The Temu app, a subsidiary of the Chinese e-commerce giant Pinduoduo, is on track to surpass global leader Amazon in downloads this year. As of August, data from SensorTower shows that Temu has emerged as the third-largest e-commerce platform in terms of user base, reaching 91% of Amazon’s user numbers. Experts predict that Temu could potentially outpace Amazon, which has established a presence over the last 30 years, by the end of this year.
Additionally, a report from Global Wireless Solutions (GWS) indicates that by June 2024, the average U.S. user of Temu is expected to spend around 23 minutes per day on the app, significantly more than Amazon’s 11 minutes or Shein’s 12 minutes. This suggests that users are increasingly engaged with the Temu platform.
Temu’s impressive download figures are complemented by its ability to extend the duration of customer engagement, effectively boosting user loyalty. So, what’s driving Temu’s swift rise in popularity? The most evident factor is the platform’s remarkably low prices, which have drawn in consumers from diverse regions.
A report from Japan’s Yomiuri Shimbun highlights an intriguing case: a male police officer in his 50s from Hyogo Prefecture became so captivated by Temu’s “cut a deal” feature—where users can invite others to negotiate prices—that he enlisted 21 subordinates to help him secure gifts. He defended his actions by pointing out that Temu’s offerings are “very cheap” and that he wanted to share this benefit with everyone.
Temu’s low-price approach is primarily driven by two factors: First, it focuses on selling a substantial volume of non-branded products, which reduces intermediary costs and helps maintain lower prices. Second, the app capitalizes on various tax exemption policies for low-priced goods when exporting from China, allowing for nearly wholesale pricing for customers abroad.
