Temu, the well-known e-commerce platform of Asian origin, is experiencing a period of significant turbulence in its key market, the United States. The company, along with Shein, has been one of the main targets of the latest trade decisions adopted by the US administration, especially in the wake of the recently imposed tariffs and additional taxes. After months of meteoric growthBoth Temu and Shein are experiencing significant declines in sales volume and monthly active users.
One of the main reasons for this decline has been the imposition of new tariffs by President Donald Trump. These tariffs have caused Temu's monthly user base to has been reduced by more than half between March and June, currently reaching 41,4 million usersFor its part, Shein has also recorded a decline, albeit more moderate, with a loss of 12% of its users in the same period.
The impact of advertising cuts and American consumption
In addition to tariffs, Companies have opted for a drastic reduction in investment in digital advertisingIn the last three months, Temu cut its advertising budget by a staggering 87%, while Shein did so by 69%. As a result, both companies disappeared from the Top 60 largest digital advertisers in the US., when the previous year they were among the top fifteen positions.
This change in advertising strategy and the new situation have caused both Temu and Shein to lose prominence in one of their key markets, which has resulted in lower visibility and a notable drop in demand and interest in their products.
Europe: a refuge and a new stage for Temu
Given this situation, Fast fashion and budget product platforms have focused their efforts on EuropeThere, the reception has been much more positive: between March and June, Temu managed to increase its users by 76% in France, 71% in Spain, and 64% in Germany, according to industry data. These growths show how the firm has been able to adapt and find new market niches on the continent..
The change in trend in Europe is not a coincidence: lower tariff pressure and still strong demand for this type of platform have helped Temu and Shein grow rapidlyHowever, the outlook could change soon.
France leads the way: regulation and new challenges
The French Senate has just approved legislation aimed at regulate large foreign ultra-fast fashion operators, like Temu and Shein. The main objective of this law is to protect local firms and balance competition in the French national market. This new regulation proposes greater controls and obligations for these platforms, which could make it difficult to operate freely and maintain the pace of growth in the medium term.
The situation reflects The complex relationship between the accelerated growth of Chinese platforms and the Western regulatory responseWhile Temu has managed to adapt quickly and seek out new profitable markets when the US environment has become hostile, European governments are beginning to debate how to control and balance the impact of these e-commerce giants on the local economy..
Although The future of Temu and its international demand will depend largely on the evolution of regulations in both the United States and Europe, its ability to reinvent itself and maintaining consumer confidence in the face of global political and economic changes will be key.
