So-and-so redefines mathematics

Author | Zheng Yue

Edit | Zheng Xuan

On January 14, the topic of "Pinduoduo bargaining, but always 0.9%" landed on zhihu hot search. It was a "bloody case caused by a lawyer 'slashing a knife'".

Liu Yuhang, a blogger @ Legal V, participated in Pinduoduo's "Bargain free to get" mobile phone activity in March 2021, but after inviting many people to bargain, "the second first place", the bargaining progress was always "0.9%".

In a fit of rage, lawyer Liu Yuhang sued Pinduoduo in court. Liu Yuhang submitted prosecution materials to the court on the grounds that Pinduoduo was suspected of violating the principle of good faith and using false data to conceal rules and constituting fraud when providing network services.

Recently, Liu Yuhang published an article on Zhihu, providing more details of negotiations with Pinduoduo, but the article has now been deleted.

Lawyer Liu Yuhang said in the article that in the trial of the case, Pinduoduo argued that because the page displayed a limited percentage of digits, they omitted a percentage of at least 6 digits after the decimal point to omirate 0.9%, and the 0.9% displayed on the bargaining page was not 0.9%, but 0.9996427.

When the court asked why the full percentage was not displayed on the page, Pinduoduo said that it was omitted because the display was limited and the number was inexhaustible. Lawyer Liu Yuhang said: "At this moment, I feel that my first 30 years of mathematics have been learned in vain, and my life needs to redefine 0.9%."

01 "Slashing a knife" is "fooling a fool"?

"Consumers slash a knife for a long time".

Geek Park searched for "Pinduoduo bargaining" on the black cat complaint platform, and there were 6177 results, and some consumers said that "after finding a lot of help, the difference of 0.01 gold coins was successful, and suddenly it became a difference of 100 gold coins."

Most of the complaints are similar to the experience of lawyer Liu Yuhang. Lawyer Liu said in the article that a mobile phone product in which he participated in the bargaining in Pinduoduo was only 0.9% away from taking the mobile phone for free, and the progress bar stayed at 99.1%. But in fact, from the time you receive the first $0.01, the progress bar has not changed since you cut off many $0.01s.

Xiaoye, who has participated in Pinduoduo's "slash a knife" activity many times, told Geek Park that he had experienced a permanent "difference" on Pinduoduo - when it was about to be completed, the progress of the remaining bargain would change. After the system prompted "Expect to invite 2 more people to get it for free", inviting 2 new users did not show that the bargaining was successful, but prompted "99.9% has been cut, still 0.1%", after inviting several friends, the page prompt became "there is still 8 knives to cut". In the process, the system will constantly prompt new users to bargain more and be close to the success of bargaining.

A common "slash and slash" campaign on the platform

Lawyer Liu Yuhang believes that Pinduoduo uses the weakness of human nature to allow consumers to complete various tasks set by Pinduoduo and purchase paid services, just to increase its App activity and income, which has constituted fraud and seriously affected the social atmosphere.

Pinduoduo responded in April, with Tang Jiangrong, senior director of the legal department, explaining, "Because some of the free cut goods are large, the amount of money cut by a small number of users is not enough to change the percentage, which will make consumers think that there is no change in bargaining." Pinduoduo responded that the "Bargain Free Collar" campaign is real and effective, with more than 1,200 products participating in this issue, and a total of 7.09 million items have been delivered.

Liu Yuhang's appeal is: Pinduoduo's real information and data of public activities, refund the service purchase fee of 9.9 yuan, and compensate himself for economic losses of 500 yuan and reasonable expenses of 1000 yuan.

It is worth noting that Liu Yuhang said that since his case against Pinduoduo attracted public attention in March last year, he has been interviewed many times in just 3 months. Liu Yuhang said: "This has seriously affected my normal work and life, and my family is even worried about my personal safety and fear that I will be retaliated against."

Lawyer Liu believes that everyone who uses Pinduoduo can sue Pinduoduo. "The cause of action in this case is an infringement lawsuit, a non-contract lawsuit, a lawsuit that infringes on the consumer's right to know, and in theory, every consumer who uses the Pinduoduo bargaining free service has the opportunity to become the right holder of the litigation."

"'Bargain free' is Pinduoduo's way of attracting traffic, and the rules of the game are opaque." Zhi Zhenfeng, a researcher at the Institute of Law of the Chinese Academy of Social Sciences, said in an interview that such activities take advantage of people's "advantage" psychology and tempt people to "keep betting" with rewards that seem "low-hanging on", just like "gamblers".

Zhi Zhenfeng pointed out that there are many problems in the activities similar to Pinduoduo's "bargaining free take", the algorithm rules are complex, and the key data is not transparent to users. "What are the chances of success in getting it for free?" Is there a suspicion of misleading consumers? Is the successful user information for page scrolling authentic? Is the price of the product inflated? These need to be further clarified."

