Compulsory seller price reduction? Temu starts competitive bidding mode for the same product!
Temu initiates competitive bidding for a product due to a compulsory reduction in seller price
According to the latest global e-commerce shopping index statistics released by Salesforce, BusinessDialogue learned that in the first quarter of 2023, global e-commerce traffic increased by 6% year-on-year, achieving continuous growth for five consecutive quarters. However, online order volume has been declining for five consecutive quarters, with the average number of products per order decreasing by 6% and the average order value also decreasing.
This means that although global e-commerce traffic is increasing, the profit brought in by each visit to an e-commerce website by customers is decreasing. After reading this report data, many sellers pointed out that this is a major sign that all global e-commerce platforms are moving towards low-price competition. Among them, Temu, known as the “king of low-price competition,” has made a significant contribution. Temu’s traffic continues to soar, and it continues to open up new sites BusinessDialogue learned that according to Comscore’s data, as of February 2023, Temu, the cross-border e-commerce platform of Pinduoduo, has attracted 70.7 million independent visitors to its website and application in the United States, surpassing many mainstream e-commerce platforms in the United States, as well as SHEIN in the same category.
▲ Image source: Comscore This data was shared by a seller and has caused a lot of discussion in the BusinessDialogue seller exchange group: “Temu actually has 70 million visitors, my goodness, no wonder Amazon’s traffic has decreased.” “It’s almost twice as much as SHEIN, is this true?” “I want to do Temu too…” BusinessDialogue learned that since its launch last year, Temu has been using low-price subsidies and viral social media marketing to increase traffic. In February of this year, with the support of the traffic from the “American Spring Festival” Super Bowl, its downloads increased by 45%. Since then, Temu, which has achieved explosive growth in the North American market, has begun its global expansion. So far, TEMU has opened sites in 12 countries, including the United States, Canada, Australia, New Zealand, the United Kingdom, Germany, the Netherlands, Italy, France and Spain. On May 18th, according to seller revelations, TEMU once again opened two new national sites, Austria and Mexico. From the Temu seller background, the Austrian and Mexican sites are already on the list of sites. The continuous high traffic of Temu and its tireless expansion have made many sellers unable to resist the temptation to lay out this new platform. Among them, there are many supply-type sellers who have earned a lot of money through “small profits and quick turnover”, but more sellers are still suffering from Temu’s ultra-low price strategy. Judging from the new strategy that was recently exposed, Temu is still walking on the path of “low price” without looking back. Temu launches a bidding mode to further reduce product prices
BusinessDialogue learned that recently, many Temu sellers received a notice about the product bidding rules. The notice stated that sellers who received it had products that had joined the bidding process and needed to confirm and send samples as soon as possible. Failure to operate within the time limit may result in the product being taken down or the replenishment being suspended. The specific bidding rules are as follows: 1. The same products will be bid on once a week, the lower price wins (Monday 9:00 a.m. – Thursday 11:59 p.m.); 2. After the system automatically initiates the bidding, the seller needs to confirm the invitation in a timely manner. Failure to confirm in time will result in the bidding failure; 3. Products that fail to bid will be restricted from listing and stocking, while successful bid products will not be restricted.
- Shein and Temu dominate the top 50 countries’ shopping app download rankings worldwide
- Temu opens two more country sites; SF Express’s international business revenue in April reached 47 billion yuan
- Temu has launched a fiercest bidding policy! Those who do not participate in the bidding may have their products removed
▲ Image source from seller exposure Key points: The same products will be bid on once a week, and failure to participate in or win the bidding will result in restricted new product listings. After this notice was issued, many sellers were furious: “Temu is taking advantage of the sellers, and we may be taken down if we don’t participate in the bidding?” “Wasn’t there already a comparison strategy between different platforms before? Now the same platform and the same product also need to participate in the bidding?” “Continuing like this will eventually lead to the elimination of good products by bad ones.” BusinessDialogue understands that since its launch, Temu’s traffic distribution logic has always been based on “low prices.” Some sellers have found that Temu not only tilts traffic towards lower-priced products, but also takes a series of measures to reduce product prices.
For example, before this, many sellers complained that Temu not only required product pricing to be lower than the 1688 wholesale price, but also directly took down the products of sellers when it found similar products with lower prices on the same or other platforms. ▲ Image source from seller exposure It is enough to show that in Temu’s path to sinking into the market with extreme low prices, platform sellers are still struggling with “slashing profits.” In addition, since its launch, Temu has been criticized by sellers for its chaotic management, strict fines, and low process efficiency. Currently, Temu, which is well-versed in marketing, has indeed achieved great success in increasing platform traffic and user numbers, but its operation system and management system urgently need improvement. Therefore, even though Temu’s development momentum is rapid, whether it can stand in the forefront of the overseas consumer market and not fail still needs to be verified over time.
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