Last month, Amazon launched Haul, a low-cost marketplace competitor to China-based Temu and Shein.
Tem and Shane operate in the U.S. by shipping extremely low-cost products directly from China. Reuters reported In December 2023, it was announced that Temu had captured 17% of the US market among discount retailers including Dollar Tree, Dollar General, and Five Below.
Temu and Shein are the #1 and #2 most downloaded shopping apps in the Apple App Store. According to Yahoo Finance In April 2024.
amazon howl
Amazon essentially needed a lower-cost option to thwart this rapidly growing Chinese competition for the dollar store market.
At the time of this writing, Haul was available Only within the Amazon appand the listing was separate from the general Amazon marketplace.
Haul items cost less than $20, many are less than $10, and some are even $1. Free shipping on orders of $25, otherwise $3.99.
Haul offers 100-yen store products to Amazon through its app. Click on the image to enlarge.
Seller influence
According to information, Amazon sellers have been cautiously anticipating Haul for several months.
Perhaps Amazon believes Haul will attract shoppers, and that seems to be the case. On Black Friday 2024, Amazon took 50% off all Haul products to drum up interest. Marketplace Pulse reported Many of Haul’s approximately 3,000 participating sellers sold out of key items during the promotion.
“If you’re a seller of low-priced products, Haul is just one way to make it easier for price-conscious consumers to find your products,” says Managed Services Global. Director Katie Moro said. Product introductionemail to e-commerce product content providers.
“Shoppers don’t need to set filters to narrow their search to products in your price range. They can freely scroll through the Haul storefront in the Amazon app and see if products meet their budget requirements. I understand,” Moro continued. “Haul thus brings great benefits to the business as it helps us compete with Temu and Shein sellers.”
Therefore, Haul could boost the market.
It may also impact customer acquisition strategies, private labels, and arbitrage sellers.
customer acquisition
Some brands may use Haul to promote loss leaders. acquire customers. Loss leader strategies are similar to advertising. Brands buy advertising or sell products below cost to generate sales.
“This is a similar strategy to Lululemon’s much-talked-about belt bag. Compared to regular prices for sportswear, Lululemon made the bag significantly cheaper,” Moro wrote.
“Lululemon is able to build customer loyalty by attracting first-time buyers to its brand and letting them know the quality of its products. It starts with the purchase of a small belt bag, evolves to leggings, and so on. Similarly, we can leverage Haul’s high profile to expand our audience reach with a few low-priced items and continue to build customer relationships with the rest of our product catalog in our regular Amazon storefront.” says Moro.
private label competitors
Many private label sellers on Amazon source their products from China. Nothing can stop Chinese manufacturers from attacking direct sales on Haul — Common method for Temu and Shein items.
Private label sales could take a hit if Haul products start appearing on Amazon’s regular marketplace.
arbitrage competitors
Depends on e-commerce dropshippers AliExpress style arbitrage It may also face competition from Howl.
These sellers typically use Dsers or similar apps to identify products on the AliExpress marketplace and resell them for a profit via Shopify or the marketplace.
This type of retail arbitrage works because relatively few consumers know about AliExpress or how to access it. Amazon Haul brings direct retail from China to the mainstream. All AliExpress sellers may eventually be shipped.
cheap ecommerce
Time will tell whether any of these scenarios play out, but many other factors could play a role Direct retail from China -new us tariffsfor example.
What we do know is that very cheap, inexpensive e-commerce products are popular.
