Temu invites US and European sellers to its platform

 

It’s been a year since Temu burst onto the scene of e-Commerce and became world-famous with its highly popular Super Bowl ad in 2023. Now, just in time for this year’s Super Bowl, the rapidly growing Chinese e-Commerce app makes a bold move and invites US and European sellers onto its platform starting from 15 March.

 

Broadening its seller base this way seems to be an interesting choice for Temu, considering that the marketplace has based its success on low-priced goods sourced directly from China. If we take a look at Temu’s statistics, it seems that this strategy has paid off so far.

 

Screenshot of temu.com’s homepage

 

Temu’s year 2023 in numbers

Temu’s popularity is still soaring among mobile shoppers. In the first half of January 2024, the Temu app was downloaded over 31 million times worldwide, surpassing Amazon’s marketplace app.

 

The marketplace’s estimated yearly revenue for 2023 is around $6 billion, with a monthly GMV of $1 billion. More than 40% of all downloads originate from the US, where Temu now has a 17% market share in the category of discount stores.

 

Temu is no stranger to Europe: the marketplace has already established a delivery network on the continent via business partnerships in Germany, Italy, Spain and Portugal. The platform also has offices in Ireland.

 

With such a sound basis on Western markets, the stage seems to be all set for US and EU retailers to join the Temu shopping app. The question is though: is it worth it for them?

 

 

To join or not to join?

As with any marketplace entry, there’s an array of pros and cons brands and sellers have to consider before arriving at a decision.

 

On the one hand, Temu has a giant audience that’s growing as we speak. Getting in front of that many consumers can definitely contribute to your chances of widening your audience and enticing new customers for your brand. It may also make sense to broaden your sales channels and add new outlets for your products.

 

On the other hand, however, there’s Temu’s less-than-stellar reputation. The marketplace is known for lower quality, extremely cheap goods, and openly encourages overconsumption. This outdated, “throwaway economy” is very bad for the environment; no wonder that a growing number of consumers are turning away from it and looking for a more environmentally friendly, circular economy.

 

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Another important factor is the way Temu operates. There’s a great price pressure on the marketplace; vendors try to grab consumers by offering even lower prices than their competitors.

 

As a side note, we have to add that Chinese Temu sellers often save money by underdeclairing the value of their products to cut the costs of import customs and taxes. Goods under the value of 150 euros are exempt from customs and taxes in the EU, which prompts many sellers to claim a lower value than realistic. This is a point in favour of European sellers, since they are naturally exempt from import duties and customs within the EU.

 

In addition, sellers often engage consumers in games, sweepstakes, giveaways, flash sales, or any other means to get their attention. This kind of marketing may require a higher amount of time investment than European sellers are used to.

 

Screenshot of a random collection of free and giveaway items on Temu.com

 

And let’s not forget about Temu’s reputation. The marketplace’s cheap goods are quite often bad quality and may even infringe on somebody else’s IP rights. Surrounded by product listings like these, your own products may suffer a serious loss of reputation just because they’re placed next to each other.

 

Find out why a clean marketplace matters and how to ensure one for your products!

 

Another issue you need to look at is the amount of assistance you can get from a marketplace. While Amazon, eBay and many others offer various kinds of assistance from warehousing, fulfilment, dropshipping to payments and customer service, Temu announced that sellers will have to set up logistics at domestic warehouses. In addition, Temu won’t provide any assistance with pricing or marketing.

 

These tasks are far from easy. Brands with no prior experience in these areas may find it difficult to cope with these tasks, should they choose to work with Temu.

 

Since the opening date is set for 15 March, we don’t know at this point how many US and European sellers have taken the plunge and set up shop on Temu. It may be interpreted as a warning sign though that when AliExpress (a marketplace with a very similar approach to Temu’s) tried the same move, it wasn’t very successful in attracting European sellers to its platform.

 

We’ll check back later in the year to collect and share the first impressions of Western sellers on Temu.

 

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Running a test purchase on Temu

 

Online brand protection on Temu

Whether you decide to set up shop on Temu or not, you may find that your brand’s products (or fake versions of them) are already present on the marketplace. Unfortunately, fraudsters seem to flock to discount marketplaces where their infringing goods fit just right in with other low-priced products of questionable quality.

 

globaleyez’s marketplace monitoring service is just the right solution for that problem. With keyword-based monitoring, we can check over 150 marketplaces worldwide for product listings that use your brand name, product name, or any other word that may mean it’s infringing on your IP rights.

 

But counterfeit goods are not the only ones you should keep an eye out for. Indeed, grey market products (authentic goods sold outside of your authorised distribution network) can be just as damaging to your brand, because they create distrust amongst your authorised sellers and heavily distort your price structures.

 

But how are grey market products created? One of the main ways is when a business partner doesn’t hold themselves to your agreed terms. So, for example, if you decide not to allow your products on Temu, but one of your sellers may go against your orders and list your products anyway. This is why we developed our partner compliance service, to detect if your business partners conduct themselves according to your agreement.

 

The detection and removal of infringing, lookalike, grey market, etc. product listings means that your authentic listings will enjoy a clear environment, without fraudulent and dodgy goods tarnishing their appearance. This is called a clean marketplace, and it’s essential for ensuring your brand’s continued excellent reputation.

 

It’s not always clear from a listing alone where an infringing product comes from. In that case we recommend a test purchase to learn as much about the seller and the origins and nature of the product (e.g. is it fake or grey market) as possible.

 

Finally, we can enforce your rights and demand the removal of the infringing listing from Temu, or anywhere else online.

 

 

Conclusion

Whether you’re entering Temu or not, your IP rights may face certain dangers on the marketplace. Contact us and find out how we can work together for the optimal protection of your rights on Temu and anywhere else online.