Temu is in the spotlight this month as Germany’s retail association, Handelsverband Deutschland (HDE), calls on politicians to implement stricter e-commerce regulations and strengthen custom processes.
This means every purchase made from a digital platform would be registered before entering the country. The reason? The HDE says it would level the playing field if all digital e-commerce platforms “adhered to the same rules.”
It’s not the first time Temu made headlines for fair play. In 2022, Shein accused Temu of teaming up with influencers to “belittle Shein on social media.”
Navigating the Temu challenge
Platforms like Temu promise bargains but have become the cause of concern among European stakeholders, especially with regards to product safety and human rights compliance.
The HDE argues that political intervention is crucial to ensure fair competition from “cheap marketplaces,” while also upholding environmental and consumer protection standards.
Germany’s retail association calls on politicians to ensure “this open barn door for non-marketable products from the Far East is closed as quickly and as widely as possible.”
Fair play and product safety
HDE deputy managing director Stephan Tromp says “mass quantities of goods” coming into the country “violate all regulations.” Lawmakers have been rendered helpless in this process, which directly impacts fair competition and affects consumers.
“For many products, no one checks in individual cases whether they are safe and health-friendly. Electronic devices violate safety regulations on a large scale and textiles often do not comply with the EU chemical limit values,” Tromp says.
The HDE calls for the implementation of new customs procedures at borders. This would require incoming packages to be registered. Tromp says the challenge of managing products from ‘cheap marketplaces’ falls on “retailers, consumer protection, and authorities.”
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Temu goes global
Despite the concerns raised by the HDE, Temu’s popularity continues to soar. The platform’s e-commerce app was the most downloaded iPhone app of 2023. Users also tend to spend more time on the app, beating even Amazon, Walmart, and Target.
Temu’s winning model for engagement is to keep users entertained with games to win rewards. The more time they spend on the app, the more discounts they get.
As part of its strategy to expand in the US, Temu is on a “shopping spree for ad space,” according to the Wall Street Journal. And it’s paying off – the Chinese company is fast becoming one of the most popular shopping apps in the US.
Temu reportedly spent an estimated $1.7 billion in 2023, specifically targeting US audiences. This includes a Super Bowl ad. The company is gunning for $3 billion in 2024.
According to PYMNTS, Temu has a user base of approximately 70 million US shoppers. A draw point is its fast delivery times, taking only one to three weeks to ship a package from China to the US.
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About the author
Cheryl has contributed to various international publications, with a fervor for data and technology. She explores the intersection of emerging tech trends with logistics, focusing on how digital innovations are reshaping industries on a global scale. When she's not dissecting the latest developments in AI-driven innovation and digital solutions, Cheryl can be found gaming, kickboxing, or navigating the novel niches of consumer gadgetry.
