INSUBCONTINENT EXCLUSIVE:
Alibaba and JD.com have been in a war over the Chinese e-commerce space for a decade or so, but a third player called Pinduoduo has
managed to shake up the duopoly in recent times
The startup, which was founded in 2015 by an ex-Googler and went public on the Nasdaq last July, has further flexed muscles during the
recent &6/18& shopping spree.
According to data provider QuestMobile, Pinduoduo daily active users have outnumbered JD for at least the past
12 months, and it came out of the mid-year sales festival — first popularized by JD as a counterpart to archrival Alibaba &11/11& shopping
day — with 135 million DAUs.
JD, in comparison, ended with 88 million DAUs and Alibaba Taobao retained its top spot at 299 million
That result further solidified Pinduoduo position as China second-biggest ecommerce company by number of users.
The boom of Pinduoduo is in
part attributable to ties with its investor Tencent — also a backer of JD — which enables it to sell via WeChat lite app and tap the
giant vast social network
Alibaba, on the other hand, has for years been prevented from selling through WeChat.
In terms of sales, Pinduoduo still remains some miles
behind JD, which focuses on large-ticket items like home appliances and targets China urban, deep-pocketed shoppers
Pinduoduo took a more rural tack and has built a reputation for hawking ultra-cheap goods at small-city consumers.
In 2018, Pinduoduo racked
up 471.6 billion yuan ($68.6 billion) in gross merchandise volume, a somewhat problematic term for gauging sales as it totals the value of
orders placed, regardless of whether they are actually sold, delivered or returned
(Alibaba stopped revealing GMV a few years ago.) JD GMV was almost four times that of Pinduoduo at 1.68 trillion yuan ($243.9 billion) last
year.
One has to keep in mind that JD is a 21-year-old firm born out of the PC era, whereas Pinduoduo has been up and running on mobile for
The startup continued growth is undeniable
In a March report, investment bank UBS Evidence Labpredicted that Pinduoduo could overtake JD in GMV as early as 2021.
But Pinduoduo story
Currently trading at $20.54, its stock has plunged about 35 percent since a March high
The online marketplace has also been chided for selling counterfeits and subpar goods, an endemic problem that long plagued Chinese
This year Pinduoduo was put on the U.S
government ¬orious& blacklist alongside rival Alibaba for selling fakes, while the company claims it actively working to root out
