Temu Surpasses Shein in App Store Dominance Across Japan and South Korea
In an astounding shake-up in the fast fashion e-commerce landscape, Chinese retailer Temu, a subsidiary of Pinduoduo PDD, has eclipsed its rival Shein's presence in the mobile app marketplace of Japan and South Korea. This significant development follows an aggressive push by Temu into these Asian markets coupled with its prior growth in Western economies.
The Ascendancy of Temu
Temu has made headlines by dominating the shopping app download rankings on both iOS and Google Play stores. This surge in popularity reflects a broader strategy of expansion as underscored by Goldman Sachs in an October report, which highlights Temu's swift international rollout and impressive transaction values that exceed $1 billion monthly. Compared to Shein's anticipated $30 billion transaction value in 2022, Temu continues to bolster its market position and is forecasted to maintain its growth trajectory through the second half of 2023.
Metrics from app analytics firm data.ai further illustrate Temu's dominance, particularly in Japan and South Korea. In Japan, Temu's app topped the daily download charts for an astounding 101 out of 124 days following its July debut, leaving Shein and other competitors like Mercari and Amazon AMZN trailing significantly in terms of download days and the speed to reach milestones such as four million downloads.
In South Korea, similar patterns emerge with Temu achieving the number one ranking for 65 out of 93 days starting from August, outperforming Alibaba's BABA AliExpress in the process. Temu also set records in the South Korean market for the swift attainment of two million app downloads.
Corporate Rivalries and Market Strategies
The intense competition between Temu and Shein has transcended market dominance, spilling into legal disputes over intellectual property and exclusive manufacturing agreements. However, recent legal developments indicate a cessation of these lawsuits, reflective of the dynamic and competitive e-commerce sector.
Backed by its parent company Pinduoduo Inc. PDD, which has solidified its presence in the global e-commerce space, Temu owes its acceleration to a potent combination of strategic marketing investments, affordable pricing, and popular promotional campaigns, as noted by Citi C and Bernstein analysts. Meanwhile, the marketing prowess of Alphabet Inc. GOOG as a leading global technology entity continues to shape online consumption patterns. Furthermore, investment banking giants such as Citigroup C and The Goldman Sachs Group GS, underscore the growing relevance of e-commerce trends shaping market opportunities.
Regulatory Challenges and Future Outlook
Despite their remarkable expansion, companies like Temu and Shein have encountered scrutiny from U.S. regulatory bodies concerning import tariff laws and ethical business practices. Nonetheless, the momentum of Temu is expected to forge ahead, driven by an increase in active users and order volumes, both contributing significantly to its non-U.S. transaction value and overall growth.
Temu, Shein, Ecommerce, AppStore, PDD, Expansion, Asia, Fashion, Retail