Disrupting E-Commerce: How Shein and Temu are Challenging Amazon's Reign with Jing Yang
Jing Yang, the Asia Bureau Chief from The Information shares the showdown between Amazon, Shein and Temu in the E-Commerce landscape.
Fresh out of the studio, Jing Yang, the Asia Bureau Chief from The Information shares the ongoing e-commerce war between Amazon and the upstarts: Shein and Temu across the global landscape. Starting from the origins of Shein and Temu, she explained how both companies first expanded to the US enabled by Amazon. Jing Yang breaks down how Temu gains total control over its suppliers and sellers and subsequently threatens Amazon's e-commerce dominance in the US market. Last but not least, she examined the fallout from the potential US ban on Shein and Temu from US lawmakers and the possibility of Shein's IPO in the US.
"Temu was launched in the US, their first market in September 2022. That is when Shein just started to gain a lot of traction. There's a lot of attention being paid to Shein. In the beginning, many people thought that Temu was a copycat of Shein because they both sold goods from China using this direct-from-China shipping model. However, I think the competition has evolved quite differently now, and Temu has done business and operational innovation that has made others, including Shein, have to catch up." - Jing Yang
Introduction
- Jing Yang, Asia Bureau Chief from TheInformation (LinkedIn, @jingyanghk, )
- Since our last conversation, what have you been up to?
- As I was in Hong Kong, to my surprise, I could not access Open AI’s ChatGPT. Thank you for enlightening me that the Chinese government did not ban ChatGPT. So why is ChatGPT from Open AI not accessible in Hong Kong?
The Global E-Commerce War 2024 - Temu and Shein vs Amazon
- Let’s start with an introduction to two companies which originated in China but have successfully expanded globally: Shein and Temu. Shein is now incorporated in Singapore, while the Chinese company, Pinduoduo, wholly owns Temu and is listed on NASDAQ. Can you provide an overview of the origins of Shein and Temu, and how they have evolved since their inception?
- Who are the key people behind Temu and Shein?
- What are the performances of Shein and Temu in the year 2023 and how are they compared to their European fast-fashioned rivals?
- Let’s go with Shein, they partnered with their rival, Forever 21 in August 2023, what is the essence behind their partnership?
- Can you explain how Temu maintains such tight control over its suppliers? What specific practices do they use to manage and monitor their supply chain?
- How do Temu's supplier management practices compare to those of other major e-commerce platforms like Amazon and Shein?
- How did Amazon enable the expansion of Shein and Temu into the US market?
- What was Amazon's initial reaction when Doug Herrington highlighted Temu as a significant competitor?
- How has Temu’s entry into the market influenced Amazon’s business strategies, and what responses has Amazon made to blunt the risk of Temu and Shein siphoning away shoppers with cheap goods?
- Recently, in your latest article, what prompted Temu to change its strategy from direct from China to a different approach to handle Amazon’s entry into their business?
- What implications does Temu’s strategic shift have for the broader e-commerce landscape?
- How reliant is Amazon from the Chinese sellers and what are the implications in the long term?
- There have been discussions about a potential U.S. ban on Temu imports due to concerns over forced labour. What are the key factors driving this potential ban?
- How significant is the risk of this ban for Temu, and what impact could it have on their operations if implemented?
- How will Temu reduce its reliance on US shoppers?
- How is the US government escalating the crackdown on the trade rule behind Shein and Temu and what are the responses from both companies to the US government?
- Can Shein eventually IPO and still have access to the US market?
- Similarly, what are the likely scenarios for Temu given the US might limit its access?
Closing
- Any recommendations that have recently inspired you?
- Jing Yang's recommendations: High Wire: How China Regulates Big Tech and Governs Its Economy by Angela Huyue Zhang, Dopamine Nation: Finding Balance in the Age of Indulgence by Anna Lembke and Netflix's 3 Body Problem
- Where can my audience find you?
References from The Information (Requires subscription):
- Shein’s 40% Revenue Growth and Profit Boost in 2023 Could Help Lure IPO Investors.
- Temu Keeps An Iron Grip on Suppliers, Exposing Itself to U.S. Ban Threat
- U.S. Escalates Crackdown on Trade Rule Behind Shein and Temu
- Shein to Prioritize Compliance Amid U.S. Forced Labor Crackdown
- Temu Aims to Lessen Reliance on U.S. Shoppers
- Temu Flip-Flopped on Cotton Policy Meant to Weed Out Forced Labor, Suppliers Say
- U.S. Lawmakers Demand Temu Shipment Ban Over Forced Labor Concerns
- Inside Amazon, Temu’s Rise Prompts Soul Searching
- How Shein Decided to Partner With Rival Forever 21
- Temu Breaks With Direct-From-China Strategy In Threat to Amazon
- Amazon To Launch Temu-Like Discount Section With Direct Shipping From China
- Amazon’s Bargain Store Would Use Same Trade ‘Loophole’ as Temu, Shein
- Temu Opens Up Marketplace to European Merchants
Podcast Information: Bernard Leong (@bernardleong, Linkedin) hosts and produces the show. Proper credits for the intro and end music: "Energetic Sports Drive" and the episode is mixed & edited in both video and audio format by G. Thomas Craig (@gthomascraig, LinkedIn).
