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He Shuang, who grows pomegranates in the southern province of Sichuan, is the New Pinduoduo Farmer. The former flight attendant returned to his distant mountain hometown in Kunming in 2017. He initially shipped the fruit to wholesalers around China, and then sold the fruit back to consumers. After switching to Pinduoduo, it could reach consumers directly; “We created a strong and predictable demand for our products, which in turn keeps our cash flow healthy,” he says.
In a recent video, he pulled a grenade from a bush in his orchard and, “because he has no nails,” bit it on the skin to reveal its juicy seeds. Although it was rigid at first, it now shows the look of the camera. “Livestreaming is like chatting to develop trust with customers,” he says. His big sales prompted him to hire Pinduoduo video and text marketing. The warehouse staff now has 150 employees, and the annual revenue for 2019 was 40 million yuan ($ 5.7 million).
Sofya Bakhta analyst Daxue Consulting, says Pinduoduo’s group purchasing model helped unify the dispersed demand of consumers and linked these buyers to farmers, “effectively creating an enlarged national market”. This reduced the costs of farmers and gave them some of the benefits of large-scale agriculture. In the past, says Gerard Sylvester, the FAO’s head of investment, farmers often had secure demand and volatile prices. “We have seen a farmer drive his produce to market, we have seen the price of the product fall, he is much lower than the cost of production, and he throws the whole harvest out of the market so as not to pay extra cost. To return the carrier to his village,” he says.
Sylvester said Pinduoduo facilitated mobile payments through its strong logistics network and mainstream Chinese messaging system WeChat. He says Pinduoduo has raised farmers ’incomes and made it easier for them to plan, helping them create new jobs in rural areas. In August 2020, Pinduoduo introduced the Duo Duo Grocery, a next-day collection service to help farmers sell directly to local consumers.
Not all farmers are happy with Pinduoduo. Yang Lin sold 30 tons of apples a month on the platform in 2019, but says Pinduoduo “didn’t make any money,” especially after considering the ads he bought to attract consumers to the site. He believes that selling more apples could benefit Pinduoduon, but he left the starting point because that point was too elusive. Advertisements are not required. Asked about Yang’s situation, a company spokesman said Pinduoduo has “champion” farmers and is “working to improve farmers’ market access so they can sell better ”.
Other critics have said Pinduoduo and its competitors are breaking traditional sales chains to the detriment of some farmers, as these traditional networks are more balanced and inclusive than e-commerce algorithms that unfairly accept best-selling crops.
Dudarenok says the technology “is not the only answer to lift farmers out of poverty or to structurally improve their lives and businesses.” But Pinduoduo says it has provided a stable consumer base, sales channel and logistics to vendors. “Farmers and consumers earn by cutting the middle man,” he says. However, farmers need to work “for that” with live streams and to buy ads. You have to be good at catching eyeballs. ”
Bakhta says applications like Pinduoduo will not replace physical markets because China is large enough to accommodate both. The four years spent in China have led him to believe that local markets are “more than just a place to buy food”. It’s a kind of club where you can come, chat, practice negotiation skills and at the same time buy something fresh and tasty, ”he says.“ Offline stores, especially those with farm products, are part of Chinese culture. ”
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