When the domestic market is becoming saturated, Pinduoduo began to seek a second growth curve, and its independent cross-border platform Temu finally appeared in front of everyone. This article experiences Temu and explains its product functions and its cross-border overseas travel situation. Temu chose to go overseas at this time and used low prices as his Maojian. Is it the best solution for Pinduoduo?
Pinduoduo's independent cross-border platform finally appeared in front of everyone.
, the platform launched on September 1, is called Temu. The official explanation is "Team up, Price Down (buy in teams, low price)". The origin of the name is compared with the advertising slogan of Pinduoduo in China, "Buy with teams, it's cheaper", which makes many people think that this platform named Temu may also copy the gameplay of "group buying" and "Sharp a Knife" overseas. However, in the report "Late" mentioned that Pinduoduo will not launch the "Sharp a Knife" function for the time being.
From Temu's App and PC side, it mainly focuses on "low prices" and "multiple products". The supplier told "e-commerce online" that the supply price required by Temu is lower than that of 1688 and SHEIN. Many suppliers choose to settle in because they are interested in the traffic brought by the new platform. The
market is so concerned about Pinduoduo going overseas because of its rare cross-border e-commerce experience. At the same time, the first stop was to choose the United States, which has a high threshold and the most developed e-commerce. How to get a card on the crowded tables of Amazon , 1688, TikTok and other platforms? This series of questions needs to be answered.
Many people use it to compare with SHEIN. There is news that Pinduoduo has high salaries to poach SHEIN employees online. However, compared to the former focusing on women's clothing strategy from the beginning, Temu chose the entire category from the beginning and paid more attention to the supply chain advantages of its white brand. All signs indicate that Temu is more like using the SHEIN model to create an overseas version of Pinduoduo.
At the call for Pinduoduo 2022 second quarter financial report, CEO Chen Lei talked about this overseas project for the first time, "I will not simply repeat what others have done, and overseas business is not achieved overnight." When the domestic market gradually became saturated and Pinduoduo, which has been striving to find the second growth curve, did not keep up with the train in the live e-commerce and local life tracks, and turned its attention overseas. Chen Lei's "overseas business has the possibility of creating new value" is an expected choice for Pinduoduo, which is facing a bottleneck in traffic growth, and is also a choice that has to be made.
1. 1 point purchase flat-out "Kill a Knife"
Open Temu's PC and App. The most prominent center position on the homepage is the discount area for newcomers and newcomers coupons.
Temu home page pushes newcomers 30% off coupons in the
discount area, many products are priced at $0.01 and have free shipping. Aya, who studied in the United States, told "E-commerce Online" that Temu had a return-to-school season activity for new users before, and many products in the activity area are given for free. Although
did not "cut a knife", Temu chose to do social fission through the model of attracting new users to issue commissions. On overseas social platforms, some users said, "As long as new users accept my Temu invitation, I can get a commission of up to US$50."
At the same time, Temu chose Halloween as the entry point. Comparing "E-commerce Online" found that cross-border platforms such as Amazon, AliExpress, SHEIN and Wish did not promote Halloween as the main promotion. Temu may be to differentiate from other platforms in terms of topics, and at the same time can conduct time node marketing on foreign holidays.
Temu mainly promotes Halloween event
declines to Temu's homepage, and there will be "flash sale" and "below $3.99" sections. It can be seen that Temu's current focus is on low prices or cost-effectiveness. The jewelry storage box of $0.29, the Halloween badge of $0.41, and the Bluetooth headset of $3.79 are all popular products. Judging from the hot-selling products and recommended products on the platform, most products are priced between US$0.09 and US$20, and the platform is positioned as "middle- and low-end consumers."
It should be noted that these seemingly low prices are not the final prices. New users can also receive a 30% discount coupon for use, and the final price will be lower than the page shows. With such a low price, Temu has also launched free delivery and free return services within 90 days, attracting many consumers.
At present, Temu's categories are mainly concentrated in home furnishing department stores, women's clothing, fashion accessories, 3C digital accessories, children's clothing and office supplies. Da'an said that Temu is a full-category investment promotion, but "they will give priority to factory-based merchants with supply chains because these manufacturers can provide lower prices."
