With consumer confidence shaken by Covid and economic worries, even some of China’s biggest e-commerce firms have struggled to attract more business in recent months. That is, except for Pinduoduo Inc. (PDD.US), a thriving online marketplace for affordable goods and farm produce.
Price-conscious consumers with limited budgets have been hunting for bargains on the Pinduoduo platform, helping the company to post bumper quarterly earnings despite the challenging environment, and putting its better known rivals in the shade.
The third-quarter earnings beat market expectations, triggering a multi-day share price rally, as investors realized that economic uncertainty could be sending more online shoppers towards Pinduoduo’s marketplace – a trend known in the retail industry as “consumption downgrade”.