In Pinduoduo, suppliers list two prices for each item – one for individual purchase and one for team purchase. A user can either:
initiate a team purchase and encourage friends via social media to join their team or;
join an existing team purchase.
If the team is completed within 24 hours, the items are shipped at the team purchase price. If not, all participants receive refunds. The benefits of this feature are so attractive to users that nearly all Pinduoduo transactions are completed using team purchase.
Pinduodou went beyond non-perishable items into groceries under a similar model. Formally spun into its own segment called Duo Duo Grocery in August 2020, it operates in 300 Chinese cities where orders placed before 11 pm through the app are ready for collection after 4 pm the following day at selected collection points. In 2020, Pinduoduo doubled its agriculture-related Gross Merchandise Value to 270 billion yuan ($42 billion) from the year before, cementing its place as China’s largest agriculture platform.
There are a number of other ways in which the company gamifies the shopping experience:
Daily Check-Ins encourages users to login for small values of redeemable credit.
Price Chop allows users to get certain products for free by sharing a custom link with their friends. The number of friends who click on the link within 24 hours drives the discount. If the discount drives down to 0 in 24 hours, the link sharer gets the item for free.
The Card Program offers a number of different loyalty cards for users: the “Free Pass Card” enables a team purchase discount without joining a team, the “Brand Black Card” offers discounts on branded items in exchange for reviews, and the “Brand Card” which users can give away to friends so that they can receive discounts on branded goods.
The company also operates literal games: In Duo Duo Orchard, for instance, a user creates a virtual fruit tree which, when nurtured, results in the user receiving a box of fresh fruit delivered for free. Water and other essentials for this tree are generated through app activity, purchases and interactions – all of which can be shared with friends.
The gamification of online shopping experience has led to a large and dedicated customer base for the company in a country where the purchase of goods and groceries continue to be largely driven by recommendations. This has led to a higher “active” user base than Alibaba.
