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You might have never heard of Temu, but it’s definitely on Amazon’s radar.
That’s because the online Chinese retail brand is nipping at Amazon’s heels, according to app engagement and consumer sentiment survey data from GWS Magnify that found Temu has become the Everything Store’s main competitor in the US.
Temu’s growth in 2023 has surpassed or nearly surpassed retail heavyweights including eBay, Walmart, and Target. GWS Magnify estimates Temu had 82.4 million active shoppers using its app in September, up from 4.6 million just a year ago.
- For context, eBay had just over 40 million shoppers using its app last September, a figure that fell to just over 37 million last month.
- Target’s monthly active users have hovered around 25 million throughout the year.
- Walmart had 85.5 million active users in September, slightly more than Temu.
“Temu’s rate of growth has been so impressive that GWS Magnify predicts the company will overtake Walmart with more active users and become the second-largest online retailer in the US in terms of consumer engagement,” the company said in a statement.
For now, Amazon still remains top dog when it comes to user activity with 142 million monthly users in September, but that number has dropped from 149 million on a year over year basis.
Temu’s not-so-secret secret sauce is its low prices that appear to be resonating with shoppers. When asked how the company made them feel, a majority (65%) said its low prices stood out. And it appears that consumers are willing to sacrifice the customer experience in favor of less expensive products.
- Less than a third (30%) of shoppers said they approved of Temu’s delivery speeds, compared to 52% who said the same of Amazon.
- Less than a fifth (19%) said they approve of the refund process, as opposed to roughly a third (32%) for Amazon.