Temu and Shein are reportedly Amazon’s biggest competitors. The Seattle-based giant is working on improving delivery speed following the growth of its Chinese rivals.
Temu’s and Shein’s significant base growth
The Chinese e-tailer Temu was launched in the U.S. in 2022, and in January 2024, it had a 51.4 million user base. More known, Shein gathered 26 million users compared to the previous 20.9 million. This reportedly raised more concerns for Amazon than domestic competitors, such as Target or Walmart.
Amazon suffered a slight decline
The Wall Street Journal reported that Amazon experienced a decline from 67 million to 69.6 million in the same time frame. The report came after an analysis from Sensor Tower. The Seattle-based company responded that they thought they watch competitors, but their main concern is their users.
Amazon’s logistics
The company added that in 2023, they delivered over 4 billion items to Prime members in the U.S. on the same day or the next day. Josh Lowitz, co-founder of Consumer Intelligence Research Partners, called Amazon’s logistics “unapproachable.” He added that competing with the retail giant will take time because of the company’s infrastructure and volume.
Temu is among Meta’s biggest advertisers
The Chinese company is one of the top advertisers on Meta and Google, and its parent company, PDD, spends nearly two billion on these platforms. PDD also spent over 20 million on three 30-second ads during the Super Bowl.
Allegations and lawsuits
While Temu and Shein enjoy great popularity over their cheap goods, there are thousands of complaints. Temu also faces two lawsuits regarding its app, alleging it contains dangerous malware and spyware. The two companies send almost 600,000 packages to the U.S. every day.
Shein’s power
The fastest-growing fast fashion chain, Shein, owned by Chinese entrepreneur Chris Xu, adds around 6,000 products daily on its website. Bloomberg reported that the company is now valued at nearly 70 billion and ships to users in over 150 countries.
Shein surpassed Zara and H&M
The staples of fast fashion, Zara and H&M, dominated the market for over two decades, but Shein’s prices and incredibly fast technology for identifying trends left the competition in the dust. In 2022, Shein was worth more than Swedish H&M and Spanish Zara combined. Part of the success of this fast fashion giant is its presence on TikTok and so-called Shein hauls.
TikTok e-commerce
TikTok Shop was launched in the U.S. in September 2023 after ten months of testing. TikTok executives confirmed to The New York Times that more than 90% of TikTok Shop’s sellers were not US-based. TikTok aims to use its power of over one billion users to take over buyers from Temu, Shein, Amazon, and others.
Temu and Shein have an interesting relationship
In December 2023, a lawsuit by Temu alleged that Shein had deployed increasingly aggressive strategies to “illegally interfere” with its business. But this is only one of numerous clashes between the two companies.
Temu vs. Shein
As Bloomberg noted, Temu previously accused Shein of bullying manufacturers, while Shein accused Temu of instructing influencers to make false statements about the brand. The lawsuits were quickly dropped.
Amazon to improve delivery speed
Amazon is reportedly working on improving impressive logistics, including speed. The company already uses AI to analyze and plot delivery routes, adapting in real-time to traffic and weather conditions.
Shein and Temu at Congress
In June 2023, a Congressional report criticized Temu over potential forced labor. The report came months after an anonymous alliance of brands and human rights organizations began meeting with congressional offices to increase scrutiny on Shein.
