Pinduoduo Product Analysis Report

Pinduoduo has developed rapidly since it appeared in the public eye; however, a lot of negative news was subsequently exposed, and the entire growth process attracted a lot of attention. Now that public opinion has gradually calmed down, the author calmly looks back at Pinduoduo's growth process, and combines survey data with a focus on breaking down the group-buying function to analyze Pinduoduo, hoping it will be helpful to you.

1. Product Overview

1.1. Experience environment

• Experience model: iPhone 6
• System version: ios 10.3.3
• APP version: 4.26.0
• Experiencer: PM Accumulated Notes
• Experience time: 2018.9.27

1.2. Product Introduction

Pinduoduo is an e-commerce software whose main function is to purchase goods.

Its icon, like JD.com and Tmall , uses passionate red as the main color, and the overall pattern is a heart made up of various product icons.

There are five first-level entrances on the homepage after opening, which is the same as Tmall and JD.com, but the marketing strategy and positioning are obviously different from the above two. Unlike Tmall and JD.com, Pinduoduo focuses on low prices, and its target audience is mainly people with low consumption levels.

2. Market Analysis

2.1. Industry Background

According to iResearch’s 2016 Chinese online shopping market data: In 2016, the transaction volume of China’s online shopping market was 4.7 trillion yuan, accounting for 14.2% of social consumer goods retail sales. Online shopping contributes more and more to the economy and remains the mainstream retail channel with ample room for improvement.

In 2016, mobile online shopping in China accounted for 68.2% of the total online shopping transaction volume, an increase of 22.8 percentage points over the previous year. Mobile terminals have surpassed PC terminals to become the main consumption scenario in the online shopping market. At the same time, in 2016, the growth rate of mobile terminal users of the top 10 enterprises in China's online shopping market far exceeded that of PC terminals, with the growth rate of App terminal users reaching 27.1%, while the PC terminal only grew by 9.6%.

This shows that the proportion of mobile transactions continues to expand, mobile has become the main source of traffic , and the online shopping market has entered the era of mobile consumption.

As of June 2018, the size of my country's rural Internet users was 211 million, accounting for 26.3% of the total Internet users, an increase of 2.04 million from the end of 2017, a growth rate of 1.0%; at the same time, data reports show that among China's mobile e-commerce online shopping users, 1-3 tier cities account for 54%, and 4-6 tier cities account for 26%.

Combining the above data, we can find that: although the number of Internet users in 3rd-6th tier cities is less than that in urban areas, the number is still very large and growing, and the coverage rate of mobile e-commerce business for this group of people is also relatively low, so there is broad room for development.

It can be seen that the mobile e-commerce industry has a complete industrial chain and complete infrastructure upstream and downstream:

1. The competition is extremely fierce. In addition to the old e-commerce companies that have advantages in resources and traffic, there are also new entrants that have made achievements in vertical fields. This shows that mobile e-commerce has entered the second half, and the competition in traffic and speed has shifted to refined user operations.
2. From the perspective of market concentration of mobile online shopping companies, leading companies account for more than 80% of the overall online shopping transaction volume on mobile terminals; the market size of second-tier companies still has a large gap compared with Taobao and Tmall. There are a large number of long-tail companies, and with the popularity of vertical fields such as cross-border and fresh food, a large number of start-ups are still emerging.

In general: leading mobile e-commerce companies have absolute competitive advantages, and start-ups still have certain development opportunities in exploring emerging fields and new models.

Social sharing is a new marketing method in the era of mobile e-commerce. With the explosion of mobile social networking and self-media , e-commerce is moving towards decentralization.

The new model is different from the centralized model of traditional e-commerce companies that gather all merchants and traffic through one platform. The decentralized e-commerce model is based on mobile social platforms such as Weibo and WeChat , and acquires users through sharing and dissemination through other models such as the fan economy of self-media. Consumers' purchasing needs can be stimulated at any time in people's fragmented social scenarios.

