A large number of sellers have applied to join! Pinduoduo has fired its first shot in going overseas

Pinduoduo's first overseas destination is the United States, and it is expected to go online next month. It is currently in a hot internal test. Cross-border sellers seem to have seen a new sales channel, and their enthusiasm for joining is growing. At present, some sellers have successfully submitted their information according to the relevant entry process and have received the opportunity for official one-on-one service.

In addition to sellers joining the platform on their own, people familiar with the matter said that Pinduoduo also sent targeted invitations to some sellers, including several major sellers in South China City and SHEIN suppliers.

In the face of the precedent of giants' failure in going overseas, Pinduoduo's high-profile pace of going overseas is inevitably questionable. Some critics directly pointed out that its low-price model has many problems and will be fined heavily. However, many industry insiders are still optimistic, believing that the worsening inflation in the United States and the popularity of low-priced goods may create a situation for Pinduoduo to go overseas. Whether Pinduoduo can cut into the United States is even more related to its future overseas destiny.

0 commission! A large number of sellers rush to join Pinduoduo's cross-border platform

Pinduoduo is entering the cross-border market, and its cross-border e-commerce platform is expected to be launched in the middle of next month, with the United States as its first stop.

At present, Pinduoduo cross-border platform has opened investment promotion for all categories, including clothing and shoes, luggage accessories, jewelry, maternal and child products, children's clothing and toys, sports and outdoor, 3C digital, small appliances, mobile phones and accessories, auto parts and motorcycles, office supplies, pet supplies, home furnishings, musical instruments, and industrial tools. And one store can sell multiple categories.

The news that Pinduoduo entered the cross-border e-commerce market and started to recruit investors was like a bomb, which attracted great attention from the cross-border sellers circle. A large number of sellers moved in after hearing the news.

Tian Wei, a cross-border seller, said that he had joined four related groups since Pinduoduo announced the news. These groups were newly created and growing rapidly. "When I joined the groups, there were basically dozens of people, sometimes hundreds. The next day, all of them had reached the upper limit of 500 people. The groups were constantly discussing issues such as entry channels and conditions. The enthusiasm of peers for this platform is quite high," said Tian Wei.

In the relevant seller groups, the editor also saw many sellers discussing the settlement process, problems encountered during the settlement process, how to solve them, etc. The attention and related topics continued to rise. According to our understanding, these groups were not officially established by Pinduoduo, and most of the group members were sellers from various cross-border e-commerce platforms.

Seller Xiaotian said that seeing his peers doing it, he was ready to give it a try, since there was no commission now. Inland seller Li Tiancai said that he saw the news about Pinduoduo's cross-border platform and was paying attention to it, but he did not have a factory or supply chain advantage, so he planned to wait and see.

Why are sellers so enthusiastic about Pinduoduo's cross-border platform? Tian Wei believes there are several reasons:

1. Seize the initiative on new platforms : Many cross-border sellers know that no matter which platform or emerging market, being the first to enter the market will always give them the upper hand. In addition, Pinduoduo is a well-known e-commerce platform in China with a relatively successful foundation. Now everyone wants to be the first to try it out.

2. The first stop is the United States, where demand is relatively high : Many cross-border sellers are operating in the U.S. market, which has relatively high demand. Many sellers understand U.S. consumer habits and have a certain customer base.

3. 0 commission policy : Compared with other e-commerce platforms with a commission of about 8%-25%, Pinduoduo's cross-border platform is relatively friendly. It now has a 0 commission and 0 rake policy, which can save a lot of costs. Of course, this policy is definitely only temporary, but you must seize the opportunity when there is wool to grab.

There is no doubt that this move by Pinduoduo has ignited the enthusiasm of some cross-border sellers, and also ignited the enthusiasm of sellers who sell in domestic channels and want to enter the overseas market. Some Pinduoduo sellers are also paying attention to the entry of cross-border platforms.

According to the source, in addition to sellers joining on their own, Pinduoduo has also started a targeted invitation system. Many cross-border e-commerce sellers in South China City have received invitations, including well-known sellers with annual sales exceeding 1 billion, and even some top sellers. Because any platform hopes to get big sellers to support it in the early stage.

