The race to bring Chinese-made products to Western consumers via online stores is heating up. Pinduoduo, the Chinese e-commerce giant known for offering hard-to-believe deals, quickly gained momentum for its first international venture in the United States
The company’s overseas shopping app, called Temubriefly claimed the top spot for Android shopping apps in the US in mid-September before plunging to No. 15 this week, according to Data.ai application analytics platform. Leaderboards indicate new downloads, so it’s difficult to gauge app retention and user activity.
At a glance, Temu doesn’t look much different from other e-commerce platforms exporting cheap goods from China, like Amazon, Alibaba’s AliExpress or Wish. Its landing page features a dazzling collection of competitively priced products, ranging from a $2.77 blouse to a $1.39 soap dish.
Pinduoduo is relatively late in the cross-border e-commerce scene. In almost every major market outside of China, one can find an online retailer that imports goods directly from Chinese suppliers or manufacturers. Lazada, owned by Alibaba, and Shopee, backed by Tencent, are well established in Southeast Asia. AliExpress is a popular option in Russia. Shein, the fast fashion e-commerce site with an expanding product category, is the go-to shopping app for young people in Europe and the United States
Temu’s advantage over its competitors could be its extensive links with factories in China. Founded in 2015, Pinduoduo quickly rose to challenge the dominance of Alibaba, which began more than a decade before it. The company’s meteoric rise has been attributed to a shrewd strategy of connecting manufacturers directly to consumers, cutting middleman costs, and ultimately allowing it to price products far below those of dependent rivals. layers of distributors.
It looks like Pinduoduo will continue to build on his strength as he goes overseas. Just this week, the firm announcement that it will invest “tens of millions of RMB” in “cultivating 100 export-oriented brands”. In doing so, the initiative aims to help 10,000 domestic manufacturers sell globally.
Temu has a head start in sourcing products through Pinduoduo’s supply chain resources, but it may struggle to replicate the success of the user acquisition strategy that has enabled the rapid growth of Pinduoduo at home. In its early years, Pinduoduo relied heavily on its investor Tencent’s WeChat app, where users shared offers with friends to get discounts on products.
The setup worked because WeChat transformed itself far beyond a messaging app, with a built-in mini app ecosystem that seamlessly integrates with its social features, a user scenario that lacks in Western equivalents such than WhatsApp.
Temu could also face the same set of challenges that trouble Shein. The fast fashion start-up has been repeatedly criticized for its opaque supply chain practices and accused of infringing intellectual property. In 2019, the United States added Pinduoduo to its notorious blacklist of suspected counterfeits, despite the company pledging to crack down on counterfeits.