The Dilemma and Breakthrough of Pinduoduo-style Social Fission in the European and American Markets: New Thoughts on Web3 Growth

Author: Stella L (stella@footprint.network)

As Web3 projects expand globally, many are beginning to consider how to overcome the growth bottlenecks caused by regional cultural differences. The social fission model that has worked well in Asian markets has frequently faced setbacks in Europe and the United States. Behind this phenomenon lies a more complex interplay of cultural differences and user psychology.

The Pinduoduo Model: The Secret to Social Fission Success in Asia

Pinduoduo's success has brought the marketing approach of "social fission" to its peak in the Asian market. From its establishment in 2015 to 2020, Pinduoduo achieved an astonishing growth in annual active buyers to 788 million in just five years (according to Pinduoduo's financial reports), becoming China's second-largest e-commerce platform.

The reasons for this are firstly based on the deep-rooted collectivist culture in Asia . Here, interpersonal networks are intricate, and people have a strong sense of group identity; sharing discount information not only does not create social pressure but is seen as a way to maintain relationships. This cultural foundation provides a natural soil for social fission.

Secondly, the highly digitized social environment in Asia plays a crucial role . The combination of a well-established mobile payment system and frequent social media usage has fostered a mature digital social culture. People are accustomed to sharing various aspects of their lives on social platforms, including consumption experiences and shopping discounts.

More importantly, Pinduoduo's precise grasp of user psychology . They successfully transformed the individual behavior of "saving money" into a social topic, reducing marketing traces through carefully designed gamification mechanisms, and cleverly leveraging community power to create a strong sense of participation. This approach not only encourages spontaneous user participation but also maintains ongoing activity.

It is noteworthy that Pinduoduo's success relies not only on the social fission mechanism itself but also on a deep understanding of local user behavior patterns. They perfectly combined the seemingly contradictory concepts of "saving money" and "socializing," creating a unique "social + commerce" model. This precise understanding of local user psychology provides important insights for considering how to promote social fission in other markets.

This successful model was subsequently attempted in the Southeast Asian market. Several local social e-commerce platforms adopted similar mechanisms, demonstrating strong vitality in markets like Vietnam and Thailand, fully illustrating the high compatibility of this model with Asian culture.

The European and American Markets: A Fertile Ground or a Barren Land for Social Fission?

As the overseas version of Pinduoduo, Temu cleverly transformed the social fission model when entering the U.S. market. Its "Referral Bonus" program has simple rules but significant effects: users can earn a $20 cash reward by inviting five new users to register through platforms like WhatsApp, Twitter, and Facebook, with higher rewards for more invitations. Although this mechanism cannot fully replicate Pinduoduo's "cutting a slice" model due to local legal restrictions, it still successfully triggered viral spread.

Data confirms the effectiveness of this strategy: in the first month of 2023, Temu topped the U.S. iOS free download chart for 28 consecutive days. By the end of 2023, its monthly active user count (MAU) was second only to Amazon, achieving approximately $16 billion in GMV within a year, surpassing SHEIN, which has been entrenched in the market for a longer time.

It is worth noting that even successful cases like Temu have undergone multiple adjustments to their social fission strategy. From the initial five-person invitation for $20 to later adjustments requiring seven people for the same reward, this flexible strategy adjustment reflects ongoing observation and response to market reactions. This iterative optimization approach provides important practical references for Web3 projects.

However, this may be one of the few successful cases of social fission in Europe and the United States to date. Numerous failed cases over the past decade warrant reflection. Facebook launched the "Refer-a-Friend" program but ultimately had to adjust its strategy due to user aversion to this "spam-like" invitation. The case of Groupon is even more cautionary. Once a group-buying giant with a market value of $16 billion at its 2011 IPO, its over-reliance on high discounts and social pressure ultimately led to user attrition, with a market value of only about $320 million by November 2024. This dramatic decline highlights the fragility of a marketing model that relies solely on discounts in the European and American markets. Snapchat's referral program also faced bottlenecks. Despite being extremely popular among young users, its social fission plan performed poorly due to user concerns about privacy and fatigue from continuous marketing messages.

These cases reveal the uniqueness of the European and American markets: users have a strong awareness of privacy, maintain a high level of vigilance towards commercial promotion behaviors, and the tradition of individualism makes users reluctant to be labeled as "marketers." More importantly, these markets have a lower tolerance for marketing methods, with users more inclined to make decisions based on personal judgment rather than social pressure.

However, recent data shows that the European and American markets do not completely reject social fission. For example, Telegram has surpassed 950 million users, with over 10 million paid users, a significant portion of whom come from Europe and Russia. In 2024, acquiring users within the Telegram ecosystem has become a clear trend for Web3 projects. This indicates that European and American users also have a willingness to accept innovative social forms.

