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Founded in 2015, the Chinese social e-commerce platform Pinduoduo generated a revenue of around * billion yuan in 2025, increasing from * billion yuan in the previous year. A major factor in the meteoric rise of Pinduoduo was the rapid expansion of China's lower-tier market.

Pinduoduo and small-town youth in China

While the e-commerce market has been nearly saturated in China’s first and second-tier cities, small towns and cities showed their potential as a fast-growing and alluring market for those online retailers. The “sinking market” and “small-town youth” became inevitable topics for every digital marketer. “Whoever gains the small-town youth, gains the market” was the new guideline for almost all e-commerce players to set their marketing strategies. The online discounter Pinduoduo appeared as a dark horse in the competition. The majority of its users were from the third-tier cities or below, and these users were more sensitive about price.

Scandals regarding counterfeit goods

Pinduoduo went viral among small-town residents for its hard-to-believe price and many cashback actions. From high-tech products like the newest iPhone to daily necessities like toilet paper, Pinduoduo offers lower prices compared to Alibaba and JD.com. However, cheap doesn’t always mean good. In 2018, the prevalence of counterfeits on the platform brought Pinduoduo to the center of unwanted attention. In that year, Pinduoduo was investigated by the Chinese market regulators for selling fake goods, and in early 2019, it was blacklisted by the U.S. government for its violation of intellectual property rights. After that, Pinduoduo shifted its focus from driving user growth to improving user experience by attracting high-quality merchants and weeding out counterfeit goods, resulting in slower monthly active user (MAU) growth but higher penetration among middle-class consumers.