Temu's product sales ranking
Temu also explained the low price, saying that it is a sister company of Pinduoduo. "Working closely with the same global supplier and manufacturer community to provide consumers with various products at the lowest price possible."
has the background of a large manufacturer and the possible traffic advantages in the early stage, and Temu has high requirements for suppliers. Daan revealed that the supply price of the Temu platform will be lower than that of the domestic supply price. "When selecting products, it is said that it is 10%-20% lower than that of 1688 and other platforms to be considered 'sincere'. If the product has the same model on the SHEIN platform, the price will be lower than SHEIN." At the same time, the supplier only needs to provide the product to the Guangzhou warehouse, and the remaining fulfillment process will be completed by Temu.
On the platform, clicking on a single product can see which supplier comes from above the details page. Consumers can also click on the store homepage to view store reviews and all products in the store, and choose to follow the store. According to rough statistics from the reporter, the main home furnishing department store category has nearly 3,000 SKUs and more than 70 suppliers, while the women's clothing category has more than 3,000 SKUs and more than 50 suppliers.
From a logical point of view, Temu is different from the domestic Pinduoduo model and overseas SHEIN model. While highlighting low-priced goods, it also provides options to pay attention to merchants, similar to central-style shelf e-commerce. There are also some brands like Lenovo ( Lenovo ) and Nuaturehike (Nuoke) on the platform, but most of the products are still white-branded merchants.
naturehike (Neke) store on Temu
At present, the best sellers on Temu are all kinds of home furnishing department stores, and department store products are also promoted on official websites and apps. The official promotion and distribution on Instagram is still mainly fashion. The reason may be that the user coverage of fashion users is wide and the volume is fast, which helps the new app spread through users, and it is easier to reach the young and sinking market groups and circles that Temu wants to target. Fashion products are also easy to plant grass through overseas social platforms and then reach transactions.
. In home department store products, Temu adopts different publicity methods. Overseas users of Xiaohongshu said that they had received promotional needs from Temu, and publicity also needs to highlight "low prices" and "department store categories".
2. Use SHEIN mode to do Wish
Previously, many people compared Temu with SHEIN. Overall, the two are indeed similar.
1. In the early stage, the low-price strategy was adopted, and the suppliers were mainly factory-oriented merchants. factory-type merchants can reduce the intermediary links and provide more advantageous prices. Overseas users of Xiaohongshu said that although Temu currently has not many products, the prices on some same products will be lower than SHEIN;
2. Buyer review system. Temu is the same as SHEIN, which makes all categories of products. There will be sample selection and sample delivery, and the buyer will decide whether the product can be successfully put on the shelves and sold. The platform will have quality requirements for the product. If there are quality problems, the merchant will be fined;
3. The merchant is responsible for supply and has no pricing power, and the platform is responsible for the pricing and fulfillment process. Like SHEIN, Temu has set up a warehouse in Guangzhou. Merchants only need to stock up in the warehouse through product selection, and Temu is responsible for the subsequent pricing and performance process within the platform.
From the beginning of the platform, it has adopted strategies such as full categories and low prices. Temu is actually more similar to Wish, which is known as the "American version of Pinduoduo".
Wish's official website
Wish is an e-commerce platform established in 2010. It provides low-priced full-category products, targeting low-cost consumer groups in the United States, with the price of products as low as USD 1. About 94% of the sellers on the platform come from China. On December 16, 2020, Wish's parent company was successfully listed on Nasdaq , and Wish also became the third largest e-commerce platform in the United States after Amazon and eBay.
But in 2021, Wish's revenue fell by 20.7%, and monthly active users also continued to decline, from more than 100 million monthly active users in 2020 to 27 million monthly active users in 2022. The main reason for the decline in revenue and traffic is the quality and safety of the product, and the decline in consumer trust.
Wish is gradually abandoned by consumers, but its early success has allowed everyone to see the potential of the sinking market in Europe and the United States.
Attest's "2022 US Consumer Trends Report" shows that 32% of Americans said they are currently "cautious" in spending, while 16% said they are currently "cautious" in spending, that is, a total of 49% of Americans choose to remain cautious in spending, and they will have higher interest in lower-priced products.
This can also show the development of Dollar tree (USD Tree) in the United States and the development of China's cross-border e-commerce SHEIN: the USD Tree, which focuses on the price of 1 USD, has department stores such as food, decoration, household goods, pet supplies, etc. It has 15,900 stores in the United States, and in 2021, the profit of reached 1.342 billion US dollars. SHEIN, which focuses on low-priced and fast fashion, has increased its revenue in 2020 by year-on-year compared with in 2019, breaking the 10 billion US dollar mark. In the first half of 2022, the sales of SHEIN, which began to deploy all categories, reached 16 billion US dollars, a year-on-year increase of 50%.
