Insight Flash: Leverage CE data to understand how Temu growth could affect different brands and industries
“The Amazon killer.” “The challenger of dollar store dominance.” “The future of buying things.” Temu, the fast-growing Chinese e-commerce company that has dominated app charts since its U.S. launch in 2022, has been declared to be many things. Leveraging CE’s U.S. transaction data, we can examine shopper behavior to see which brands might be most impacted by Temu’s rise. These takeaways can help both public and private investors to uncover potential risks of Temu growth to brands across the retail landscape.
Cross-Shopping: Percentage of Selected Brands’ Shoppers Also Shopping at TEMU
Focusing on brands with the highest percentage of their shoppers making a purchase at Temu, CE data shows that Temu’s key competitors Aliexpress and Shein are at the top of the list, along with Tiktok’s recently launched TikTok shops, as more than 15% of their brand’s shoppers also made a purchase at Temu in the 91 days ended 9/24/23. The data also highlights the potential pressures faced by dollar stores (e.g. Five Below, 99 Cents Only) and discount retailers (e.g. Burlington, Ollie’s) as they compete with a player that is both undercutting prices and offering a gamified shopping experience.
While Temu growth threats to those types of companies have been broadly discussed, CE data reveals high customer overlap with other industries as well, including children’s apparel (e.g. The Children’s Place, Once Upon A Child), beauty products (e.g. Ipsy, Sally Beauty), and books (e.g. Thrift Books, Scholastic Book Club).
Cross-Shopping: Change in Percentage of Brands’ Customers Shopping at TEMU
Comparing cross-shop to previous periods, the data can uncover where customer overlap with Temu has increased, potentially indicating a rising threat. CE data shows that apparel and footwear companies such as The Children’s Place and Finish Line, home furnisher Bed Bath & Beyond, and online retailer Groupon.com are all near the top of the list with a >3% increase in their shoppers purchasing something at Temu in the 91 days ending 9/24/23 compared to 6/25/23. These shifts showcase just how far-reaching Temu’s disruption is, as the ubiquity of its offering impacts many different industries.
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