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E-tailer Temu sees strong demand from SA shoppers

Sibahle Malinga
By Sibahle Malinga, ITWeb senior news journalist.
Johannesburg, 04 Jul 2024
Temu is making inroads in South Africa’s e-commerce sector.
Temu is making inroads in South Africa’s e-commerce sector.

Global online retailer Temu has received a positive reception from South African shoppers, with its local business growing significantly since inception, it says.

Temu, which made its local debut in January, has over 400 million app users across the globe, and was the most downloaded app in the first quarter of 2024. In June alone, the app was downloaded over 50 million times globally, making it more popular than Amazon’s marketplace app, according to research firm Statista.

Temu’s business model is based on a multi-segment marketplace, where listed third-party sellers offer a range of product categories, including fashion, household goods, home appliances, toys and electronics.

Owned by the Chinese online retail giant PDD Holdings, the e-commerce platform says it has seen meteoric growth across the 71 markets where it operates, through offering affordable products and employing effective marketing campaigns.

“We have seen strong demand from consumers in SA. Shoppers tell us they welcome the access to quality products at affordable prices,” says a Temu spokesperson.

“Household essentials are some of the most popular products on Temu. However, because we offer general merchandise in over 200 categories, we attract local customers with diverse needs.”

The e-tailer says it cannot disclose any growth numbers.

Over the last few years, new online retailers have entered the market, shaking up the local landscape with low-cost products manufactured in China and free shipping. These include Shein, Wish, Made-in-China and Sunsky, among others.

This has led to local e-tailers and the manufacturing sector expressing concern over the Chinese multinational e-commerce disruptors, with complaints of alleged anti-competitive practices.

The Institute of Chartered Entrepreneurs and SA’s biggest e-tailer Takealot have been among those calling for government’s regulatory intervention, to create a fair playing field that supports the country’s localisation efforts and safeguards the sustainability of local manufacturing industries.

“We are fully committed to complying with the relevant laws and regulations in the markets where we operate, and South Africa is no exception. Our competitive advantage is due to our connection to cost-efficient manufacturers and experience in managing complex supply chains,” Temu tells ITWeb.

According to research firm Stastista, in the first five months of 2023, Temu generated over $1.5 billion in gross merchandise volume, due to the fact that it has caught the eye of inflation-weary shoppers globally.

“Focusing on providing low-cost products with free and fast shipping, Temu has emerged as a wallet-saving alternative amid rising inflation,” it says.

Discussing its strategy in SA, the company says it is still analysing local consumer preferences and will continue expanding its product category and offering free shipment globally.

“At this early stage of our operations in SA, our priority is to understand the preferences of consumers so that we can tailor our service to better meet their needs. At Temu, our mission is to offer consumers access to quality affordable merchandise by connecting them directly to cost-efficient manufacturers and cutting out the middlemen,” says the Temu spokesperson.