Temu and Shein, two Chinese companies, have made new progress in their &#34;showdown&#34; in the United States.
On Thursday, Bloomberg's Second Measure pointed out, after analyzing data from billions of credit and debit card transactions, that Americans' spending on Temu, the &#34;overseas version of PDD,&#34; was nearly 20% higher than that of Shein in May.
On the other hand, data from mobile app research firm Apptopia shows that in the six months since its launch, Temu's download volume has surpassed all shopping apps, and its engagement and retention rates have consistently ranked high on the US iOS app charts.
Adam Blacker, Director of Content and Communications at Apptopia, said:
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Temu's app performance is almost unprecedented. But it's too new, and we don't know Temu's results yet.
The current economic environment is definitely favorable to Temu because consumers want to buy the same things they need at lower prices to fight inflation.
</blockquote>
But Blacker also said that Temu's ranking in the app store may be due to its investment in advertising.
Wall Street News previously reported that platforms like Temu and Tiktok, early growth was largely driven by marketing spending, and they expanded their influence in the United States and overseas by heavily using Facebook, Instagram, and Snapchat's advertising platforms to acquire customers.
According to statistics, in January 2023 alone, Temu placed approximately 8,900 ads on Meta's various platforms, promoting its ultra-low discount products, such as $5 necklaces, $4 shirts, and $13 shoes. This constant &#34;spending&#34; even helped Meta reverse its consecutive decline in performance in the first quarter of this year.
In addition to advertising, Temu has also successfully replicated its parent company PDD's social viral growth, attracting a large number of users by &#34;chopping prices.&#34;
As shown in the figure below, Temu's &#34;Lucky Big Wheel&#34; not only offers $100 off coupons, but also allows users to get 400 coins, withdraw $50 in cash, and receive $90 in vouchers.
What is quite familiar is that when users are one round away, they will find that their chances have been used up, and the system will tell them, &#34;One more round, and you can get more money.&#34;
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/9de6df7d-3246-4e4c-8e2c-76512fd74043.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/9de6df7d-3246-4e4c-8e2c-76512fd74043.png"/>
Following that, users found that the only way to qualify for the spinning wheel was to invite new users to register.
<h2>Temu vs. Shein: &#34;Chop One&#34; Slightly Ahead</h2>
Since Temu's emergence, the battle with Shein, another shopping platform that has been overseas for a long time, has not stopped.
Last December, Shein sued Temu in a US court, claiming that it &#34;intentionally and blatantly infringed&#34; its trademark and engaged in &#34;unfair competition and false and deceptive business practices,&#34; including using Shein's copyrighted images as part of its own product listings.
In response, a Temu spokesperson replied that the company &#34;firmly denies all allegations and actively defends its rights.&#34;
Wall Street News previously mentioned that Shein has long been positioned in the minds of American consumers as a &#34;low-priced, full-style clothing shopping app from China,&#34; and now Temu is also targeting &#34;cheap,&#34; which has led to overlapping positioning between the two.
On social media such as TikTok, there are many users who compare Temu and SHEIN.
<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/d777ed6a-6a3a-4325-82dd-afa010865717.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/d777ed6a-6a3a-4325-82dd-afa010865717.png"/>
However, although both companies are synonymous with cheap products, Shein is a self-owned brand, while Temu is a platform that does not design and produce, but recruits third-party sellers to open online stores on its platform. After the seller sends the product to Temu's warehouse, the company is responsible for shipping, marketing and promotion, as well as after-sales service.
Temu regards Shein as its strongest competitor at this stage, and hopes to gradually surpass Shein in the next few years, and eventually approach Amazon and eBay's market share in the United States.
Previous analysis pointed out that what supports Temu's development speed is not only that PDD has replicated its past successful experience, but also the cooperation of a huge supplier group behind it. However, because Temu controls the pricing power, suppliers are quite passive in cooperation, and the supply is constantly being lowered in price, making it difficult to make money.
According to Bloomberg, a Guangzhou garment factory owner said that when he supplies goods to Temu, the usual practice is to take pictures of the most popular products on the app and look for suppliers who can provide the cheapest raw materials. He said that this practice is leading to a price war in some parts of the Chinese supply chain.
Nevertheless, these concerns have not stopped American shoppers from actively participating in &#34;Chop One&#34;.

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