Temu over the weekend quietly made its “grand opening” in the Philippines, where the Boston-based sibling of Chinese online retailer Pinduoduo offered up to 90 per cent off items such as T-shirts, double-sided tape, and kitchen storage and appliances, according to its website.
The generous discounts form part of a tried-and-tested playbook that has helped Temu climb to the top of Apple’s App Store and Google Play’s free-app rankings when the online marketplace launched in the United States last year.
Temu’s budget shopping app is seen on a smartphone screen with the icons of other popular online platforms including Shein, Walmart, eBay, Amazon, Target, Etsy, AliExpress and Lazada. Photo: Shutterstock
In June, Temu sent out a survey to online merchants asking which platforms they were already using in Japan, South Korea and Southeast Asia.
Temu, which is now available in more than 38 countries, did not immediately reply to a request for comment on Monday.
Southeast Asia’s e-commerce market, which comprises 11 economies at different stages of development, is projected to reach around US$230 billion in gross merchandise volume by 2026, according to an article published last December by global management consulting firm McKinsey & Co.
Indonesia and Singapore lead the region with an e-commerce penetration rate of about 30 per cent, the McKinsey article said. The Philippines, Thailand and Vietnam trail the market with an e-commerce penetration rate of about 15 per cent.
Lazada, for example, recorded double-digit order growth year on year in Southeast Asia during the quarter ended June 30 on the back of improved monetisation and operating efficiency, according to Alibaba’s earnings report for the period. Alibaba owns the South China Morning Post.
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That prompted Alibaba last month to inject US$845 million in fresh capital into Lazada, which received its first investment from the e-commerce giant in 2016 when the Hangzhou-based group took a controlling stake in the firm. Alibaba made subsequent investments that increased its stake in Lazada to more than 80 per cent.
Temu owner PDD reported a 58 per cent year-on-year increase in first-quarter revenue to 37.6 billion yuan (US$5.2 billion), despite macroeconomic headwinds and slowing retail sales across the country. Nasdaq-listed PDD will report its second-quarter financial results on Tuesday.