Big data will become the core driving engine of mobile e-commerce, improving marketing and operational efficiency. The U.S. Internet Data Center points out that the data on the Internet grows by 50% each year, and the growth rate is still gradually increasing.

As Internet computing and processing technologies mature, big data has begun to be applied to all walks of life. As the traffic dividend of mobile e-commerce is gradually lost, big data will become a new profit driving point, accurately matching supply and demand information, personalizing recommendations, predicting user preferences, optimizing pages, and improving operational efficiency.

2.2. Pinduoduo Market Analysis

The above are the data statistics of shopping app rankings from iResearch, Qimai Data, Chan Master and "Curiosity Data". It can be found that in various rankings, Pinduoduo ranks very high, close to the old e-commerce companies. Today's app downloads and monthly active users have shown excellent results.

3. User and Functional Requirements Analysis

3.1. User portraits and their classification

Where do users with “super low price” shopping behavior preference come from? What are the specific characteristics?

From the data monitored by iResearch, we can see some distributions in terms of gender, region and age:

From the above figure, we can see that: the number of female Pinduoduo users is three times that of male users, and young talents under the age of 35 account for more than 80%. It can be seen that the largest user group is young women, followed by middle-aged women aged 36-40.

From the data, we can find that Pinduoduo's users are relatively scattered. Although users are still mainly concentrated in developed cities with relatively high population density, those economically underdeveloped regions also make significant contributions. A research report shows that compared with shopping platforms such as JD.com, Pinduoduo has a larger proportion of users in third-tier and lower cities.

Based on the above information, it can be estimated that Pinduoduo's users include the following groups:

(1) Housewife

They are what people often call aunts and uncles. Price is the most important factor for them in choosing goods. They have neither the time nor the ability to pay attention to the quality of the goods.

In addition, they have relatively more free time and high group intimacy. If a product can gain the favor of one of them, then this product will spread wildly among them in a short period of time. The products they consume are mostly low-end products.

(2) Young people who have just started working

They often don't have much savings, have just started working and have a relatively low earning capacity, but have many places where they need to spend money. Although price is not the only consideration for them, it is also an important reference. They will not use Pinduoduo as their main shopping platform, but they don’t mind buying low-priced items when they see them.

(3) Student groups

The student group is at the age in their life when they have the strongest consumption desire but also the least. For them, the temptation of low prices is also very strong. In addition, students are very group-oriented, so it is relatively easy for them to do things like group buying. Therefore, they also account for a certain proportion of Pinduoduo's users.

(4) Retired elderly people

Their knowledge of e-commerce shopping is limited, and they find it difficult to distinguish the quality of goods. Their biggest advantage is their endless time. For them, it is worthwhile to spend a lot of time on Pinduoduo and spend a little less money, because they don’t have a lot of things to do. Pinduoduo not only benefits them but also gives them something to do, so it naturally wins their favor.

Pinduoduo has a wide user base and a huge number of users. Although users have different ages, occupations, genders and other characteristics, there are many similarities and differences in their behaviors on Pinduoduo.

Although characteristics such as age, occupation, and gender are important, the commonalities and differences in behavior are the key, because the commonalities and differences in behavior are the basis for guiding us in the design of basic functions.

Here I make the following classification:

Different types of users have different behavior patterns:

We have classified typical users with different behavior patterns, so that the subsequent behavior analysis can deduce their main specific behaviors based on the behavior patterns; with the specific behaviors, we know what functions the app needs to provide to users to support these specific behaviors.

After determining the functional needs, we can combine the current technology and environmental conditions to determine which functions need to be implemented in the app, thereby determining the functional scope of the entire app.

3.2. Inferring User Behavior from User Classification

As can be seen from the figure, the biggest difference among the specific behaviors of different users is how they find their favorite products:

(1) For users with clear goals

The first choice is to use the search function, which is the fastest and most efficient. The second choice is to search for the desired product level by level through the navigation bar.

