Pinduoduo‘s community group-buying business, Duoduo Mai Cai, has launched its local offline business recruitment work in mid-December 2023, covering areas such as catering, hotels, and tourist attractions.
According to reports, the local life project of Duoduo Mai Cai was originally planned to be launched nationwide after the Spring Festival in February 2024. However, in the last week of 2023, some regional investment personnel received instructions stating that the project had been suspended. In response to this, Pinduoduo officials stated that “the local life business has been completely discontinued.”
Several insiders close to Pinduoduo have revealed that Pinduoduo had previously planned to use three months of losses to impact Meituan‘s main business. The best-case scenario was for Meituan to shrink or even abandon its Meituan Youxuan business due to the pressure. However, in reality, this strategic project did not satisfy the management team. They pointed out that Duoduo Mai Cai consumed a significant amount of internal resources and ultimately faced a low unit price and low gross profit business. In this situation, even if Duoduo Mai Cai became the industry leader, it would still fail to achieve overall profitability.
Pinduoduo released its third-quarter financial report on November 28, 2023: quarterly revenue increased by 94% year-on-year to RMB 68.84 billion (approximatly ＄9.6 billion); operating profit increased by 60% year-on-year to RMB 16.656 billion (approximatly ＄2.3 billion). In the third quarter, Pinduoduo‘s transaction service revenue was RMB 29.1527 billion (approximatly ＄4.1 billion), a year-on-year increase of 315%, possibly contributed by Duoduo Mai Cai and Temu, among others.