About Temu ( Pindoudou)
Pinduoduo enters the United States with its Temu platform
Pinduoduo was born to facilitate the trade of agricultural products. Now it opens to other sectors, such as clothing, with ultra-low prices
02.11.2022.- On August 29, Pinduoduo -one of the great Chinese companies, born in the agricultural sector, but which may soon compete with Shein in the fashion sector- presented its financial results for the second quarter and the accrued for the first half of the year.
Total revenue during that quarter reached almost 15,000 million dollars, 36% more than in the same period of 2021. Operating profit stood at 1,300 million, 335% more than in 2021.
During this quarter – commented Lei Chen, president and CEO of the company – we have seen a certain recovery in consumer confidence, who have shown their resilience in the face of difficulties. We will continue to build our platform for the benefit of all.
Jun Liu, its financial manager, added: the delay of some projects and the reduction of expenses have favored us. We will continue to invest, especially in the areas of agriculture and R&D, to continue serving our customers better.
André Zhu, vice president of Pinduoduo (photo Efe), with the company’s logo on the wall
History and profile of Pinduoduo
Pinduoduo was founded in 2015 by Colin Huang, a brilliant Chinese computer scientist who studied in the United States, where he started working at Google. In 2018 he managed to enter the Nasdaq.
Born in the agricultural sector, it is currently one of the Chinese giants of e-commerce, with millions of users. It is one of the most important platforms, only after Tmall and JD.com. It connects millions of agricultural producers with consumers across China. It does, however, aim to bring more businesses and consumers from other sectors into the digital economy so that local communities can benefit from the increased productivity and convenience it offers.
Currently it is still the largest Chinese online market for agricultural products. However, it has begun to spread to other sectors, such as clothing, for which it has created the Temu application, which sells ultra-cheap garments, with many new items every day.
In fact, Pinduoduo is a combination of a social network, e-commerce of very cheap items, and a gaming app. Financial analysts value it at more than $130 billion.
Despite its great success, it is still not profitable. During the second quarter of the year it lost 210 million dollars. While Alibaba and JD compete for wealthy customers in China’s major urban centers, Pinduoduo has focused on low-income users who can find products to match their low purchasing power. Its success seems to be due to the choice of this market niche and the intensive use of technology and social networks.
Temu, in the footsteps of Shein
Children’s clothing offered by Temu, from Pinduoduo
Pinduoduo has even launched Temu in the United States, with a model that seems to be inspired by Shein’s, with a wide variety of items: from clothing and household products to pet supplies, all at very low prices. In it you can find dresses for 6 dollars or sneakers for 10.
Since you sell products from China, shipping to customers takes 7-15 business days and costs $2.99 for orders under $49. For now, returns are free. Many product categories do not yet have subcategories and others have very few products.
To attract customers, it has launched a sales campaign, offering a 30% discount coupon. It is a suitable strategy, since one of the main challenges it faces is to make itself known and build a reputation to compete with Amazon.
The presentation of the company on its website indicates to its customers -among other things- the following: Discover a wide range of global products at incredible prices. Find new products, from fashion to jewelry to home decor and more. No matter the occasion, you can always count on Temu to have the right things to brighten your life and help you live the way you want to live.
We want to enable small and midsize merchants to reach their growth potential through us. Building on our extensive supply chain and technology, we are creating a vibrant new community that connects our buyers and merchants with customers.