(2) For users with unclear goals

They are most likely to use navigation to find all products under a certain category. At the same time, because their goals are not clear enough, they are easily attracted by other attractive sections with features/low prices, and then browse and view them.

For example, if A has just moved into a new house and is planning to buy a lot of daily necessities, the most likely method he will use is to click on the daily necessities tab in the navigation bar to view all subcategories and then determine what all the goods he needs to buy are, thus taking into account both comprehensiveness and efficiency.

Secondly, they will use the search function to search. At the same time, because their target is vague, they are easily attracted by modules that are easy to attract attention, such as "hot product recommendations" and " brand hall". They expect to find products in these special channels that can not only meet their current needs, but also be more cost-effective or cheaper.

(3) For users without a goal

The purpose is to kill boring time in the hope of discovering some interesting, useful or cheaper goods (good quality/low price). Since this type of users currently have no demand, the app needs to design sections that can stimulate users' desire to buy and stimulate users to generate demand.

3.3. Deriving functional requirements from user behavior

It can be seen from the above figure that the difficulty of meeting the needs of users with clear goals, users with vague goals, and users wandering around aimlessly increases in sequence.

• In addition to basic search and category navigation functions, it is also necessary to add special modules (novelty) and promotional activities (discounts) to better attract users with unclear shopping goals and no goals to browse more deeply, stimulate demand, and stimulate consumption.
• In addition, in order to provide users with comprehensive and easy-to-search product information, it is necessary to provide filtering and sorting, product details, user reviews, and customer service functions. The collection and shopping cart functions are convenient for users to view and compare alternative/to-be-purchased products.
• The final decision-making behavior: placing an order. In view of Pinduoduo’s positioning of itself as a “group purchase”, the order here can be changed to placing an order + group purchase.
• In addition, there is another scenario: users need to check the details of their orders, logistics information, personal addresses, personal accounts and other personal information. Therefore, a "Personal Center" module is added to meet the needs of such scenarios.
• Finally, combined with Pinduoduo's positioning of itself: "Users initiate group orders with friends, family, neighbors, etc., Pinduoduo understands consumers through group orders, and makes accurate recommendations and matches through machine algorithms, allowing users to buy better things at a lower price", so it is necessary to add a "personalized product recommendation function".

Therefore, common functional requirements include:

1. Search Function
2. Category navigation function
3. Featured module functions
4. Promotional features
5. Filter and sort functions
6. Product details function
7. Product review function
8. Personalized product recommendation function
9. Customer service function
10. Collection function
11. Shopping cart function
12. Order + group purchase function
13. Personal Center

Combined with the analysis of user portraits in the previous article, it can be concluded that Pinduoduo's users are very sensitive to prices. At the same time, combined with Pinduoduo's own positioning, it can be seen that among all the functions of the APP, the promotion module, the group buying function and the personalized product recommendation function should be the focus of design.

4. App Analysis

4.1. Product objectives

Pinduoduo's official positioning of itself is: Pinduoduo, a new e-commerce pioneer, is the mainstream mobile shopping app in China.

Users initiate group buying with friends, family, neighbors, etc., and Pinduoduo gets to know consumers through group buying. It makes accurate recommendations and matches through machine algorithms, allowing users to buy better things at lower prices and experience more benefits and fun.

Let’s take a look at the entire e-commerce market. As the e-commerce market gradually becomes saturated, how to better meet users’ aimless browsing needs, increase users’ usage time, and improve users’ ordering rate has become a top priority.

In addition to the usual promotional activities, Taobao, JD.com and other major e-commerce platforms are working hard to build scenario-based channels, create video, graphic and other content, segment user scenario needs and refine operations by relying on personalized recommendation algorithms that are tailored to each individual.

In contrast, Pinduoduo's approach is very different.

If other e-commerce companies use user interest preferences to guide users to place orders, Pinduoduo uses low-priced hot-selling products to guide users to place orders. As long as the temptation of low prices is strong enough, the disadvantage of poor precision in product recommendations becomes very small - if the user's threshold is low enough, the user interest preferences that need to be satisfied to cross this threshold are simple enough.

