PDD doubles down on investment in online agriculture, ramping up rivalry with JD, Alibaba

Pinduoduo is to ramp up competition with Chinese e-commerce competitors Alibaba Group Holding and JD.com by doubling down on rural e-commerce, after the Shanghai-based company said it saw the sector as a strategic focus over the next five years.

The social commerce player aims to become China’s No. 1 online agriculture platform by investing in related technologies and operations, with gross merchandise volume (GMV) for agricultural products expected to exceed 1 trillion yuan in five years, Pinduoduo said after announcing second-quarter results on Friday.

“Agriculture is a sector that touches the largest number of people and yet had the least amount of digitisation in the past decades,” said Chen Lei, Pinduoduo’s newly-appointed CEO during the earnings call on Friday. “Any technology that can improve productivity and efficiency along the agriculture value chain would have a huge impact.”

David Liu, vice-president of strategy of Pinduoduo, indicated during the earnings call that the company plans to sharpen its focus on agriculture through further investments in, and development of, its agricultural analytics system and logistics service to help farmers with decision-making and delivery. It is also planning more investments in technology for precision farming, warehouse control and food safety.

While Pinduoduo has developed a reputation for serving China’s agriculture sector, especially through the Covid-19 pandemic, this is the first time the company has detailed its long-term ambition, which will see it compete more closely with Alibaba and JD.com.

Alibaba is the parent company of the South China Morning Post.