Temu Surpasses Shein in App Rankings, Leading in Japan and South Korea
Amid the competitive landscape of fast fashion e-commerce, Chinese retailer Temu has emerged as a dominant player in app stores across Japan and South Korea, surpassing its rival Shein. Temu, which is a part of PDD, has leveraged its parent company's influence to expand its market share rapidly, especially after cementing its success in Western economies.
Rise to the Top
Reports from Goldman Sachs on October 4 highlight Temu's swift rise, estimating the retailer's monthly transaction value to be over $1 billion and projecting sustained growth into the latter half of 2023. Concurrently, Shein's estimated transaction value for 2022 hovered around $30 billion, according to media sources.
App analytics from data.ai reveal that since Temu's July launch in Japan to November 2, it maintained the number one spot in daily iOS and Google Play shopping app downloads for 101 out of 124 days, compared to Shein's 17 days at the top in the same timeframe. In South Korea, Temu led the pack for 65 days out of 93, from August 1 to November 2. Correspondingly, Temu reached four million downloads in Japan significantly faster than Shein, marking its growth trajectory.
Legal Battles and Market Expansion
The rivalry between Temu and Shein isn't confined to market dominance; it extends to the courtroom with mutual allegations of intellectual-property infringement. However, recent developments indicate that both parties have sought to end their legal disputes.
Temu's involvement in the Asian market began with Japan and South Korea, and it swiftly continued through the Philippines and Malaysia. This aggressive expansion is backed by MRCIF's intricate supply chain and marketing strategies.
Financial Analysts Weigh In
Analysts from Citi, under C, attributed PDD's robust growth to Temu's performance, noting a 131% year-on-year increase in transaction service revenues in the second quarter of 2023. Bernstein analysts, representing GS, echoed these sentiments, attributing Temu's success to substantial marketing investments and aggressive promotional strategies. They forecast increasing contributions from Temu to PDD's non-U.S. transaction value.
Alphabet's Role
With Temu's substantial presence on both iOS and Google Play stores, the significance of Alphabet GOOG, which owns Google, becomes evident. As the world's fourth-largest technology company, Alphabet plays a crucial role in the distribution and access of digital platforms like Temu.
In conclusion, Temu's ascendancy in Japan and South Korea is indicative of the shifting dynamics in the fast fashion e-commerce market. The company's strategic moves and backing by influential players in technology and finance reiterate the competitive nature of this industry sector.
Temu, Shein, eCommerce, PDD, MRCIF, GOOG, C, GS