To mark the anniversary of its entry into the US market, Temu a shopping platform owned by Chinese e-commerce heavyweight PDD Holdings Inc., has set a lofty sales target for its North American business – to report at least a single day of gross merchandise value (GMV) above Shein until September 1, according to inside sources.
PDD, which was successful in making inroads into the lower-tier markets of China, hopes that the app will drive long-term overseas business and dominate the online shopping landscape.
Shein might be the app’s biggest near-term rival, but Temu aims to ultimately take on the likes of Amazon and eBay, according to people in the firm.
Temu has already bagged the goal of being the most downloaded app on Apple’s US app store for the past few months and achieved US $ 500 million GMV in the US during the first five months of operation, according to data analytics firm YipitData. Data also shows that the sales for the firm were nearly US $ 200 million in January.
A senior analyst at app tracker Sensor Tower, Abe Yousef said that the app’s formula of low prices and frequent flash sales has proven critical to its success. The app has gathered nearly 11 million monthly active users as of January and has been downloaded 24 million times since inception, as an estimate by Yousef.
“Given the current challenging macroeconomic environment and the backing of parent PDD Holdings, Temu is well-positioned to continue its aggressive growth strategy among US consumers,” he said.
Staff at Temu are not given daily sales targets, but they have been told to instead, shift from growing the user base to devising ways to boost customer spending.
Temu is viewed as the most serious competitor for Shein and the former is actively engaged in trying to upstage Shein by leveraging the deep pockets, extensive supply chains and expertise — particularly in consumer data that allows rapid changes in offerings — of parent PDD which already controls roughly 13 per cent of Chinese online retail through its Pinduoduo platform.
Temu is betting on huge marketing campaigns to drive sales growth. It debuted advertisements at the US Super Bowl and is rolling out social media strategies which include offering discounts, cash rewards and free gifts to customers who refer their friends.