Pinduoduo's basic shopping guide method is roughly as follows: category tab + product recommendation. It uses the category tab to do simple user demand screening, and then promotes users' purchasing desire through low-priced recommended products.

Functional analysis

4.2.1 Add group buying function

Combined with the common function analysis results above, it can be found that Pinduoduo has added a group buying function. This is the soul of Pinduoduo's "social + e-commerce". The supporting social operation strategy is also an important factor in its rapid rise. Next, I will analyze this function and the corresponding operation plan .

Introduction to group buying mode:

Each product has an individual purchase price and a group purchase price. Select group purchase to place an order for the product. After the group payment is successful, you will get the forwarding link and invite your friends to join the group. Group members can also share the group to invite more members to join. If the corresponding number of people are invited to pay for the purchase within the specified time, the group purchase is successful and you can wait for delivery.

If the number of participants is not reached, the group purchase will fail and the system will automatically refund the money to the payment account.

The following figure shows the group process:

Specific operation methods of group buying:

After repeated experience, I divide the group buying operation methods of Pinduoduo platform into four categories:

1. Go directly to the group;
2. Invite to participate in group buying;
3. Invite help: bargain for free, group leader for free, help to enjoy free bill;
4. Sharing and reciprocity: cash sign-in, share and receive red envelopes.

Among them, "sharing" is the core of the group buying model and the soul interaction of social e-commerce. It determines many key indicators of the platform. The success of sharing directly affects the effect of viral transmission . At the same time, it can also improve advertising value (i.e. increase user brand awareness and functional experience through repeated exposure) and traffic conversion value (registration or order conversion, and conversion of being guided to use the same function or purchase goods).

Obviously, the second method, inviting people to participate in group buying, can directly lead to order conversion and can directly play a role in attracting new customers and promoting activation. The third and fourth methods can mainly reflect the advertising value and attract new customers.

Next, the method is introduced:

(1) Bargain and get it for free

A typical sharing and assistance model. After you share the selected products, your friends can help you bargain down to 0 yuan and finally get the products for free by clicking the bargaining button in H5 or APP (there will be more bargaining in APP). This is most common in our Moments and group chats. It can help with advertising exposure and viral spread, and ultimately lead to certain new conversions.

(2) The leader can get it for free

This is a lottery group model. After initiating a 0 yuan group purchase, you invite friends to join the group. When the number of people who join the group reaches a certain level, the group leader and a random member can get the goods. This is an optimized form of the early " one yuan purchase ".

The social threshold of this model is relatively low, because friends also have a certain probability of obtaining the goods. In addition, the lottery group itself is quite interesting, and can play a good leverage role in attracting new customers and increasing user activity.

(3) Help to enjoy free orders

A typical friend-assistance model: after placing an order for free, share the QR code with friends. Your assistance is successful when your friends download the APP and log in to WeChat through the QR code. When a certain number of people are reached, you can enjoy a free order. This model has a high threshold for friend operations and is mainly targeted at sharing with individuals. It has a high social threshold, but it can bring certainty in APP new user conversions.

(4) Cash sign-in and sharing to receive red envelopes

It is essentially a sharing and rewarding model, and the steps include signing in, receiving cash sharing, signing in group sharing, and withdrawing cash when the amount reaches a certain limit.

In this gameplay, cash or red envelopes are both good incentives, and it incorporates two sharing methods. One does not require the participation of friends, and you can get red envelopes by signing in and sharing every day, which plays a role in promoting activation and retention ; the other requires friends to join the group, which is the same friend assistance mode mentioned above.

In general: this method is too long and naturally targets users at the bottom of price discrimination who have a lot of free time in exchange for small discounts with low certainty.

Advantages of group buying:

Traditional group buying platforms such as Meituan , Baidu Nuomi , and Lashou.com enjoy low prices without any restrictions on the number of people. The price is the same for one person and 100 people, and consumers have no way of knowing whether the price is really low. Simply put, it is a long-term discount sales.

