Trust is an invaluable asset for an e-commerce platform like Pinduoduo. We serve more than 600 million active users, connecting them with more than 5 million merchants, or sellers, on our marketplace.
To ensure that the rights of our consumers are protected, Pinduoduo has put in place stringent policies to reward good-quality merchants and punish sellers who infringe on the platform rules.
We have a zero-tolerance policy when it comes to counterfeit goods, as they not only harm the reputation of our company and the brands on our platform, but poor quality of products poses harmful risks for our consumers too.
Since our inception, we have put the issue of combating IP infringement at the center of our operations. Using advanced technologies, we work with brands to takedown fake products so that our consumers can trust that their purchases are legitimate.
Pinduoduo takes its anti-counterfeit measures very seriously because we are aware that our buyers are unable to check the products prior to purchase. We are constantly striving to ensure that spurious sellers are unable to exploit the access they have to the hundreds of millions of consumers on our platform.
Along with consumers and merchants, it is imperative for us to gain the trust of reputed brands that operate on our platform. To maintain this relationship, we created an exclusive online portal to communicate more efficiently with brand owners.
The portal treats every brand, or IP rightsholder, equally and allows them to make takedown requests. We also have an English-language version of this portal to help international vendors and brands, and we use enhanced algorithms to improve the speed of takedown requests.
Our screening processes kick in from the time a merchant applies to join our platform. Verification begins at the application stage and continues with every new item that is listed. There is ongoing scrutiny in collaboration with brands whenever something is flagged.
Below are the processes we have in place to safeguard the trust of our consumers, merchants and brands on our platform:
Verification and Screening Process
Scrutinizing and verification happens at every stage when a new vendor registers on our platform, and we are proactive with our best practices when it comes to combating the sale of counterfeit goods online, following the guidelines by the International Trademark Association (INTA) 2017.
The guidelines call for e-commerce platforms to strengthen and streamline procedures for identifying and taking more effective action against repeat offenders.
As per our IP policy, individual merchants must submit their national ID cards, and we apply facial recognition technology to cross check against the national public security database to confirm the prospective vendor’s identity.
We also have restrictions on the number of stores that a merchant can set up. Corporate merchants looking to sell on our platform must submit their business license and national ID cards of their legal representatives and store managers, which are also checked against national databases. This screening process helps investigate alleged breaches and precludes those on our blacklist from setting up another account.
Our IP protection measures include the use of advanced technology such as data analytics, artificial intelligence, machine learning and image recognition to screen billions of products as they are listed onto our platform. Products which we identify to be potentially problematic are blocked and cannot be listed. The bulk of the platform’s efforts happen well before customers can see the product online.
Brand Care Program
This is a program that enlists 1,000 leading and well-recognized brands that have the highest exposure to consumers. We develop customized blocking rules for each brand using AI-driven verification models. Counterfeits are blocked automatically, and borderline cases are sent for manual review. We were able to take down millions of infringing products in 2019 because of this initiative.
PDD works with other IP rights holders to check the authenticity of their branded products on our platform. We often buy potentially infringing products to check how genuine they are, and sometimes have them evaluated by the rights-holders. In 2019, for example, we carried out more than 60,000 test purchases. Harsh penalties were meted out to those merchants who were selling infringed products.
As part of our commitment toward building user trust, we work with various brands on our platform to keep counterfeits at bay. We have developed mini programs that are tailored to the unique features of each brand. This helps verify manufacturing information and supply chain details, such as logistics and delivery, leaving little room for counterfeiters to switch the genuine article with fakes along the distribution chain.
If a consumer bought a lipstick from a well-known cosmetic brand, for example, and wants to check its authenticity, another mini program by Pinduoduo allows them to upload photos so that brand experts can inspect, verify and generate a report. A consumer could mail in the product for further examination if the photos provided insufficient information.
Pinduoduo has the toughest compensation policy among the major e-commerce platforms in China. Any merchant who sells counterfeit goods is fined 10 times the value of the products he sells on our platform, a compensation far exceeding what is required by Chinese law.
Additionally, all customers who bought such counterfeit products are compensated, regardless of whether they raised a complaint. We also give our customers triple compensation for sub-standard products and for delayed shipments.