Temu's path to U.S. expansion
In September 2022, Temu, a cross-border e-commerce platform owned by Chinese e-commerce giant Pinduoduo, officially entered the U.S. market. As the international version of Pinduoduo, Temu continues its successful experience in the domestic market, and quickly attracts the attention of a large number of American consumers with its ultra-low price and free shipping strategy. The prices of goods on Temu are often more than 50% lower than those of other e-commerce platforms, and most items come with free shipping. This "ultimate cost-effective" model is in stark contrast to traditional American e-commerce that pursues high quality and high service. In just three months after its launch, Temu's app has exceeded 10 million downloads, making it the fastest-growing e-commerce app in the United States, and continues to maintain the momentum of being on par with giants such as Amazon, eBay, and Walmart.
Temu's emergence in the U.S. market is not only due to Pinduoduo's mature business model, but also inseparable from the strong supply chain resources behind it. Relying on Pinduoduo's vast network of merchants and factories in China, Temu is able to obtain goods at a lower cost, coupled with its own logistics system, to provide ultra-low-cost goods on the platform. Temu has also localized and adjusted its products according to the preferences of American consumers, and has launched a large number of popular products that meet the aesthetics and needs of Americans. Hundreds of millions of U.S. consumers are attracted by Temu's "high cost performance" and have tried shopping on the platform, and Temu's market share continues to climb.
The reaction of e-commerce and politics in the United States
The rapid rise of Temu in the United States has made American e-commerce giants such as Amazon and eBay feel unprecedented pressure. These giants have always dominated the U.S. e-commerce market and are accustomed to operating models with high gross margins and high pricing. The emergence of Temu broke this pattern and began to eat into their market share with its "extreme value for money". According to statistics, Temu's share of the U.S. e-commerce market will exceed 10% in 2023, and the gap with Amazon is narrowing. Giants such as Amazon have begun to respond to Temu's impact by cutting prices and increasing promotions, but they have no advantage over Temu in terms of supply chain costs and platform operation efficiency, and it is difficult to be effective.
At the same time, some American politicians are also uneasy about the rise of Temu. They fear that Chinese companies like Temu will use low-price dumping to defeat American companies, thereby controlling the American market and even threatening America's economic security. Some lawmakers began to demand an investigation into Temu on the grounds of "national security", claiming that Temu may have data security risks, intellectual property infringement and other issues. There are also politicians who have proposed to add Temu to the "Entity List" of the United States in order to restrict its business development in the United States. These practices are similar to the previous US crackdown on TikTok, highlighting the fact that some US politicians are accustomed to politicizing their resistance and suppression in the face of competition from Chinese companies.
The epitome of business competition between China and the United States
The chain reaction triggered by Temu in the United States has become a microcosm of the increasingly fierce business competition between China and the United States in recent years. As the world's two largest economies, China and the United States have gone head-to-head in many areas. On the one hand, Chinese enterprises represented by Temu are accelerating their "going global" with their own innovation and competitiveness, and showing strong vitality in overseas markets. On the other hand, some politicians and companies in the United States are uneasy about the rise of Chinese companies and are trying to contain it with politicized means.
The actions of some US politicians towards Temu have once again exposed their "double standards": when US companies are working hard in overseas markets, they advocate free competition and open markets, while when Chinese companies emerge in the US market, they use the so-called "national security" as an excuse to set up obstacles and treat Chinese companies differently. In essence, this practice is a political interference in normal business practices, violates the market principle of free and fair competition, and hinders the deepening of international business exchanges in the process of globalization. As can be seen from Temu's case, in the face of competition from Chinese companies, some politicians and companies in the United States are losing their rationality and self-confidence, and resorting to despicable tricks that distort the facts and smear their opponents.
From a broader perspective, Temu's development in the United States also confirms the general trend of globalization and the inevitable trend of accelerating the internationalization of Chinese enterprises. With the continuous growth of China's economy and the continuous accumulation of enterprise strength, more and more Chinese brands have begun to deploy overseas and show their style in the global market. In the past few years, a number of Chinese technology giants such as ByteDance, Huawei, and China Mobile have stepped up their efforts to go overseas, and have achieved remarkable results in Southeast Asia, Europe, Latin America and other regions. The rise of Temu marks that China's traditional industries and small and medium-sized enterprises have also joined the ranks of the overseas army. These companies interpret Chinese wisdom in their own way, respond to the needs of the world with high-quality products and services, and promote the evolution of the global business landscape.
Looking at the historical juncture, the Temu phenomenon heralds the arrival of a new era. In this era, business competition is becoming increasingly fierce, and the game between the two super economies of China and the United States is more frequent and direct. For Chinese enterprises, in order to gain a foothold on the international stage, they must carry forward the "Temu Spirit" and face challenges and embrace the world with perseverance, courage to innovate and a sincere and trustworthy attitude. As far as the U.S. society is concerned, it should abandon prejudice and stereotypes, view the development of Chinese enterprises with an open and inclusive attitude, and carry out cooperation on the basis of equality and mutual benefit to jointly promote global economic prosperity.