By the end of 2020, Pindo had 788.4 million annual active buyers, surpassing Alibaba’s 779 million. Founded only five years ago, Pindo has already become a challenger to Alibaba and Jingdong’s position in China’s online consumer market.
Pindo, an e-commerce App that turns discount shopping into an online game, has now surpassed Alibaba as the most popular online shopping platform in China.
The Wall Street Journal reported on March 22 that Poundworld pioneered the social e-commerce format in China, combining shopping with social media and positioning itself as an online hybrid of Costco and disney, turning shopping into a game.
On the Poundland platform, users are like shopping at a mall online, usually browsing randomly and without a specific shopping plan.
Poundworld allows friends and strangers to get together and shop individually or in groups at discounted prices. Socializing first, then shopping, friends gather on Pondo to play built-in games while watching live streams, sharing bargains, and shopping together.
One popular game is “Duoduo Orchard,” where players can cultivate virtual fruit trees to receive real prizes such as shopping coupons and mangoes, and win praise from friends.
Li Wenjun, a 19-year-old from Pingdingshan in central China, is fascinated by the digital orchard, she said, “mainly because it’s fun to do something with friends.”
Poundland’s chief executive officer (CEO) Chen Lei said Poundland has captured the shift from search to browsing to win business opportunities. Chen Lei was previously chief financial officer of Poundland and replaced Huang Zheng as CEO last year.
Poundland’s shares fell about 11% in the premarket last Friday (March 12) after news of Huang Zheng’s departure last Wednesday (March 17), when he handed over the chairmanship to Chen Lei.
Poundland’s Nasdaq-listed stock has risen sharply over the past year, and has surpassed rival Jingdong’s market value, which peaked at around $250 billion in February. Huang Zheng, 41, has a personal fortune of $69 billion, ranking him third on China’s rich list, ahead of Alibaba founder Jack Ma, according to Shanghai-based research firm Hurun Bafu.
Chen Lei said Poundland’s plan is to continue to spend its revenue on subsidies until it replaces Alibaba as the shopping platform of choice for perhaps 1 billion Chinese consumers.
However, Poundland’s strategy of taking over the market with the help of subsidies has recently come under criticism, with regulators saying the practice disrupts the market and harms consumers’ interests.
In addition, there is a downside to Poundland’s game-driven route, with most consumers not spending much. For example, Wenjun Li mainly uses Poundland to buy cheap snacks and packaged tissues.In 2020, the average Poundland user spent $324. This number is already increasing, but it is still less than a quarter of the average spending of Alibaba users.
To close the gap, Poundland is focusing on growing its fresh Food business, a business that currently contributes 15% to Poundland’s total revenue.
Cathy Shen, a Poundland user from the eastern Chinese city of Anqing, said Poundland has disrupted the original landscape of China’s e-commerce market, driving competitors to also trade subsidies and deals for market share.
She said, “It’s now a big melee of tech giants.”
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