Cloin Huang was a worker at Google, working on the early search of algorithms for e-commerce. He started on establishing three companies before Pinduoduo in September 2015.
Now, he is the youngest self-made billionaire according to Bloomberg. With a net worth of $9.89 billion, Huang is the 13th richest people in China. And his richness is mainly in relation with Pinduoduo.
By the first quarter of 2019, the platform has 289.7 million monthly active users (MAU). The number makes it the second most popular e-commerce platform in China after TaoBao.
In 2018, it went public on Nasdaq, only three years after it’s establishment. At the time, it has $19 IPO price and succeeded in raising $1.6 billion. It is one of the biggest IPOs of 2018.
So what puts Pinduoduo apart from other e-commerce? How did it grow this fast?
The answer is as simply as strategic market choose. Instead of focusing on large cities where e-commerce has had a deep roots, it focused on more rular areas.
Since the beginning, Pinduoduo targets people living in the rural areas that just recently introduced to the internet and smartphones. And most of them are households with lower income and educational levels whose lives revolves around bargains.
The company also has another smart strategy using the country’s most popular social media. It gives discounts through WeChat and QQ.
Both customers and sellers can share their products on their WeChat and QQ account. They can also share it on the group chat. The more purchase made through the share, the more discounts the sharer get. It is an efficient, easy, free and powerful marketing strategy for the sellers.
In the first quarter of 2019, Pinduoduo has to admit loss of its’ stock price. This is after the company reported a 6 times year-on-year loss in the beginning of the year. The lost is due to excessive cost on higher promotional expenses.