Group buying seems to better reflect the original connotation of group buying: the number of buyers reaches a certain numerical advantage, the seller's price is attractive enough, buyers and sellers are attracted to each other, and finally the transaction is completed. This is in line with our old saying: "There is strength in numbers."

In the process of group buying, consumers will form a self-media in order to reach the number of group buyers, and consciously help merchants promote the products , forming a viral effect that traditional group buying does not have, and this is the significance of group buying.

The core competitiveness of group buying is "social e-commerce + group buying profit sharing", which also generates external marketing during the dissemination process, thus killing two birds with one stone.

Most of the merchants chosen by Pinduoduo are the sources of goods and merchants who have opened Taobao stores, so that they can obtain the greatest price advantage. Guide users to share on the purchase interface. Group buying is completed through sharing, and platform marketing is achieved in the process of sharing.

From this we can see that group buying requires two factors: one is to be able to attract customers with price, and the other is to have a large enough social platform to provide sharing.

Currently, Pinduoduo relies on WeChat (social), and its low entry fee attracts upstream sellers (low prices), which happens to meet these two conditions.

Disadvantages of group buying:

• Due to its own limitations, I think it is difficult for group buying to reach the level of Taobao and JD.com. If the consumption habit of group buying can be formed in a short period of time, it can also bring huge traffic to the e-commerce platform.
• WeChat (social networking) + group buying (e-commerce) is more suitable for small-amount, high-frequency commodity transactions. Most of them are fruits, dried fruits, cosmetics, and consumables in daily life.
• Group buying is only suitable for this type of goods, because the amount is small and it is easier to generate orders.
• It is very likely that group buying will end up in a situation where no one will cooperate after all the acquaintances around you have shared. From a social perspective, if someone repeatedly fails to join a group, it may not only lead to the failure of the group, but also cause the deterioration of social relationships.

Improvement suggestions:

In the later stage, shortening the operation path, increasing the benefits of friends, and finding a new balance between the interests of platform advertising to attract new users and the benefits to users and friends will be an important demand.

In addition, it is also an important idea to differentiate and refine product selection based on the characteristics of this group. After all, high-frequency and urgently needed consumables, coupled with discounts, can still give consumers a primitive stimulation.

4.2.2 Cancel the shopping cart function

Combined with the common function analysis results above, it can be found that Pinduoduo has cancelled the shopping cart function. This is the choice made by Pinduoduo based on its own product goals.

In traditional e-commerce apps, the shopping cart function includes collection and promotion functions.

Favorites: Some users like to use the shopping cart as a favorite and put many products they like directly into the shopping cart.

Promotion: Traditional e-commerce apps often have promotional activities, such as discounts, gifts, and returns. The rules of this type of promotion can be seen on the product details page. However, on the product details page, users basically cannot figure out whether the currently purchased products meet the requirements of this promotion. At this time, it is necessary to remind users in the shopping cart.

In contrast, Pinduoduo positions itself as "allowing users to buy better things at lower prices."

In the app store, you can find that the prices of its products are relatively low. Statistics show that the best-selling products in all categories on Pinduoduo are far lower than those on JD.com and Taobao. At the same time, by observing the shops, we found that many merchants only have a single-digit number of products.

Based on the above situation, it can be inferred that some of Pinduoduo's merchants join Pinduoduo in order to clear out their leftover goods at a low price. These merchants are the same as most merchants on the platform. Their prices are already cheap enough, and they will not hold discount activities. Therefore, Pinduoduo will not use the shopping cart function.

At the same time, you can find that: super low prices combined with free shipping on the entire APP and no shopping cart, are all designed to encourage users to buy when they see low prices, thus shortening the user's decision-making time as much as possible.

This is similar to the Prime membership and "one-click ordering" that Amazon has promoted for many years: low prices, free shipping, and users don't need to think too much, just click to place an order. This has formed a shopping habit among Pinduoduo users with high consumption frequency and low order value.

