Chinese social e-commerce platform Pinduoduo will spend at least 500 million yuan (73.8 million U.S. dollars) in subsidies to support sales of brand-name products in small cities and rural areas in 2019, the company announced Friday.
The company has established partnerships with over 100 brands covering fields from food to consumer electronics to subsidize their sales with the aim of bringing more authentic and quality products to the country's less developed regions.
Over 600 million products have been sold since Pinduoduo launched two online stores focusing on brands and home appliances last August, most of which went to fourth and even lower-tier cities.
These efforts will speed up sales of brand-name products in less developed regions while pushing out knock-offs, said Pinduoduo co-founder Da Da.
Founded in 2015, Pinduoduo is known for offering group buying deals with big discounts and enjoys a huge consumer base in rural areas and small cities.
The NASDAQ-listed company earlier this month announced a follow-on public offering plan worth over a billion U.S. dollars, which will be used to enhance and expand its business operations, for research and development, and for general corporate purposes and working capital, including potential strategic investments and acquisitions.