The source further said that there are some suppliers of SHEIN on the list of Pinduoduo's targeted invitations . A merchant friend who supplies SHEIN has received an invitation from Pinduoduo to join. Earlier this year, Pinduoduo's supply chain team also moved to Panyu, Guangzhou, where there are a large number of SHEIN suppliers.

It is reported that the operating model of Pinduoduo's cross-border e-commerce platform is suspected to be highly imitated from SHEIN. No complicated operational operations are required to join the platform. You only need to confirm the product selection and price with the corresponding investment promotion staff. The rest will be selected, priced and fulfilled by the Pinduoduo platform.

SHEIN merchants are responsible for design, production and modification. After listing the products, they will send the goods to the warehouse designated by the platform, and the platform will complete the rest of the work. Relying on a strong supply chain, SHEIN has a wide variety of products with very attractive prices, which are very popular among American consumers. In the first half of this year, SHEIN successfully surpassed Amazon and became the most downloaded shopping app in the United States.

Perhaps seeing SHEIN's overseas success, Pinduoduo cross-border platform wants to emulate and replicate SHEIN's success. Currently, it has taken the first step in expanding overseas markets by high-profile investment promotion.

After submitting the information, the seller has received official one-to-one service

It is understood that Pinduoduo's recruitment this time also has certain conditions. Many registrants believe that factory sellers will be given priority. Since Pinduoduo is benchmarking SHEIN, it must learn from its model of relying on factories and having price advantages. In addition, Pinduoduo has relied on low-price strategies to break through in China, and this strategy will be used in overseas markets, making it a cross-border e-commerce platform with low prices and rich categories.

Currently, Pinduoduo only allows ordinary stores to enter. The relevant requirements for ordinary stores to enter include: having cross-border e-commerce experience (such as Amazon, Walmart, AliExpress, SHEIN, eBay, Shopee, etc. or building an independent website); having spot goods and strong supply chain integration capabilities; having certain operating experience and being able to draw pictures and text descriptions; and paying attention to product quality and consumer experience.

According to Tian Wei's sharing, the registration process is relatively simple. Open the official Pinduoduo public entry link and choose to enter a regular store; fill in the business license, ID card information, factory information and other information; and perform real-name authentication.

Among the many registrants, Tian Wei, who has a factory advantage, quickly received official one-on-one matching services after submitting his information. The official waiter told him the following points to note:

1. Each enterprise is requested to select the most representative hot products. The platform will select some first-launch products and strive to be the first to be launched . The platform will focus on the promotion of first-launch products, so everyone should select carefully.
2. Matching degree analysis : In the early stage , we will focus on North America, light and small items, and use air transportation.
3. Hot sales analysis : priority will be given to products promoted by SHEIN , Amazon and Walmart, and priority will be given to products promoted by independent sites.
4. Each home furnishing comprehensive seller can submit 50-100 items, and other vertical category merchants can make arrangements based on their own circumstances.
5. Please submit before 18:00 on August 22 .
6. The first wave of first-run products will be in the form of a table, and the efficiency will be improved through systematization later on .

Afterwards, Tian Wei also received a project introduction from Pinduoduo. In the introduction, Pinduoduo called its cross-border platform "Duoduo Cross-border" and mentioned some details that sellers were concerned about.

To join the Pinduoduo cross-border platform, you need to pay a basic deposit of 1,000 yuan. After the sales reach 1,000 yuan, you can withdraw the part exceeding 1,000 yuan.

Regarding accounts and withdrawals, Pinduoduo mentioned that it will go through a public bank account. The platform will first transfer the money to the merchant's payment account, and then the merchant can withdraw the money by binding a card. The payment cycle is expected to be around 15 days, basically based on the receipt date + 1 payment, and there may be 3-5 days of platform settlement time.

Because of Pinduoduo's low-price model in China, many sellers are worried that when its cross-border platform continues its low-price model overseas, it will trigger a large number of returns. Regarding after-sales returns, Pinduoduo said that consumers' after-sales returns will be returned to overseas return warehouses and will not be sent back to domestic warehouses. Returns without quality issues will be resold in overseas warehouses, and the merchants will bear the after-sales quality responsibility.