4.2.3 Join Duoduo Orchard

The profit-driven nature of the social chain ultimately leads to user-driven customer acquisition, with drops of water feeding the big tree. Water drops are the only currency standard of Duoduo Orchard, so how to obtain water drops is the top priority in product design.

The current ways to obtain water droplets are: inviting more people to become friends to steal energy/ordering designated products to get energy/sharing designated pages to get energy.

At the same time, giving water drops timeliness and combining it with push notifications creates scarcity of water drops and a sense of urgency for users. Threshold-free operations + task-based systems induce users to take action. What is consumed is time, but what is gained is real fruit, which is very attractive to users who have plenty of time but are concerned about price.

4.3. Information architecture analysis

4.3.1 Place duplicate functions on the home page

On the homepage, the top navigation bar covers almost all subcategories. However, some icons in the navigation bar in the middle of the homepage overlap with the contents of the tab above, so that the icons in the middle must be swiped once to browse them all. This not only makes the structure look confusing, but also reduces the display efficiency of the homepage.

4.3.2 Search function is placed at the bottom

The search function of general e-commerce apps is located at the top of the homepage, encouraging users to find products quickly and efficiently through search.

Pinduoduo places the search function at the bottom, weakening the search function. This decision is in line with its positioning. It does not want to be a traditional e-commerce platform, but an e-commerce platform that provides suitable products and high cost-effectiveness to suitable users.

By using the data of users browsing and searching for products, the algorithm can understand users’ preferences and actively recommend products, allowing products to find people instead of people finding products through search engines . When the platform knows which people like which products, it can also provide manufacturers with accurate data, produce on demand, and determine production based on sales. In this way, it can reduce production and warehousing costs and empower the supply chain.

4.4. Interactive interface analysis

4.4.1 Modify the icon to attract users

When you open Taobao, JD.com, Pinduoduo and Suning.com , you will feel that the pages are similar, full of flash sales and special offers, which will dazzle users. Only by making the parts that need users' attention distinctive can you attract users.

For example: when you open Meitu XiuXiu , will you be attracted by the dynamic pattern at the first time? Maybe you will subconsciously forget why you opened this APP and click on the dynamic pattern to find out.

Let me give you another example: When you use your iPhone, do you have to delete the accumulated unread messages, otherwise it will feel like a knot in your mind?

Pinduoduo takes advantage of these user psychology and uses dynamic GIFs and labels to modify the icon to attract users' attention. While attracting users, it also forces users to click, ultimately achieving its goal.

4.4.2 Making good use of herd mentality

Imagine a scenario: there is a long queue at an offline Heytea store . Would you subconsciously want to try the taste of this store? If your companion asks you if you want to try it together, will you also obediently queue up?

Another scenario: When we are shopping and are hesitating whether to buy a product, what would you do? Do you check the sales data, user ratings, photos and number of positive reviews?

This information will continue to reinforce your cognition and subconsciously tell you that placing an order would be a correct decision.

In fact, this is the herd mentality, and Pinduoduo also took advantage of it.

The scroll bar on the first screen displays user shopping information: who successfully formed a group for which product and when. Your subconscious mind is telling you that it is indeed Pinduoduo that 300 million people are competing for, and that someone is successfully group shopping every moment.

The waterfall flow displays products and guides customers in the form of "price + order quantity + user avatar". Low prices stimulate users, successful numbers guarantee sales, and user avatars provide authenticity and reliability.

4.4.3 Making good use of scarcity psychology

Everyone has a scarcity mentality.

It is precisely this mentality that makes Pinduoduo create a sense of urgency among users.

The countdown that can be seen everywhere in Pinduoduo is telling users one message: the favorable prices will not wait for you, and the task that is almost completed will soon start from scratch, so what are you waiting for?

The countdown for discounted prices and the countdown for new user red envelopes on the product details page are all telling users that these red envelopes are indeed free, but they will disappear immediately if you don’t use them. There are still people placing orders with you now, but after this period of time, these products may not be available.

