Pinduoduo Inc. (Chinese: 拼多多; Pinyin: Pīn duōduō) is a Chinese online retailer with a focus on the traditional agriculture industry. The business is the largest product of PDD Holdings, which also owns the online marketplace Temu.[2][3]
Pinduoduo was founded in 2015 by Chinese businessman and software engineer Colin Huang and initially focused on the agriculture industry.[4][5]
On 7 June 2018, Legal Evening News reported that Pinduoduo investigated and shut down stores and removed listings that violated its platform policy against pornography and violence, following an earlier report by the newspaper.[6]
On 20 January 2019, Pinduoduo reported to the police theft by hackers that exploited a loophole in their system and stole tens of millions of Yuan worth of vouchers.[7]
During the initial COVID-19 lockdown in China in 2020, Pinduoduo started a program to assist rural Chinese farmers with selling their produce to customers online instead of relying on traditional in-person marketplaces.[8] In August 2020, Pinduoduo launched Duo Duo Maicai, a service which enables consumers to preorder groceries for pickup at designated locations.[9]
In September 2022, Pinduoduo's sister's company, Temu, was launched in the U.S. by PDD Holdings.[11][12][13] In 2023, PDD Holdings changed its legal domicile from Shanghai to Dublin.[14]
Pinduoduo has been significantly criticised in domestic Chinese media for selling shanzhai products.[15]: 34 The company responded with an open letter stating that it had, in a single week in August, shut down 1,128 stores, taken down more than 4 million listings, and blocked 450,000 suspected counterfeit goods listings from being published.[16]
After it was listed on the Nasdaq stock exchange in 2018, China's State Administration for Market Regulation announced probes into the firm based on reports of counterfeit materials available on the platform.[17][15]: 34 Pinduoduo responded by intensifying efforts to remove counterfeit materials from its store.[15]: 208 According to the company, it removed over 10.7 million suspicious items and blocked 40 million suspicious links on its platforms.[15]: 208 Pinduoduo sought to reassure customers by stating that it would compensate customers with ten times the value of any counterfeit item found to have been sold through the platform.[15]: 208 This was three times as much as the compensation mandated by China's Consumer Protection Law.[15]: 208
Pinduoduo also introduced a penalty on sellers of items under which it would freeze ten times the trading volume of any item found to be counterfeit.[15]: 208 One thousand sellers responded with a protest in July 2018 at the company's headquarters, during which there were physical clashes with the company's security guards.[15]: 208 Sellers have also challenged Pinduoduo's penalty in court, but as of at least 2021 Pinduoduo won a significant majority of these cases.[15]: 208
The company also disclosed that it had removed 500,715 items and closed more than 40 stores as of February 4, 2020, to protect consumers from counterfeit and substandard masks being sold by merchants hoping to profit amid the COVID-19 pandemic.[22]
In 2023, Google removed Pinduoduo's app from the Play Store after a Chinese cybersecurity firm found malware in app versions carried in Chinese app stores.[23][24][25] Two days after releasing an update to address concerns, Pinduoduo disbanded the team of engineers and product managers who had developed the exploits. A majority of the team was transferred to Temu, working in various departments.[25]
Six cybersecurity teams interviewed by CNN – including Finnish, Russian, US, and Israeli firms – as well as Chinese cybersecurity firm DarkNavy, all labeled Pinduoduo as malware or potential malware.[25] In a report by Bloomberg News, a researcher from Kaspersky Labs stated the following: "Some versions of the Pinduoduo app contained malicious code, which exploited known Android vulnerabilities to escalate privileges, download and execute additional malicious modules, some of which also gained access to users' notifications and files".[26]
In 2024, the Financial Times and The Wall Street Journal reported that Pinduoduo sued several former employees for violating non-compete clauses. The evidence Pinduoduo submitted to court includes video recordings of the former employees going to work for Pinduoduo's rivals. The company said it does not "engage in any illegal or unethical surveillance practices of current or former employees."[28][29]
