Why China's export manufacturers are turning to consumers at home

Why China's export manufacturers are turning to consumers at home

Staff Writer
Staff Writer
Pinduoduo Content Team
May 6, 2020

· Pinduoduo helps promote “Made in China” to its more than 800 million consumers

· Exporters are seeking China’s vast domestic market as external demand collapses

It takes a skilled craftsman 12 separate steps and 36,000 blows of the hammer to achieve the mirror-like finish for “China’s №1 Wok”.

A craftsman hammering an iron wok at factory in Zhangqiu, Shandong province.

The craftsmen were filmed by Pinduoduo (PDD) on May 1 inside a factory in the Zhangqiu district of Shandong province in eastern China, and the livestream was watched by people in cities big and small across the country.

Handcrafted Zhangqiu iron woks, Joyoung blenders and Midea multi-function rice cookers are among more than 100,000 items being offered at less than factory prices on PDD to promote domestic manufacturing and boost consumption in China.

The “Beautiful Life Made in China” campaign will last nine days starting May 1 and will feature items tagged as low as 40% below factory wholesale prices.

With external demand slumping with the coronavirus pandemic, the campaign is part of a broader push by PDD to assist the manufacturing sector and showcase domestic quality and craftsmanship. The move also highlights the company’s initiatives to help the country’s contract manufacturers build their own brands and reduce their reliance on export orders.

“Traditional e-commerce platforms often favor international brands, leaving little space for domestic products,” said a PDD spokesman. “By promoting domestic brands to PDD’s almost 600 million buyers, we hope that consumers will cultivate the habit of choosing the one that offers more value-for-money.”

Multinational companies have long relied on original equipment manufacturers in China to produce everything from apparel to iPhones. But the coronavirus pandemic has underscored the urgency for these factories to build their own brands and win over Chinese consumers, many of whom still prefer to pay a premium for a white-label product endorsing a foreign brand.

Read also: PDD works with physical retailers to boost domestic spending

The campaign is the latest initiative by PDD to help manufacturers build a domestic business. In December 2018, the Shanghai-based company launched its New Brand Initiative to support 1,000 factories across various industries to create and refine their own brands. PDD shared customer insights and consumption patterns from its e-commerce platform to help the factories fine-tune their products to meet consumer demand.

Beyond team purchases, flash sales and other promotional activities to promote such factory products, PDD also showcases these brands on its app and promotes them whenever an opportunity arises.

For example, PDD has signed a partnership to create a “Dongguan Pavilion” to showcase 10,000 businesses from the manufacturing hub in southern Guangdong province.

Read also: Couch travelling on PDD livestreaming

PDD is also planning to take its users on virtual tours of these factories to build their confidence in lesser-known domestic brands, offering them a behind-the-scenes peek at the ‘Made in China’ story.

The campaign will encompass more than 20 major manufacturing hubs, including Zhejiang, Jiangsu, Shandong, Hubei, Fujian and Guangdong.