Temu is opening up its marketplace to American and European sellers. In doing so, the Chinese platform hopes to improve its image and open up to new audiences.
In March, Temu will start to allow sales partners from the West. Currently, only Chinese sellers (an estimated 100,000 of them) offer products on the platform, often straight from the factory and at very low prices. The marketplace is particularly popular with a young audience through cheap gadgets such as five-euro shirts and ten-euro headsets. It quickly became the most downloaded retail app in the United States and is also growing rapidly in Europe.
An analysis by Barclays found that budget fashion players such as Boohoo and Asos are currently the most threatened, while “generalists” such as Amazon are still relatively safe. Brands also escape pressure to some extent, as the platform has a low-quality image due to the large number of counterfeit products. However, that may soon change if Western brands and sellers also join Temu.
Temu spends billions on online marketing and is already particularly dominant on search engines. This immediately explains why the Chinese newcomer can be of interest to American and European companies: if you want traffic, Temu could be the right place. Time spent by customers is also high, the Barclays survey states.
For Temu, it is an opportunity to improve its image, especially by offering brands alongside its cheap Chinese offerings. Moreover, the online retailer wants to start delivering faster: shipping from China easily takes a week or two, longer than western consumers are used to – and sometimes willing to – wait. American and European sellers will deliver directly themselves, and thus faster.
Cooperating with Western companies may also potentially ease political resistance, which is especially strong in the United States. Lawmakers there denounce the many packages from China (almost a third of those entering the US daily), as they often escape import taxes. Temu confirmed the news to Seattle Times, but said many business details are currently still being filled in.