Will Temu have Shein-like success as it goes online in the U.S.?
Temu has officially launched its website in the U.S.
The Chinese e-commerce marketplace features a wide variety of inexpensive products in the apparel and footwear, beauty and health, home and garden, electronics, office products, pet supplies and sports and outdoors categories.
The site, which has a Shein-like presentation, is currently offering 30 percent discounts on the first three purchases with no minimum. It is also adding free shipping and returns to entice consumers to order. Shoppers can access the site at temu.com or through available apps.
The marketplace operator says that it is able to offer low prices due to its “access to a global network of suppliers and fulfillment partners.” Temu says that it shares sourcing and fulfillment with its “sister e-commerce company” Pinduoduo, which is listed on Nasdaq under the PDD symbol. Pinduoduo “has worked with more than 11 million global merchants and handled 61 billion orders in 2021,” according to the Temu press release.
CNBC reported on Temu’s soft launch earlier this month. It characterized the move as a way for Pinduoduo to seek growth outside of the struggling Chinese market. The company, which was founded in 2015, is a smaller e-commerce player in its home nation where Alibaba.com and JD.com dominate.
Customers ordering from Temu will typically have to wait between seven and 15 business days from the time of purchase for their deals to be delivered. The site’s shipping page cautions customers that they may see longer delivery times than they are accustomed to because orders may be shipped “from another country or need to be bundled or packaged with other similar-sized items. Other external factors, such as current events or shipping carrier delays, may change the actual arrival time of your item.”
The CNBC piece points out that Temu comes to the U.S. to face entrenched sites including Amazon.com that American consumers have come to rely on. The company’s “group buying” approach gives it the ability to dramatically cut the price of goods, a strategy employed by Shein, which has made it the go-to site for millions of American teens.
Rui Ma, a Chinese technology analyst and host of the podcast Tech Buzz China, wrote on Twitter, “I agree that targeting the U.S. market is ambitious, but it is also true that Amazon has clear weak spots, such as fashion, which has made success stories such as Shein possible. But they for sure need to do better quality control for merchants, or else risk going the way of Wish.”
- Temu Brings Hard-to-Beat Promotions to Consumers With Launch of Global Online Marketplace – Temu/Globe Newswire
- China’s e-commerce giant Pinduoduo quietly launches U.S. shopping site in Amazon challenge – CNBC
- The largest Chinese e-commerce company you have never heard of is about to enter the U.S. with a model to challenge Amazon’s dominance – Fortune/Yahoo Finance
- Rui Ma – Twitter
DISCUSSION QUESTIONS: What do you see as Temu’s major challenges as it enters the U.S. market? Do you think a Shein-like model represents a competitive threat to Amazon, Walmart and other U.S.-based online marketplace operators?