Next came Temu. It is a subsidiary of PDD Holdings, a multinational commerce group with extensive experience managing supply chains. Another of PDD Holdings’ subsidiaries, Pinduoduo, began as a platform to sell fresh produce and broadened to other manufactured products. While Pinduoduo operates in China, Temu launched in the United States in September 2022 and in Europe in April 2023.
Temu uses software to match China’s manufacturing capacity to demand in the United States and increasingly the rest of the world, in more than 250 product categories. Where Shein has 6,000 tightly integrated producers, Temu has more than 100,000, offering a much wider range of goods at startlingly low prices. An electric cooking pot sells for US$2.14 and a swimsuit for US$6.18, with free shipping.
Temu attributes these prices to direct shipping from factory in China to consumer in the United States, bypassing wholesalers and retailers.
Another new platform from China is TikTok Shop. Building on the largest audience in the world for short-form media, TikTok Shop uses what it knows about its viewers’ tastes to help Chinese manufacturers find worldwide markets.
China used to lag behind Japan and South Korea in consumer brand building. Many thought that China might lack the sensitivity to Western cultural nuance that Japan and South Korea had mastered.
It turns out that algorithms, running on platform technology, can do the job. China is building household names in retail and media at a bewildering speed.
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