Pinduoduo'S Revenue In The First Quarter Was 22.167 Billion Yuan, Reinvesting In The Construction Of Agricultural Infrastructure And Logistics

On May 26, Pinduoduo released its financial report for the first quarter of 2021. The financial report shows that Pinduoduo's revenue in the first quarter was 22.167 billion yuan, up 239% year on year from 6.541 billion yuan in the same period last year. Under non general accounting standards, the platform's net loss attributable to common shareholders in the first quarter was 1.8903 billion yuan, which was 3.1696 billion yuan compared with the same period last year, significantly narrowing the net loss.

Among them, Pinduoduo's revenue growth is mainly due to the strong growth of online marketing technology service revenue. In the first quarter, the platform's online marketing technical service revenue was 14.1115 billion yuan, up 157% year on year. "As our scale continues to grow, we are more capable and more responsible to fulfill the mission of 'inclusive'." Chen Lei, Chairman and CEO of Pinduoduo, said that Pinduoduo's future is not only a platform that can promote the trade of goods and services, but also is constantly thinking about how to maximize the mobilization of resources and influence to bring more help to the society.

It is worth noting that as of March 31, 2021, the number of active buyers in Pinduoduo reached 823.8 million, a net increase of 195.7 million over the same period of the previous year, and it was ahead of other domestic e-commerce platforms for the second consecutive quarter. "Pinduoduo is committed to long-term value creation, and its expanding scale gives us both the ability and the responsibility to fulfill the mission of 'inclusive'." Chen Lei looks forward to the next five years, Pinduoduo will continue to cooperate with local governments and agricultural institutions, increase technical training for farmers, enable agricultural production with technology, and help rural revitalization.

Enter the era of 800 million users

Previously, by the end of 2020, the number of annual active buyers of Pinduoduo reached 788.4 million, surpassing Alibaba's 779 million annual active consumers. Pinduoduo became the e-commerce platform with the largest number of users in China for the first time, and became one of the domestic e-commerce giants in just six years. At the same time, the active merchants of the platform also increased from 5.1 million in 2019 to 8.6 million, with an increase of 69%.

On this basis, Pinduoduo maintained a user growth rate of more than 30% year-on-year in this quarter, and continued to expand its leading edge.

In the context of the continuous recovery of the domestic consumer market, in the first quarter of 2021, the average number of monthly active users of Pinduoduo APP reached 724.6 million, a year-on-year increase of 49% compared with 487.4 million in the same period of last year, and the monthly active/annual buyer index continued to grow, from 78% in the first quarter of 2020 to 88% in the first quarter of 2021. The user scale and viscosity both maintained rapid growth.

More and more global first-line brands choose to settle in Pinduoduo. In the last quarter, the scale of Pinduo multi platform merchants accumulated more than 8.6 million, and this quarter continued to maintain rapid growth. Pinduoduo's "10 billion subsidy" brand official flagship stores increased more than 10 times over the same period last year, of which digital appliances, beauty clothing and other brands saw the most significant growth, with more than 600 new flagship stores for small household appliance brands alone.

With the strong support of platform merchants, brand merchants, service providers and other ecological partners, the number of active users of Pinduoduo's "10 billion subsidy" channel has exceeded 100 million, and more than 10 million people buy and place orders every day, effectively meeting the needs of China's most users for a better life.

In order to meet the diverse needs of users, Pinduoduo continued to increase the subsidies and coverage for high-quality goods this quarter. In the first quarter, the platform spent 12.997.4 billion yuan on sales and marketing, up 78% from 7.2966 billion yuan in the same period last year.

At the same time, industry insiders pointed out that the rapid rise of Pinduo multi user scale can not be separated from its "10 billion subsidy" strategy. According to QuestMobile data, in the past year, the average monthly MAU of the whole network increased by 13.03 million, or 1.7%. In contrast, the average monthly active growth rate of Pinduoduo APP is 28.8 times that of the whole network.

Pinduoduo's "10 billion subsidy" strategy began in June 2019, bringing more affordable big brand goods to the largest user groups through direct subsidies on the platform. Driven by the "10 billion subsidy", the total revenue of Pinduoduo will reach 59.4919 billion yuan by 2020, up 97% year on year; The annual turnover (GMV) was 1667.6 billion yuan, up 66% year on year.

At present, the "10 billion subsidy" has become the top stream channel of Pinduo. Every day, more than 10 million people choose goods with 10 billion subsidies, covering a wide range of categories such as digital, beauty, fresh, household appliances, clothing, and so on, providing a large number of authentic brands. The scale of this promotion activity is equivalent to 142 Beijing SKP malls celebrating stores at the same time.

The 10 billion subsidy also played an obvious role as a "baton" for Pinduoduo. It is different from the temporary or seasonal promotion of e-commerce festivals such as June 18 and Double 11. It guides the commodity category structure of the platform through long-term subsidies. Behind it is the screening of business levels to guide more young users to consume through the channel of 10 billion yuan subsidies. This group is the main buyer of brand goods.

Recently, 10 billion yuan subsidy also celebrated its "second anniversary". The person in charge of Pinduoduo's 10 billion subsidy introduced that in addition to continuing to make efforts to subsidize fresh agricultural products, the 10 billion subsidy channel also opened a new "official cooperation flagship store" entrance. It is understood that the official flagship stores of brands newly settled with 10 billion yuan of subsidies have increased more than 10 times over the same period last year. More and more global first-line brands choose to settle in Pinduoduo. In the last quarter, the scale of Pinduo multi platform merchants exceeded 8.6 million in total.

