What is Temu, and should you let your parents order it?
Temu and Pinduoduo: “Notorious Markets for counterfeit and piracy,” says a U.S. spokesperson
When asked about those claims, Temu’s spokesperson told NPR, “Merchants who have developed economies of scale and demonstrate cost efficiency thrive in Temu’s environment. Their ability to offer competitive prices, driven by reduced production and operational costs, are rewarded by consumers looking for that combination of price and quality.”
Pinduoduo became the parent company of both Temu and PDD last year after changing its corporate name. The market cap of the company at the end of stock trading last week was $169.37 billion.
The Pinduoduo app and website are on the U.S. list of “notorious markets for counterfeit and piracy” for a number of years.
“On average, some of them are going to be exactly the same, some of them are going to be coming from exactly the same sellers” that consumers might find at other retailers, The Atlantic’s Mull said last year. “Others are going to be a little bit junkier. substandard materials might not always pass muster in the US for safety standards.
There is a class action lawsuit accusing the parent company of Temu of collecting user data beyond what is necessary for an online shopping app.
Temu’s Super Bowl ads promise to let people “shop like a billionaire” — and they’ve helped the Chinese-owned online discount marketplace expand in the U.S. at a breathtaking pace.
The House Select Committee on the Chinese Communist Party said the import method reduced the chances that Temu’s packages would be screened for compliance. There are reports of human rights abuses against the Uyghur minority in China’s Xinjiang region.
“Both Temu and Shein rely heavily on the de minimis exception to ship packages directly to U.S. consumers,” a congressional review found last year, “allowing them to provide less robust data” to Customs and Border Protection and avoid import duties.
If you want to impose duties, you should call the rule de minimis, because it is too insignificant in value. The threshold differs around the world; in the European Union, it’s 150 euros (about $160). The U.S. level went up to $800 in 2016 thanks to the Trade Facilitation and Trade Enforcement Act, which was signed by Barack Obama.
Temu, Pinduoduo and Amazon: Making the “Temu Fat” Part of the Chinese Retail Era Worked
Temu has reportedly been undercutting its competitors’ prices, absorbing losses to win over customers, according to an analysis by China Merchants Securities that was cited in Chinese-language financial news media and by Wired. Recent reports have also alleged that Temu has pressured sellers to keep prices low.
But Temu has quickly made inroads — one metric of the retailer’s impact is U.S. mail carriers, including one who recently described to Forbes the phenomenon called being “Temu tired,” as she seemingly delivers more of the company’s orange-labeled packages each day.
The company recently reported $170 billion in net quarterly sales, the majority of which were from its online stores and third-party seller services.
Temu focuses more on cheap home goods and plasticware than it does on clothes. It is one of the biggest threats to Amazon’s domination.
Pinduoduo, a huge Chinese retailer of food and produce, implemented a model similar to Temu’s that made connections easier in China’s food sector. More than 16 million farmers were allowed to sell produce to 884 million consumers who visited the platform in 2022, according to the U.N. Food and Agriculture Organization.
“Dispatching goods directly from the source eliminates the need for multiple stages of transportation and warehousing,” a Temu spokesperson told NPR, “addressing what is often the most significant expense and inefficiency in conventional retail operations.”
Temu aggressively markets “hot deals” — such as a hooded button-up fleece jacket currently going for $8.32 or a car-mounted vacuum cleaner selling for $13.48. Eye-catching prices like those are frequently cited in its online ad campaigns.
In less than a year, the business spun up an online retailer which is 75% of the size of Target.com, according to The Atlantic.
