Well yes, a new Chinese actor is establishing himself in the market of eCommerceand it is not Shein: it is about Ago. In the hope that the fake ambassadors of this new giant don’t pollute our Instagram feeds like Shein, it should be noted that the online shopping market on the Eastern front is also literally revolutionizing our habits. Other than All Quiet on the Western Front, to quote a successful film.
What is Temu, the eCommerce that is cannibalizing Shein
Temu is essentially an ultra-cheap marketplace where you can buy a pair of glasses for less than $2. eCommerce arrived in the United States last September, and immediately set itself a single goal: take Shein’s place.
Bloomberg reports that in the month of May 2023 alone, in the United States, average spend on Temu was 20% higher than on Shein. Not only: in April, Temu’s was the most downloaded app on the AppStore. And guess who held the record first? That’s right, right to Shein.
It must be said that Shein’s success is largely attributable to aggressive marketing on social platforms. Hashtags, spam, sponsored content and above all many/too many tags on posts have contributed to increasing what is called brand awareness dell’ecommerce cineseespecially for the Gen Z. Then, of course, there are the ultra-competitive prices to complete the recipe.
The big difference with Temu is that, as Business Insider reports, Shein manufactures its own products. You then earn from each sale. Temu is instead more similar to Amazona marketplace that brings together several separate shops within it.
The question of Chinese eCommerce in the West
Although Chinese ecommerce is growing rapidly, iThe economic comparison with giants like Amazon remains absolutely embarrassing. Data from Bloomberg Second Measure, which analyzes credit and debit transaction data, reveals that average spending on Shein and Temu is only a tiny fraction of that on Amazon.
Then there is the legislative question: An April report from the US-China Economic and Security Review Commission (USCC) raised major concerns about China’s emerging ecommerce. The document stated that Shein products contain a high level of lead and that the production is characterized bynon-compliance with the most basic labor laws.
Concerns from US lawmakers led Shein to delay his plans to go public. However, Chinese eCommerce, in an email to Supply Chain Dive, responded to allegations of violations of labor laws, stating that it implements a “zero tolerance policy towards any form of worker exploitation”.
But the USCC report affects Temu as well as Shein. According to the report the parent company of eCommerce, Pinduoduohe demanded of his workers hours of “extreme overtime”. Furthermore, cybersecurity experts would have detected several malware in Pinduoduo’s Android app.