation where food is the most important thing for the people will bring a stable and huge market for agricultural product consumption.

Generally speaking, Pinduoduo’s high-quality development of is inseparable from Chongcang Agriculture. Agriculture is an important point of difference in Pinduoduo’s differentiation strategy. At present, Pinduoduo has truly achieved "out of the circle" in terms of helping farmers.

Therefore, it is foreseeable that in the second half of the mobile Internet, Pinduoduo’s competitive advantages will become increasingly clear, and the moat it has established in the rural e-commerce field will help its performance grow steadily.

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