In addition to worrying about the return issues caused by the platform, more sellers are also concerned about whether the low prices of Pinduoduo's cross-border e-commerce platform will damage the sellers' profits. At present, various cross-border platforms are in a serious state of internal competition. Will Pinduoduo's cross-border platform exacerbate the internal competition? This makes many sellers feel uneasy.

Obviously, Pinduoduo's move to become a cross-border e-commerce platform has attracted attention in the industry, but it has also faced controversy. Will it become a cross-border behemoth as it wishes, or will it become a flash in the pan? People in the industry are divided on this issue.

High inflation in the United States continues, and Pinduoduo's "low-priced goods" can stand

Tian Wei is very optimistic about Pinduoduo's cross-border business. The reason why he applied to join the platform as soon as possible was not only because he wanted to grab a spot in the early stage of the platform, but also because of his intuition from many years of e-commerce experience.

"When ordinary people buy things, if there is not much difference in all aspects, most people will choose cheaper goods, just like many foreigners will buy things on Pinduoduo or Taobao. As long as the price of the product is low enough, the advantage is still relatively large. Now affected by the epidemic, the money in the wallet is limited, and people want to go to cheap and affordable platforms. Even if Amazon has a thousand advantages, under the temptation of price, everything else is trivial."

With continued inflation, the impact of prices on people's shopping cannot be ignored.

Industry big V "Factory Manager in the Wind" pointed out that cross-border e-commerce sellers feel the most about the inflation in the United States. Americans who love to spend now have no money. A direct evidence is that Amazon blocked a large number of seller accounts last year. It stands to reason that with less competition on the platform, the sales of the remaining sellers should have increased, but the actual situation is that this year's orders have dropped significantly compared with last year.

Some Chinese in the US said that inflation is severe and their daily expenses are at least 15% higher than before. "Rents have risen sharply, but gas prices have fallen back below $4. Daily necessities and food prices have risen a lot, so I don't dare to spend money recklessly. I buy clothes and some small items on Taobao and ship them over," said one of them.

Consumers are more sensitive to small packages and low-priced products. Sellers clearly feel that low-priced goods account for an increasing share of the market. At this time, Pinduoduo's cross-border platform took action, and it must be said that the timing was very clever.

Daweige believes that the industry's enthusiasm for Pinduoduo's cross-border platform is not difficult to understand. In fact, sellers no longer have the enthusiasm for non-European and American mainstream platforms to enter as in previous years. More people will take a wait-and-see attitude, rather than scrambling to be the first to try it out. The reason is that they need to consider various factors, such as the labor costs, operating costs, and inventory preparation expenses required after entering.

But if some new platforms with traffic emerge in Europe and the United States, everyone will still be willing to try them because the operating costs are relatively low.

Pinduoduo chose North America as its first overseas destination, which is highly consistent with the main target market of most sellers. They are familiar with the consumer demands of this market, and their accumulated experience in product selection also counts. Now, they only need to increase the inventory prepared for other channels appropriately, without the need for additional product development and supply chain support. After entering the market, they will have an additional sales channel, which is a good thing.

In addition, the light operation model of Pinduoduo's cross-border platform has liberated sellers and opened the door to factory-type sellers. After entering the platform, sellers only need to be responsible for listing products and sending them to designated domestic warehouses. Product selection, pricing and fulfillment are all handled by the platform. For many factories that want to enter cross-border e-commerce but don't know how to do it, this makes up for their shortcomings in operation and is an option that fits their own situation very well.

This will also attract a group of domestic e-commerce sellers. "Many domestic sellers will be interested in this model because they only need to upload products without operating them. Factory-type sellers also prefer this model, and this has become a product release channel to attract such sellers," said Dawei.

At its core, most people voted for Pinduoduo's overseas expansion project because of its great success in the domestic e-commerce field. In just a few years after its launch, Pinduoduo snatched market share from the two giants, Taobao and JD.com, and now has 880 million active users. Even though the current growth has begun to slow down, it has already attracted a large number of users. Although the "cut one knife" communication model has always been controversial, the results of Pinduoduo's strong expansion have convinced many people.