4.4.4 Interface navigation design

In traditional e-commerce software, category navigation is generally a secondary page that requires users to click once on the homepage before entering. Pinduoduo is different. Its category tab is a fixed top navigation bar, and users can switch tabs by swiping left or right.

The category tab page under the secondary category is a list of recommended products. There is no filtering function, and users can only scroll down.

The main purpose of the above two links is to use a streamlined design to create a scene where users feel like they are shopping in a low-priced hypermarket, attracting users to scroll down and browse the product recommendation page, and finally attracting users to click into the product details page.

The core purpose of the subsequent page design is to guide users to place orders quickly. The purchase bar at the bottom of the product details page displays two buttons: individual purchase and group purchase. A higher price is set for individual purchases, and the user's desire to get a bargain is used to guide users to initiate group purchases.

V. Development Dilemma and Suggestions

We might as well classify Pinduoduo's model as a low-price strategy + social fission gameplay. These two factors made Pinduoduo successful, but also caused Pinduoduo to be stuck in a quagmire today.

5.1. Dilemma

(1) The low-price strategy led Pinduoduo to take over the low-end supply chain

The ensuing problems of fake, knockoff and inferior goods have become Pinduoduo's biggest pain.

For counterfeit goods, the platform can adopt strict audits and severe punishments to rectify them; for copycat goods, it can adopt a two-pronged approach of rectification and guidance; but for inferior goods, it is subject to the production capacity of small and medium-sized businesses themselves, and it is not something that the platform can quickly resolve in a short period of time.

This is bound to become a difficult problem that Pinduoduo cannot avoid on its development path - will Pinduoduo repeat the same pitfalls that Taobao has fallen into, or will it find another way?

(2) Relying on the huge traffic benefits of WeChat, the social fission gameplay has allowed Pinduoduo's traffic to increase exponentially, but it has also laid hidden dangers.

First, these gameplays are still mainly unilateral profit-making rather than mutually beneficial. In essence, they consume the social currency of the initiator, and their viral spread has also caused trouble for many users. Second, their gameplay introduces many advantages of game play, but also brings a major disadvantage of game play - it is difficult to ensure long-term vitality.

The attractiveness of constant rewards to users will decrease rapidly as the frequency of use increases. This forces the continuous updating, iteration and creation of gameplay to create novelty and varied rewards for users.

5.2. Recommendations

Based on the author's investigation, the following suggestions are made:

(1) Promote the upgrading of low-end supply chains through C2B

The supply chain of small and medium-sized manufacturers is the foundation of Pinduoduo's success, but it also hinders Pinduoduo's further upgrading. Mastering the supply chain is the core moat of e-commerce.

Pinduoduo’s breakthrough in the supply chain should be to strive to develop the C2B model. The so-called C2B means gathering consumer demands on the consumer side and then conducting batch customization on the supplier side. This will help small manufacturers in the original low-end supply chain to achieve excellence in single products.

This can be seen as Pinduoduo's unique form of empowering the supply chain, and also a more appropriate way for Pinduoduo to guide small and medium-sized manufacturers to upgrade.

The author believes that Pinduoduo’s main supply chain in the future may be in the form of one or several super-strong products corresponding to one manufacturer. Of course, the introduction of high-end suppliers and brand owners should also be promoted, but with the huge mountains of Alibaba and JD.com in front, and their conflict with the group buying method of the main site, it may be a more difficult problem to solve.

(2) Add more game play methods to reduce the intensity of social fission

As product coverage increases, the cost of attracting new customers will become higher and higher. Next, Pinduoduo should consider more about how to activate and retain users.

On the other hand, social fission gameplay consumes a lot of users' social currency, and its target user group is users with lower social currency value.

However, as the user group expands, how to meet the demand of user groups with higher social currency value is also a question worth considering. Introducing more social gameplay with shorter sharing paths, or gameplay with weak sharing but emphasis on in-site interaction, may be a feasible approach.

Source: Insight into the Future