Pinduoduo Enterprise Strategy Research Based On Innovation Perspective

After more than 20 years of development,China's e-commerce industry has entered a mature stage,showing an only super company and multi-great companies market structure.Alibaba,the only company,has more than 50% market share and has strong control over the market.As a late entrant to the e-commerce industry,Pinduoduo can have more than 500 million users in less than 5years,becoming the second largest e-commerce platform in terms of user scale,and has the potential to disrupt the entire industry's competitiveness.There is much discussion on the reasons for Pinduoduo's success in the mature market with incumbent enterprises.From the perspective of innovation,some people believe that it is to realize disruptive innovation by focusing on the sinking market.Some consider it a "free model" that charges merchants extremely low fees.It is also believed that it comes from the innovation of the group-buying model to realize the rapid growth of the number of users.But why Pinduoduo chose these innovative strategies,and what is the basis for choosing different innovative methods in different levels of strategy? The study of the strategic logic of Pinduoduo's implementation of innovation strategy is of higher reference significance to other late-developing enterprises.This article is based on professor Michael Porter's definition of strategy as a research framework,that is,strategy is a unique advantage formed by positioning and a series of business activities.First,by studying the internal and external environment of Pinduoduo,we can determine the unique competitive advantage of it,then analyze what kind of positioning and what business activities Pinduoduo takes to strengthen the unique advantage of the enterprise.Finally,we can clearly help Pinduoduo to form the core competitiveness of unique advantages,and then put forward some reference suggestions for the future development of Pinduoduo.In the research process,the external environment and internal environment of Pinduoduo are first analyzed.The external environment of the company includes two parts,the macro environment and the industry environment.The macro environment is mainly analyzed from the perspective of economics,politics,society,and technology through the PEST theory.The industry environment is mainly analyzed through the Porter Five Force Model,HHI index,and key success factors of the industry.The company's internal capabilities include enterprise resources and enterprise capabilities.Enterprise resources are analyzed from four perspectives: brand resources,product resources,financial resources,and human resources.Enterprise capabilities are analyzed from four angles including market capabilities,operational capabilities,supply chain capabilities,and R&D capabilities.Through analysis of Pinduoduo's internal capabilities,judge Pinduoduo's competitive position in the industry,and compare and analyze the key success factors of theindustry with the industry's major competitors Alibaba and JD.The competition state matrix confirms that "lower product price" is key factor for success.Then it breaks down Pinduoduo's enterprise orientation and a series of business activities around this unique competitive advantage,and studies how Pinduoduo strengthens the unique competitive advantage of enterprises through company level strategy,business level strategy and support strategy.The analysis of strategic actions is carried out from three levels.The first level is the company level strategy.Pinduoduo focuses on the sinking market which is ignored by Alibaba,JD and other incumbent enterprises,and satisfy the sinking market consumers' chance of market entrance.At the same time,Pinduoduo possesses the potential of challenging the incumbent enterprises,and realize the industry's disruptive innovation.The second level is the business level strategy.Pinduoduo helps upstream merchants and downstream consumers sell or buy goods at a lower cost through the merchants' "free" entrance,making group and a series of business model innovation,to achieve the overall value chain cost reduction and efficiency improvement.The third level is the support strategy.With gaining the support of external partners,including financing,Pinduoduo has a large amount of low-cost stream resources and the financial resources needed to strengthen its operational capacity.Finally,it is concluded that the strategic fit around "lower product price" is the core competitiveness of Pinduoduo,and puts forward some reference suggestions for the future development of Pinduoduo from the perspective of sinking market and mainstream market.