Temu adopts the SHEIN model for Wish and online Dollar tree, and uses the buyer review system and unified delivery of domestic warehouses. In fact, it ensures the development of the platform ecosystem to a certain extent and avoids the occurrence of Wish.
3. Cross-border overseas trip, what is the best solution for Pinduoduo?
is not the first time Pinduoduo has done cross-border. Founder Huang Zheng Previously entrepreneurship was related to cross-border. This time, choosing the United States as its first stop to go overseas instead of choosing Southeast Asia where other e-commerce options go overseas, also has its own considerations, or this is a choice that has to be made:
Starting from Pinduoduo's Q2 financial report in 2020, the number of monthly active users has shown a downward trend in the quarter on a quarterly basis. With domestic traffic reaching the peak and starting to operate existing users, there may still be opportunities in the foreign sinking market. Pinduoduo's choice of cross-border overseas is more like a choice that has to be made, wanting to find new increments.
JJ’S House founded by Huang Zheng in 2010, Huang Zheng founded the cross-border wedding e-commerce brand JJ’S House, and later became the world’s largest wedding e-commerce company. The VOVA "European Pinduoduo" established in 2018 also has close ties with Pinduoduo. In the report of "Late" mentioned that a VOVA employee said that the company's management conveyed an idea in early 2018: VOVA surpassed Wish in about three years, and then Pinduoduo will acquire VOVA and become the Pinduoduo international e-commerce department similar to Alibaba AliExpress. It can be seen that Pinduoduo has already begun to plan cross-border e-commerce. This time, Temu is not a test or a playful vote, but more like a well-thought-out long-term choice.
chose the United States because the e-commerce market is large and the users are relatively mature. Data from the US Department of Commerce shows that in the past year, e-commerce sales in the United States have reached US$975 billion, making it the second largest e-commerce market after China. Attest research shows that 37% of Americans always shop online, 30% of Americans choose to shop online and offline frequently, and their shopping habits are more inclined to the Internet, and the sinking market in the United States has not yet emerged as an e-commerce giant.
7% Americans are used to online (online shopping) When major domestic e-commerce companies are looking for the second growth curve, Alibaba has laid out Alibaba Cloud , JD has made efforts in logistics and supply chains, and Pinduoduo has successively missed the opportunity of live e-commerce and local life. Cross-border is already one of the few good tracks. At the same time, avoiding Southeast Asia where major e-commerce layouts are located, the US market may become a better choice for Pinduoduo.
is just that the low-price, white-brand supply chain, and social fission gameplay are not simply copied overseas with different cultures and consumption habits.
Many cross-border merchants have stated that compared to domestic users’ habits in browsing and placing orders on the App, foreign consumers prefer to choose PC to place orders on the web. Many cross-border merchants have established their own independent websites, and Temu’s App does not have an advantage.
Cross-border e-commerce has been promoting bonus period for several years. Now the promotion costs of the platform and internet celebrities are increasing. The newly established Temu still needs a large-scale promotion and publicity. The recruitment platform shows that Temu is still recruiting overseas KOL media operations and requires employees with overseas promotion and distribution experience.
At the same time, Temu is mainly shipped in Guangzhou warehouses, and the logistics time is uncertain. In contrast, SHEIN is ready to establish a warehouse in the United States and plans to shorten the logistics speed to 3-4 days.
Los Angeles lily placed an order for one cent for newcomers, and the order was cut due to "out of stock". However, she found that Temu was still selling related products. When asked about relevant information about some products of customer service, she could also feel that the customer service responded slowly and failed to give a clear reply to some questions.
"Maybe it's because the manpower is not too busy. What we learned is that buyers, investment managers and customer service are still recruiting," said Da'an.
In different environments, Pinduoduo sister version Temu chose to go overseas and chose "low price" as its sting. However, when Amazon, SHEIN, AliExpress and other independent sites have begun to pay attention to the sinking market and join the full category competition in the sinking market, whether Temu can continue to run the Pinduoduo model in the United States will take time to confirm.
Author: Wang Zheng; Editor: Siwen
WeChat public account: E-commerce online (ID: dianshangmj), see sharpness, insight, and innovative media focusing on the Internet and new business.
This article is published by the cooperative media of Renren Product Manager @E-commerce Online. Reproduction is prohibited without permission.
question diagram is from Pexels, based on the CC0 protocol.
The views in this article only represent the author himself, 人 are both product managers and only provide information storage space services.
