Will Amazon Haul Steal Market Share From TikTok Shop, SHEIN, and Other Chinese Retailers?

Amazon is making headlines across the globe with the announcement of Amazon Haul, a new shopping service advertising "crazy low prices" beneath the $20 price point.

In a Nov. 13 announcement on its website, Amazon promised that Haul would be "a place to discover even more affordable fashion, home, lifestyle, electronics, and other products with ultra-low prices and typical delivery times of one to two weeks."

Amazon Is Poised To Take on Temu, SHEIN, and Other Large Chinese Retailers for Market Space

With news of the announcement making major waves, many analysts speculated as to whether this might be a move to capture desired market share in the low-cost online shopping space from established players such as TikTok Shop, Temu, and SHEIN.

"Amazon Haul is a response to both the rise of low-price Chinese marketplaces and the fact that consumers are increasingly seeking value for money as they try to make their budgets stretch further," said Neil Saunders, RetailWire BrainTrust member and managing director at GlobalData Retail, as reported by CBS News. Saunders went on to suggest that while Amazon had already captured a broad market concerned with value propositions, it had not yet developed a firm reputation as "an everyday low-price destination."

The launch of Amazon Haul follows earlier reports that the retail titan was engaged in plans to directly compete with Chinese retailers. During an invite-only conference held in China this June, Amazon announced it would be offering a new service that would allow Chinese sellers to ship to U.S. customers directly, with the understanding that the company's usual timely deliveries might take a bit longer as product was shipped from overseas.

Small-batch production — similar to what SHEIN has termed on-demand manufacturing, per CNBC — was a focal point of Amazon's presentation centered around its then-upcoming service. Promotion of this cost-cutting measure followed an Amazon announcement that it was curtailing fees for sellers opting to sell articles of apparel under the $20 price point, as well as the reveal of a new "innovation center" in Shenzhen, China, a city known as a tech hub and manufacturing base.

Temu and SHEIN Could Prove Tough To Beat as American Consumers Buy In

Despite Amazon already having a massive footprint in the online retail space as far as U.S. consumers are concerned, Temu and SHEIN could provide stiff competition — particularly during this holiday season.

According to an August Salesforce forecast, one in five (21%) purchases this season are expected to be made on Chinese shopping apps such as SHEIN, Temu, and TikTok Shop. Further, 35% of those polled by Salesforce indicated that they had increased their purchases through these apps over the previous three months compared to the prior year.

This data was seemingly reinforced by Forbes contributor Beth Ann Kaminkow, who detailed her own experiences and positions on these companies.

"Of the top seven marketplaces around the world, six are Chinese, according to a VTex presentation I saw last October," Kaminkow wrote. "That statistic should get the attention of marketers and retailers everywhere. The competition isn’t hiding, they are in plain sight. And we consumers are voting with our wallets!"

TikTok Shop Could Also Present Challenging Competition

While Kaminkow gestured toward the continued success of more established Chinese retailers such as SHEIN and Temu — the latter recently splashing out $21 million in Super Bowl ads while being the No. 1 downloaded app on the Google Play and iOS App Stores in the first half of 2024 — she also underscored the notion that TikTok Shop could be the one to watch this holiday season.

Citing data from e-commerce marketing company Omnisend, Chain Store Age reported in July that one-third (33%) of Americans had already purchased an item from TikTok Shop, despite the fact that the retailer had just launched in September 2023. This degree of growth may have been driven by younger Americans, particularly members of Gen Z.

"With Gen Z rapidly entering the workforce and emerging as a formidable economic force, their unique preferences and digital fluency are reshaping the online retail landscape," said Greg Zakowicz, senior e-commerce expert at Omnisend, per Chain Store Age.

"By launching an e-commerce platform and targeting Gen Z consumers, TikTok has entrenched itself deeper into the U.S. economy, strategically arming itself against the threat of a ban," Zakowicz concluded.