Direct-to-consumer brands looking to find customers have an opportunity to take advantage of Temu, China’s fastest-growing discount marketplace.
In February 2024, Temu US Seller Programeffectively opening the platform to American companies. The program gives U.S. brands access to an estimated 185 million domestic and international shoppers each month, and that number continues to grow.
In 2023, Temu became Apple’s most downloaded free application, and in 2024 it dominated the iOS and Android app stores.
Temu US’s homepage focuses on discounted products.
US Seller Program
Temu, like its sister site, pinduoduowhich operates primarily on a contract model.
Manufacturers from China and East Asia fill Temu’s warehouses with goods and create product lists for the market. When sold, the products are shipped directly from the Temu facility in the familiar bright orange bags, using a clever air transport strategy to keep costs low.
The company recently changed its tactics, allowing U.S. sellers to list their products and services. optionally We use Temu’s warehouse and fulfillment system.
The program is free for small sellers, but requires a subscription ranging from 2% to 5% of the sales price for businesses. At the time of writing, the marketplace also charged a payment processing fee of 2.9% + $0.30 per transaction, and sellers paid all shipping costs. When you add up the fees, Temu is similar to other marketplaces.
DTC opportunities
Temu low price While it may not be a good fit for traditional retailers, there may be an opportunity for DTC brands.
a DTC products It’s unique. Temu may have similar products, but they are not identical. Additionally, products made in the United States may have a competitive advantage due to their perceived value and quality.
Overall, I see five potential benefits for DTC brands selling on Temu.
brand building
DTC brands on Temu can introduce their companies to shoppers and build relationships.
This product was introduced after a Temu buyer discovered this brand’s products. The relationship begins with order fulfillment. DTC sellers can include a physical product catalog, a coupon for a free item, or a note on the packaging that explains the brand’s story.
For products that require warranty registration, we will provide you with the opportunity to collect the buyer’s email address and phone number.
revenue
Any established sales channel represents a revenue opportunity. Temu has a huge user base and offers opportunities for discount-minded shoppers.
Temu’s media agency told me that the company does not share estimated or average revenue for sellers. DTC shops need to test, optimize, and iterate on the platform.
marketing
DTC brands that list their products on Temu can participate in platform-wide promotions and flash sales, driving more traffic to their listings and enabling more interactions.
Expansion into China
DTC brands can reverse this scenario and offer products to Chinese buyers through inventory stored in Hong Kong or other Temu locations.
product development
Temu’s lack of listing fees makes it easy to test new items. DTC brands can create short-term prototype products and offer them on Temu to learn what will appeal to shoppers.
Marketplace in general
For sale at Temu, General marketplace strategies For DTC brands.
Brands selling on one marketplace can also consider other marketplaces. So listings on Amazon, Temu, Walmart, Esty, and eBay can all be part of an overall marketplace approach that includes:
- Set marketplace-specific goals. revenue goals, customer acquisition rates, or brand awareness Metrics for each marketplace.
- Establish your marketplace audience. Use analytics to learn customer demographics and purchasing behavior by market. Temu shoppers are probably different than Amazon or Walmart shoppers.
- Tailor your product to the market. A brand may have multiple versions of similar items. You’ll probably find the best quality products on Amazon, and entry-level products on Temu. Returns and seconds may be sold on eBay.
- Optimize your product list. Optimization tactics common to all marketplaces include high-quality images, rich keyword descriptions, and competitive pricing. However, please be aware of platform-specific conventions, conventions, and rules.