Similar "ethos" has always existed, the same marketing routines have been used in multiple Internet products, and even in November 2021, when ofo said that the deposit was refunded again, the premise was that a new friend must be invited in, let him register successfully, pay a deposit of 99 yuan, and then refund the user's deposit.

"It's not just a marketing game." Zhi Zhenfeng pointed out that this one-way transparent algorithm is a relatively new problem at the level of legal supervision, its intelligibility and transparency are very important for consumers, whether it is integrity is also related to the survival of the business, if consumers feel that this is a scam, the game and the enterprise may usher in the "fate of being rejected".

02 Slash a knife has the lowest performance, and Pinduoduo breaks through from agriculture

Once the "slash a knife" project brought a lot of new people and traffic to Pinduoduo, but now when Internet traffic peaks, it is becoming more and more difficult to pull new so that the last "knife" of "slashing a knife" is more and more.

In the past, advertising, slashing and pre-installing mobile phones were seen as pinduoduo's new "troika". According to the late LatePost report, in the first half of 2021, Pinduoduo's "slash a knife" project was rated as the lowest "1" in the "271" performance score. In other words, Pinduoduo believes that relying on "slashing a knife" to pull new ones is not so effective. In addition, the operation of allowing users to go to duoduo orchards to water and fertilize, and finally changing dozens of cheap small commodities to a box of grapefruit is not so effective.

Slowing down along with "Slashing a Knife" is pinduoduo, a train that used to travel at high speed.

At present, the growth rate of Pinduoduo's active users and advertising revenue has slowed down significantly. According to the 2021 Q3 financial report, Pinduoduo's revenue during the reporting period was 21.506 billion yuan, far below market expectations (26.47 billion yuan); Pinduoduo's annual active users were 867.3 million, an increase of 18.6% year-on-year, and the growth rate hit a new record low for Pinduoduo; and the growth rate of online marketing services (advertising revenue) fell to 40%.

In addition, as of the end of September 2021, the annual buyer growth rate of Pinduoduo has dropped from 40% two years ago to less than 20%. The number of new users also continues to decline. From the first to the third quarter of 2021, Pinduoduo added 35.8 million, 21.6 million and 17.4 million new users in a single quarter, respectively. But as of the end of September 2021, the number of annual buyers of Pinduoduo is a staggering 867 million, 4 million more than Ali. The latest annual report discloses that the current number of employees in Pinduoduo is less than 8,000, while ali and JD.com currently have a total number of employees of more than 250,000 and 360,000 respectively.

GMV (Gross Commodity Traded) growth is also challenging. The research report of Dongxing Securities shows that the company's revenue and GMV are closely related, and the growth rate of Pinduoduo GMV in 2021 may be further slowed down due to the slowdown in revenue growth. In the first three quarters of 2021, Pinduoduo's revenue was 22.167 billion, 23.046 billion and 21.506 billion yuan, respectively, an increase of -17%, 4% and -7% sequentially.

At the same time, the financial report also shows that The marketing expenses of Pinduoduo in the third quarter were 10.0506 billion yuan, a decrease of 3% from the previous quarter, showing a downward trend for three consecutive quarters.

Continuous reduction of marketing expenses may not only make the financial report "better", but also in the second half of the mobile Internet, from the playing style completely shifted to the long-term doctrine of emphasizing research and development over marketing and insisting on investing in agriculture.

As of September 30, 2021, Pinduoduo has invested all of its operating profit in the last two quarters into the "10 billion agricultural research" project, and has invested about 7.17 billion yuan so far.

In the earnings call, Pinduoduo's new style is not much like an Internet e-commerce. Executives kept talking about agricultural digitalization, agricultural research competitions, tens of billions of agricultural research projects, and cultivating "100,000 new farmers".

Pinduoduo already sees agriculture as the second growth curve. According to the data, in 2020 alone, Pinduoduo's agricultural category GMV reached 270 billion, accounting for 16% of the annual GMV, which far exceeds the data of other e-commerce platforms, and Pinduoduo has become the world's largest agricultural product retail platform.

But not only Pinduoduo, before there is Ali rural Taobao, after there is community group buying, the giants facing growth difficulties are staring at agriculture.

In addition, the question of whether it will become the "next target" after Tencent's reduction in JD.com is also shrouded in the recent Pinduoduo. In the stricter anti-monopoly regulatory environment, Pinduoduo, which relies on WeChat as a "traffic factory", will face no small challenge.

Turning to agriculture is a correct and difficult road, in the era of e-commerce that fights for technology and services rather than marketing, Pinduoduo must also insist on constantly "cutting a knife" to get closer to the goal.

*Header image source: Visual China

This article is the original article of Geek Park, please contact Geek Jun WeChat geekparker for reprint