There are indeed significant opportunities in the European and American markets. Firstly, the advantage of a large user base provides ample growth space for projects, as a vast number of active social media users are highly receptive to digitalization and accustomed to switching between multiple platforms, providing a good channel for social fission.

Moreover, it is noteworthy that the current level of competition among Web3 projects in the European and American markets is relatively low, and there is still room for optimizing user acquisition costs. The market's acceptance of innovative marketing models is high, providing a rare opportunity window to redefine social fission.

Challenges: Why Traditional Social Fission is Difficult to Replicate?

Culturally, the deeply rooted individualism tradition in European and American societies starkly contrasts with the collectivism in Asia. Users in Europe and America generally have a strong sense of personal boundaries, maintain a natural vigilance towards marketing messages, and place great importance on personal privacy protection. This cultural characteristic makes traditional social fission methods often ineffective.

Social pressure is particularly evident in the European and American markets . Users generally worry that commercial promotion behaviors will affect real social relationships and are reluctant to be labeled as "marketers." This psychological burden severely restricts the natural spread of social fission.

Building trust mechanisms faces greater challenges in the European and American markets . Cryptocurrency-related projects generally have low trust levels in these regions, and users maintain a cautious attitude towards emerging technologies. Establishing trust requires a longer process and more effort. At the same time, European and American users have higher demands for marketing methods; direct incentives often yield poor results, requiring more refined value delivery methods.

Breakthrough: Redefining Social Fission in the European and American Markets

To achieve breakthroughs in the European and American markets, the primary task is to transform strategies. The traditional "pressure marketing" model needs to shift to a "value-sharing" model. This means that when designing growth strategies, there should be a greater emphasis on individual benefits rather than community pressure, highlighting users' autonomy and focusing on building positive sharing motivations. When users perceive real value and can decide whether to share, the effectiveness of dissemination often improves.

Gamification design also needs to be localized. Interactive mechanisms should pay more attention to personal experiences, reduce obvious marketing traces, and provide personalized participation methods tailored to the psychological characteristics of European and American users. This transformation should consider not only functional aspects but also delve into user psychology. The new growth paradigm should explore the optimal user incentive mechanisms within the boundaries allowed by rules, finding a balance that can effectively achieve fission without alienating users.

For Web3 projects, social fission has a unique advantage: the automated reward distribution mechanism realized through smart contracts can ensure fairness and transparency throughout the process. This not only reduces users' doubts about marketing activities but also builds trust through the inherent verifiability of blockchain technology. For example, projects can put invitation records and reward distribution processes on-chain, allowing each participant to verify the fairness of the activity.

In specific implementation, attention should be paid to the following key points:

• Transparency : Clearly display rules and reward mechanisms to establish trust.

• Autonomy : Give users ample choice, avoiding coercion.

• Value orientation: Highlight individual benefits rather than social pressure. "Benefits" in the Web3 field can be set as waitlist whitelist qualifications, points, tokens, or NFTs, combined with industry characteristics.

• Privacy protection : Strictly comply with local regulations and respect user privacy preferences. Social fission activities in the Web3 field can leverage blockchain technology to protect sensitive information such as participants' wallet addresses.

At the tool level, technological innovation will play a key role . The emergence of no-code tools has significantly lowered the usage threshold, enabling operational teams to quickly adjust strategies. Strong data analysis capabilities provide support for decision optimization, helping projects better grasp user needs. Additionally, native product integration, simplified participation processes, and transparent reward mechanisms will all become important factors in enhancing user experience.

Furthermore, in addition to social fission, other marketing methods can also be combined for a multi-pronged approach. Temu's success did not rely solely on social fission. It also invested heavily in social media advertising and traditional advertising (such as the Super Bowl). Overall, the average American user has encountered Temu ads 60-70 times across various platforms. Most Web3 projects may not have Temu's massive advertising budget, but they can leverage industry characteristics to use KOLs or influencers for social media content dissemination, combined with social fission, to achieve better results.

The Future: A New Paradigm for Social Growth in Web3 Projects

As Web3 projects develop globally, how to achieve effective user growth in different cultural contexts will become a key issue. In the European and American markets, social fission is not impossible; it requires deeper localization and innovation. Especially in the Web3 field, with the development of new social protocols and decentralized identity solutions, social fission may welcome new opportunities. These technological innovations can not only better protect user privacy but also provide more diversified value delivery methods for social fission. Project teams need to continuously pay attention to these technological developments and integrate them into the design of growth strategies.

Through appropriate tools and strategies, combined with a deep understanding of local user psychology, Web3 projects can certainly find a new paradigm for social growth suitable for the European and American markets. In this process, flexibility, transparency, and user experience will be key factors for success.

In this global competition for Web3 growth, the true winners are not mere imitators who replicate successful experiences but pioneers who can innovate and adapt to local conditions. Only by truly understanding and respecting market differences can one seize the initiative in the wave of globalization.