Pinduoduo’s Zero Commission Policy

Pinduoduo Inc. deepened its agricultural digital inclusion efforts in 2021, spreading the benefits of the digital economy by connecting communities and facilitating the adoption of technology. As of the end of 2021, Pinduoduo has connected over 16 million farmers to its 868.7 million buyers nationwide. A total of 61 billion orders were placed on the platform in 2021, representing a 59% increase from a year ago, driven by surging agricultural orders.

In 2021, Pinduoduo stepped up its efforts to support agricultural modernization through initiatives to help farmers expand market access, motivate more young people to take up agriculture, and advance the use of technology in agriculture. Agricultural e-commerce has broadened the channels through which farmers can sell their produce, giving them access to a much bigger pool of buyers. This ability to connect directly to consumers also means higher earnings for farmers.

Throughout last year, Pinduoduo initiated agriculture-focused shopping festivals with different regions to promote thousands of local specialties. Pinduoduo also worked with key partners such as China Central Television to launch livestreaming events, introducing agricultural treasures in different areas to nationwide audiences. To support the efforts in upgrading agriculture, Pinduoduo has waived its sales commission and provided more exposure to agricultural products. The Company also pledged to continue its “zero commission policy” on agricultural products.

Further upstream, Pinduoduo invests in agricultural technology to help growers improve their productivity. Technologies developed during the first Smart Agriculture Competition is currently in use in several major strawberry-growing regions in China, including Liaoning, Anhui, and Yunnan, to manage growing conditions in greenhouses. Traditional growers can more than double their management capacity using the technologies, which determine the optimal climate conditions for strawberries and automate processes like irrigation.

Early indications from the current Smart Agriculture Competition, which began last summer, also show much higher yields for tomatoes than traditional growing methods, demonstrating the potential economic and environmental benefits of technology in agriculture.

As of the end of October 2021, more than 126,000 young farming professionals born after 1995 have joined the Pinduoduo platform, up from 85,700 in 2020 and 29,700 in 2019. These “New Farmers” have a key role to play in agricultural modernization and rural vitalization. Pinduoduo promises to devote more resources to expand its agricultural training programs and support more young agricultural entrepreneurs. In 2021, the Company made a strategic shift toward research and development and put more emphasis on agricultural technology.

Published by:

Dr. Oliver Everling

Independent since 1998, he is Managing Director of RATING EVIDENCE GmbH. As visiting professor of Capital University of Economics and Business in Beijing, former chairman of the supervisory board of a rating agency, advisory board member, advisor, member of rating committees, chairman of ISO-TC Rating Services, author or publisher of books and a magazine, Independent Non-Executive Director under EU Regulation on Credit Rating Agencies, he has been or is involved in ratings from a variety of perspectives. Previously, he was for 6 years department director at Dresdner Bank and, until 1993, managing director of the Projektgesellschaft Rating mbH after a doctorate at the banking and stock exchange seminar of the University of Cologne.

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