An industry seller strongly supports Pinduoduo's move. He mentioned that an important reason is that a lot of subsidies are needed to enter a market in the early stage, and Pinduoduo developed in this way in China, which is exactly the way it is familiar with. He also has another intention. Amazon is already a monopoly, and this kind of platform status is not friendly to sellers. According to Pinduoduo's thinking of using the touchstone to "blow up the top of the pyramid", it may become a spoiler in the cross-border market, which is not a bad thing.

However, contrary to the views of its supporters, most people who are not optimistic about Pinduoduo's overseas attempt hold the view that Pinduoduo's successful model in China cannot be replicated and applied in the North American market.

Will the starting strategy become a shackle for going overseas?

In the early days, Pinduoduo used WeChat to achieve social fission of users through group buying, bargaining and other operational means, and quickly accumulated a large number of users at a low price, saving the first pot of gold. In 2018, it directed a large number of users to its own APP, and eventually accumulated hundreds of millions of users.

However, many cross-border practitioners believe that there is no communication soil like WeChat abroad. If Pinduoduo continues to adhere to this domestic strategy, its overseas dissemination will be greatly hindered.

An industry insider bluntly said that he was "not optimistic": "From the perspective of the model, the gameplay of using games and the psychology of being cheap to create fission may be feasible in China, but it is unlikely to work in the mainstream circles in Europe and the United States."

In addition, Wu Jiayang, CEO of Chuanliu SaaS, believes that Pinduoduo was 50% wrong when it chose to focus on the APP. First, the majority of Western mobile traffic is on responsive pages, not on the APP. From the perspective of the audience, Pinduoduo has found a niche traffic channel.

Secondly, the cost of APP promotion to download is several times that of the web page (including PC and responsive web page), which is very expensive. Although the lifetime value of customers after retention on the APP is high, the value generated by this part of users is far from making up for the extremely high cost of promotion. As a result, this application requires a huge amount of money to promote in the early stage, and the road to break-even is long.

Judging from its public business, Pinduoduo does not have much experience in cross-border overseas expansion, which means that when developing the North American market, it needs to spend a lot of time and energy to integrate social media, overseas warehouses, logistics and other channel resources to fill the gaps in these areas. This cannot be achieved by just spending money.

A seller with many years of Amazon experience is concerned about Pinduoduo's cross-border e-commerce plan, one of which is the cross-border transportation link. He mentioned that the delivery rate of foreign express delivery is far lower than that of China. A few years ago, when he was doing FBM, he often encountered customer refunds on the grounds that the goods were not received; whenever it was peak season or when the epidemic was severe, the US ports were blocked and the logistics costs soared, and the FBM model was difficult to work. These variables also apply to Pinduoduo, which ships from domestic warehouses.

Secondly, the low-price strategy may not be a trump card. At present, there is no shortage of low-priced products on platforms such as Amazon, Wish, and Walmart, but this cannot change the fact that some products are unsalable. In addition, with many buyers restraining their consumption, Pinduoduo may not be able to break through smoothly by relying on low prices.

After the news of Pinduoduo's cross-border platform project came out, there were also many discussions about possible counterfeit products and refunds. "Foreign countries do not have as high tolerance for non-compliance as China. If the third-party payment company finds out that you have received many complaints, it will directly block your payment account." "If there are 10 products in the picture and you sell 5 in a pack, then if the buyer initiates a dispute, the seller will have to pay."

From the official launch of the project in May to the start of investment promotion in August, the Pinduoduo overseas project team must have done some homework and should have made plans for logistics, marketing and other aspects. Whether the first shot in the North American market can be fired is very critical. Pinduoduo not only needs to get the first impression points from suppliers and consumers, but also needs to test whether the project can continue to expand and figure out how to better implement it.

In the current environment of slow growth in e-commerce sales, Pinduoduo's new track may give some sellers a chance to overtake others. Judging from its requirements for settled enterprises, factories or integrated industry and trade sellers are more favored. As factory sellers come to the fore from behind the scenes, the profit margins of pure trade sellers will become smaller and smaller, and the pattern of the cross-border e-commerce industry may undergo subtle changes.

Pinduoduo

Duoduo Cross-border

Cross-border e-commerce