(Yicai Global) March 2 -- The short video platform run by Pinduoduo now has 150 million daily active users after just two years in operation, as the Chinese e-commerce giant reels in both users and creators through cash incentives, tech media Kr36 reported yesterday.

Pinduoduo makes payments to Duoduo Video users according to the amount of time spent browsing and the number of videos viewed, the report said. It also gives creators cash rewards according to the number of videos viewed, the number of likes and the duration of content.

“By opening an account, you can get hundreds or even thousands of Chinese yuan (equivalent to tens or hundreds of US dollars) a month,” said a person close to Shanghai-based Pinduoduo. In a sinking market, this is significant income.

Last year, Pinduoduo doled out grants to the tune of almost CNY1 billion (USD150 million) to Duoduo Video users and creators, the report said, citing people familiar with the matter. Each quarter it increased the amount of cash incentives, which helped push up the number of DAUs to a peak of over 150 million during the Double 11 online shopping festival in November 2022.

By comparison, TikTok’s Chinese version Douyin, which was set up in 2016, has more than 600 million DAUs and Kuaishou, which was formed in 2011, nearly 400 million.

The user duration of Duoduo Video, which can only be accessed through the tab bar at the bottom of Pinduoduo’s home page, is stable at about 30 minutes, almost the same level as WeChat’s short video platform which was launched in early 2020.

But the conversion rate and purchase frequency flowing to the main app remains limited. "In the fourth quarter of last year, income from commissions on short videos in a single day was only about CNY1 million (USD150,000), and the business is running at a loss," another person close to the company said.

Pinduoduo is expected to increase the commercialization rate of the "short video + live streaming" business to 66 percent this year from 33 percent last year, mainly by charging commissions on adverts, another person said. The commercialization rate of e-commerce giant Alibaba Group Holding’s e-marketplace Taobao's live streaming is close to 70 percent.

Editor: Kim Taylor