Taking the category of small household appliances as an example, Pinduoduo added more than 13000 small household appliance stores in the first quarter of this year. According to the person in charge of Pinduoduo household appliance business, nearly 70% of the small household appliance brands on the market have opened flagship stores in Pinduoduo. It is expected that by the end of this year, most brands will establish a flagship store system on Pinduoduo. For big name businesses, 10 billion subsidy is a new consumption growth market. Big name businesses have found new consumption growth and provided goods to consumers who have not been touched before.

At the same time, Pinduoduo officially announced that, in order to bring consumers a better consumption experience, it will comprehensively improve the service standards of 10 billion subsidy merchants, thus refining a large number of merchants with high supply chain toughness and strong service ability. "We will subsidize whatever consumers need, which is our core value concept," said the person in charge of Pinduo's 10 billion yuan subsidy.

Re investment in agriculture and logistics

This year, fresh agricultural products have become the protagonist of the "10 billion subsidy". Pinduoduo will implement regular subsidies for fresh fruits, agricultural and sideline products, meat, poultry and eggs and other household goods.

At present, the "10 billion subsidy" has been implemented for fresh fruits, agricultural and sideline products, meat, poultry and eggs and other livelihood products. Hainan Feizixiao Litchi, Shandong Big Cherry, Enshi Small Potatoes and other fresh foods in the current season received subsidies ranging from 5-20 yuan (per jin). In addition to fresh food in the current season, imported tropical fruits such as durian and mangosteen in Thailand have been subsidized to the best price of the same kind.

"With the shift of national consumption habits to online, users' online shopping needs gradually cover all categories, and agricultural products are one of the biggest growth points. Therefore, the '10 billion subsidy' has been adjusted to cover 'rice bags' and' vegetable baskets' in an all-round way." The person in charge of Pinduo's 10 billion subsidy said.

In 2020, the GMV of Pinduoduo agricultural products will exceed 270 billion yuan, doubling the scale year on year. After the epidemic, users gradually get used to shopping online, which is a purchase behavior that does not need to spend much time cultivating.

The Report on the Development of China's Consumer Market in 2020 issued by the Research Institute of the Ministry of Commerce pointed out that under the background of new consumption leading the domestic big cycle, Pinduoduo reshaped the "Internet+agriculture+consumption" industrial chain, took the "Pinduoduo+direct distribution of production areas" as the core model, matched China's decentralized small-scale farming status quo, and created a highway "agricultural products up".

In addition, science and technology endows farmers with more bargaining power in the market. So far, Pinduoduo has directly driven more than 100000 new farmers nationwide to return to their hometown for employment, and will continue to cultivate 100000 new farmers in the next five years. Only by benefiting and enriching farmers, when more benefits return to farmers, will they be more willing to invest in sustainable agriculture.

It is worth mentioning that at the historic moment when this year's fight against poverty achieved a comprehensive victory, Pinduoduo, as the representative of Internet enterprises, was awarded the highest standard of "National Advanced Collective in Poverty Alleviation".

At the performance teleconference after the release of the financial report, Chen Lei said that Pinduoduo, as China's largest agricultural product uplink platform, is also an infrastructure platform focusing on agricultural products.

He introduced that Pinduoduo is cooperating globally to solve future food problems. Recently, Pinduoduo has cooperated with the Singapore Institute of Food and Biotechnology Innovation (SIFBI) under the Singapore Science and Technology Research Agency (A * STAR) to study the impact of plant meat on human health. The researchers of the institute will carry out a series of examinations on the subjects to analyze the effects of replacing traditional animal protein with plant protein on nutrition and health in different periods of time. This research is a pioneering research on new plant meat.

This is not the first scientific research cooperation project of Pinduoduo. Chen Lei revealed that a year ago, Pinduoduo started another agricultural research project to develop a more portable and low-cost pesticide residue detector. The project is committed to improving food safety and quality, thus benefiting many people.

At the same time, Pinduoduo is also deeply thinking and exploring the logistics information system and infrastructure. Chen Lei said that more than one third of the package volume in China last year came from Pinduoduo, and Pinduoduo has expertise in complex technical system design. "We have developed and optimized the algorithm design, data analysis and cold chain logistics, and applied for some patents. We hope to promote them in practical operation, and help logistics suppliers improve efficiency and reduce costs."

It is reported that Pinduoduo is tracking, positioning and managing the package flow more dynamically based on advanced algorithms and data analysis, and designing a logistics architecture with faster response. In 2018, Pinduoduo launched its own logistics e-face sheet system, which will become the second largest e-face sheet system in China and even the world in a short time. Since 2019, the company has further increased its investment in research and development on the logistics infrastructure. According to the information on the official website of the State Intellectual Property Office, Pinduoduo has obtained patents on the methods, devices and electronic equipment for false waybill identification, logistics effectiveness evaluation, storage interception and logistics number segment storage.

In addition, as of March 31, 2021, Pinduoduo's cash and cash equivalents and short-term investments were 83.4 billion yuan. Driven by strong revenue, the operating loss and net loss of this quarter narrowed at the same time. The financial report shows that the net loss attributable to common shareholders under non general accounting standards is 1.8903 billion yuan, which is significantly smaller than the net loss of 3.1696 billion yuan in the same period last year.

David Liu, vice president of Pinduoduo Strategy, added, "We are still focusing on serving our users and predicting what they need. We will continue to involve our users, merchants and partners in all aspects of improving our services."