Research On Pinduoduo’s Profit Model

Change often with the rapid development of the economy,mainly reflected in the traditional sales model is no longer enough to attract users,enterprise competition intensified,at this time only change can win.The same is true of the rapid development of Internet technology.It has accelerated the fight between traditional retail and e-commerce operators.A new e-commerce mode is occupying market share at an amazing speed,breaking away from the fight in the Red Sea and creating a new blue ocean.This is now pinduoduo Inc.He has gradually changed the development direction of traditional e-commerce industry by providing value for customers and creating and realizing its own value in a different way from traditional e-commerce-Social e-commerce.In order to comply with the development trend and get rid of the repression of Alibaba and Jingdong,as the first e-commerce in the industry to transform,pinduoduo’s profit model is constantly innovating,and building a profit model suitable for itself has become the top priority for pinduoduo to achieve sustainable development.This paper uses case analysis,qualitative and quantitative analysis and index analysis to study pinduoduo’s profit model.First of all,in the relevant theoretical part of the profit model,the definition of the profit model,the components,the profit model types of social e-commerce industry and its main evaluation methods are summarized.Secondly,after the brief introduction of pinduoduo’s business situation,this paper analyzes the current situation of pinduoduo’s profit model from the analysis of the components of profit model and the financial effect of profit model.Then,it analyzes the reasons for the current situation of pinduoduo’s profit model.Finally,some suggestions are put forward to optimize its profit model.Through the research and analysis of pinduoduo’s profit model,we can find that: pinduoduo starts from the creation of core value-social networking,and grasps the profit object by sinking the market;at the same time,businesses bring advertising and commission income to pinduoduo,which is its profit source;secondly,pinduoduo’s profit measures by interactive communication and other ways are also unique,coupled with the viral fission,Strengthen the flow intake and form a unique profit barrier.However,further research finds that pinduoduo has the following problems:low market share,insufficient overall profitability,failure to meet user demand,and poor profit ability core competitiveness are not significant enough.Therefore,it is suggested to optimize its profit model from five aspects: first,to increase market share and subdivide profit objects;second,to expand business sectors and enrich profit sources;third,to meet user needs and optimize profit points;fourth,to strengthen channel construction and improve profit measures;fifth,to change competition strategies and rebuild profit barriers.The research of this paper can be used for reference to optimize the profit model of pinduoduo,and also for the steady development of social e-commerce.