By: Valentina Alvarado Moreno
We are already quite familiar with SHEIN, the Chinese e-commerce platform that sells very cheap fashion products under the slogan «making the beauty of fashion accessible to all». We also know that despite the poor quality of its garments, the lack of transparency regarding its production processes and the many lawsuits it has received for violation of intellectual property rights, today, SHEIN is very well positioned in the sale of clothing in Latin America and the world.
How does Temu operate?
In contrast to SHEIN, which buys from factories and sells its designs as its own brand, Temu operates as a marketplace that «connects consumers with millions of business partners, manufacturers and brands around the world». Although SHEIN has specialized in the fashion market, in recent months it has begun to offer a more varied range of products similar to those of Temu, such as household appliances, household goods, car accessories, among others.
This new platform operates with a pricing, discounting and couponing strategy very similar to SHEIN. One thing that is striking is that Temu surpasses SHEIN in how much it spends on marketing and advertising. To put a little perspective, in this year’s Superbowl Temu invested in 3 ads during halftime (the most expensive TV ad space in the US, worth $7 million for 30 seconds on air in 2024) and 2 more ads after the end of the game.
It is clear that Temu is focused on gaining market share, even at the expense of its profit margins, in order to displace competitors that cannot keep up with its low prices and aggressive marketing in the short term.
How does Temu justify its low prices?
Temu explains that its low prices are made possible by connecting suppliers directly to their customers, eliminating the need for intermediaries and saving on logistics and manufacturing costs, as well as saving on shipping times. All this sounds idyllic, doesn’t it?
One of the biggest concerns that emerged around the platform’s success is related to Pinduoduo. This is another Chinese e-commerce owned by PDD Holdings, which is the parent company of Temu. In 2023 it was demonstrated that Pinduoduo app contained malware that allows not only access to the device data on which was installed but also to spy other apps content. After these findings the app was retired from the Google’s Play Store for few days. Yet, a slight suspect remains on whether the purpose of the low prices’ tactics and free coupons of Temu are to obtain as many users as possible as potential buyers, or to be able to obtain access to their data…
On the other hand, just like SHEIN, it’s barely impossible to find information about Temu’s suppliers or to verify the authenticity of the little that is available. This generates a concern about its possible participation in labor exploitation and modern slavery.
In Latin America, Temu is already operating with shipment to Mexico and Chile. However, Tik Tok is flooded with videos with tips to able to place orders to countries where it is not operating yet such as Colombia and Venezuela. Also, there are “entrepreneurships” that place massive orders and deliver them.
Currently, marketing of what is excessively cheap and free is still succeeding. Even though there is a large amount of available and accessible information about the implications that ultra-fast fashion companies —such as SHEIN and Temu— have in the environment, in persisting modern slavery, and at the expense of ethical and local industries, the marketing of the excessively cheap and free continues to triumph.
In this age of “microtrends” and immediacy, it is more important to people the capability of quick access and at low cost to articles that allow them to belong to the core or aesthetic in vogue, losing quality over quantity. SHEIN and Temu know how to use this wisely for their own advantage.
