A new Chinese app, known as Temu, encourages people to “shop like a billionaire” has surpassed Amazon to become Australia’s most popular free shopping app.
Chinese-owned app launched last year and sells everyday items like clothes and toys at a heavily discounted price. The total value of products sold went from US$3 million in September last year, to US$400 million in April, according to Statista.
In July 2023, the app recorded nearly 30 million app downloads worldwide.
At the time of writing, Temu is the most downloaded free app in Australia, beating myGov, Maccas, Youtube and Google.
Colourful orange ads and an influencer marketing strategy have proved effective for the brand which has skyrocketed in popularity in just over a year.
Temu adopts intense marketing strategy
In the first month after its launch, Temu spent US$200 million on advertising expenses, and that investment paid off: within two months, it surpassed the popular Chinese webshop Shein in the shopping app charts.
They also adopted gamified features in the style of their sister company Pinduoduo. Australian researchers have pointed out that gamified advertising on the app, where a spinning wheel provides the possibility of major discounts, creates the illusion of getting lucky and is intended to generate positive emotions in customers.
However the company is under scrutiny. In June a US congressional committee warned that there was an “extremely high risk” that products sold on the app have been made with forced labour.
According to documents Temu provided to the committee, the company has more than 80,000 suppliers that fuel its vast e-commerce platform.
Chinese fast fashion giant and major competitor Shein is trying to take Temu to court, alleging that Temu has been paying influencers to spread “false and deceptive statements” about Shein on social media. Temu has denied these accusations.