Traffic from multiple head links dropped significantly, and Temu sellers saw a 40% decrease in orders

According to sellers’ feedback, Temu’s traffic has started to decline recently. The sales of top sellers in multiple categories have generally dropped by more than 30% while the rankings have not changed. This phenomenon has gradually become prominent since Temu’s warehouse explosion in May and has continued to this day.

As traffic declined, the traffic of many links also fluctuated and could not stabilize, which made sellers wonder: "Why did the price drop, but the traffic and orders disappeared? I don't understand what's going on now."

Temu sellers' orders dropped by 40%, and traffic on multiple links fluctuated

"Temu's traffic has declined significantly recently. The orders for several of my popular products have dropped by about 40% . It's not just my own links. According to my recent observations, the traffic and orders of the links at the top of multiple categories have declined, with a decline of about 30%-50% . " Seller Alex told Yienjun.

Alex was one of the first sellers to join Temu. He started out as an Amazon seller, but because of his supply chain advantages, he joined Temu without hesitation when the platform was first promoted. Thanks to his early experience, his business on Temu went quite smoothly, with multiple links reaching the top of the category.

Recently, Alex found that product links in categories such as home furnishing, gardening, and 3C were abnormal . The traffic of many top-selling products dropped sharply, while some lower-ranked products were not affected much. According to his feedback, he talked with his peers about this phenomenon, and several sellers had similar feelings. Everyone agreed that Temu may have passed the period of rapid development, and now the traffic of the entire market is declining sharply.

Similar to Alex, seller Li Gangqiang also felt that the recent order decline was quite obvious. Although his product did not reach the top, with the same ranking, his order volume was obviously lower than that in February and March.

Not only has the traffic declined, but according to Alex and Li Gangqiang, the traffic of many links on Temu has been very unstable recently, fluctuating up and down. Li Gangqiang bluntly said that he didn't know how to prepare the stock.

Alex introduced that Temu is different from Amazon. Its traffic distribution is confusing and sellers have no way of knowing the logic. When the platform promotes your product, it will divert traffic to advertising, and the link will take off immediately. On the contrary, if the platform does not promote it, your link traffic will suddenly disappear and the product will immediately become unsalable.

In his opinion, e-commerce should follow horse racing logic and determine product rankings based on platform conversion rates, sales, reviews and other weights, or let sellers know certain standards like Amazon does, rather than relying entirely on the platform's promotion decisions.

Selling prices to sellers increases platform profit margins

It is understood that the decline in traffic felt by sellers began at the end of May. Alex analyzed that this time point corresponds to the actual situation of the platform's warehouse explosion. He believes that the specific reasons are as follows:

1. The growth of new users on the platform has slowed down. When Temu was first launched, it offered a super low price strategy to attract new users. Many links were sold at $0.1 or $0.99. Because of the price advantage, many new users came to the platform to take advantage of the bargains. After launching in September last year, Temu became the most popular Android shopping app in the US market in just two weeks. On September 17, Temu's downloads ranked first in the Google Play Store rankings, successfully surpassing Amazon and Walmart.

This year, the ultra-low price of $0.1 during Temu’s promotion period has disappeared. Perhaps the platform also needs to recover funds, and the number of new users will decrease to a certain extent.

2. After the warehouse explosion problem, the platform’s promotion efforts were not so strong. In May , Temu’s warehouse was overwhelmed, and many sellers squatted in the early morning to grab positions. Until recently, the problem of grabbing positions has continued. This may be related to the platform’s expansion of multiple sites in a short period of time. After the warehouse explosion, the platform will correspondingly reduce the advertising of some products.

On Temu, many top-selling products require external traffic. If the platform stops advertising, the traffic of the top-selling products will drop significantly, while products with medium and low sales mostly rely on natural traffic, so the top links are the most affected this time.

3. The purchasing demand in the United States has decreased, and the overall market traffic has declined. In fact, it is not only Temu sellers, but many Amazon sellers have also felt the decline in orders and traffic this year. The final factor may be related to the demand of the terminal.

According to the latest monthly global port tracking report released by the National Retail Federation ( NRF) and Hackett Associates, import cargo volumes at major U.S. container ports in the first half of 2023 will fall 22% from the same period last year, and U.S. imports will fall back to pre-pandemic levels.

Li Gangqiang believes that in addition to the above factors, it may not be because Temu's traffic has decreased, but because the number of sellers on the platform has increased . With the explosion of traffic, many new sellers have flooded into the platform, and the competition has become more intense. Everyone is sharing the traffic. Under this circumstance, Temu also has the confidence to further lower prices, anyway, there will always be new "leeks" entering the market.

Alex said that the price cuts by the platform over and over again are not reflected on the consumer side. The pricing at the front end will not change. For example, if a product is sold at $10, this price is already lower than other platforms such as Amazon. It is meaningless to reduce the price at the front end. The final profit after the price cut goes to the platform . For example, Temu initially added 10 points to the seller's supply price. After layers of price cuts, the platform's profit may increase to 30 points.

The price dropped, the traffic disappeared, and the sellers don’t understand the game anymore.

Whether it is the platform’s price pressure or unstable traffic, the decline in orders makes it difficult for sellers to adapt to the platform’s rhythm.

Alex told Yienjun that the most frustrating thing for Temu sellers is that they have no idea about the platform’s positioning, and don’t know whether they specifically want factories or traders with supply chain advantages.

First of all, the supplier role that Temu wants is actually a factory. Now the traffic of many links is unstable. Buyers negotiate prices and require sellers to stock up in large quantities. But the problem is that if your product is promoted, the traffic of the link will increase rapidly. Once the advertising department of the platform stops promoting it, the seller’s link will be like "dead" and can only be cleared. Factories cannot adapt to this risk at all.

Secondly, if the link is only stable for a period of time, then this method is more suitable for traders, because traders can quickly adapt to the logic and rhythm of this supply, but there are also certain risks, because once the traffic takes off, the platform will carry out rounds of price reduction until there is no profit margin, then where does the price difference for traders come from?

Finally, whether it is a factory or a trader, sellers may encounter a problem: the price has dropped and the traffic has disappeared, because a price reduction does not necessarily mean that your products will continue to sell well, because the platform does not implement a relatively transparent horse racing logic.

Fundamentally, Alex believes that Temu is a new platform that is in a period of rapid growth and there may not be a perfect mechanism at present. Only when the platform has a clear goal can sellers move forward better.

Alex disagrees with the complaints from many of his peers that Temu will only reap a wave of traffic in the short term and will not adhere to long-termism. He thinks that Pinduoduo is a big company after all, and its ambitions go beyond just making quick money.

Traffic from multiple head links dropped significantly, and Temu sellers’ orders decreased by 40%

According to sellers’ feedback, Temu’s traffic has started to decline recently. The sales of top sellers in multiple categories have generally dropped by more than 30% while the rankings have not changed. This phenomenon has gradually become prominent since Temu’s warehouse explosion in May and has continued to this day.

As traffic declined, the traffic of many links also fluctuated and could not stabilize, which made sellers wonder: "Why did the price drop, but the traffic and orders disappeared? I don't understand what's going on now."

Temu sellers' orders dropped by 40%, and traffic on multiple links fluctuated

"Temu's traffic has declined significantly recently. The orders for several of my popular products have dropped by about 40% . It's not just my own links. According to my recent observations, the traffic and orders of the links at the top of multiple categories have declined, with a decline of about 30%-50% . " Seller Alex told Yienjun.

Alex was one of the first sellers to join Temu. He started out as an Amazon seller, but because of his supply chain advantages, he joined Temu without hesitation when the platform was first promoted. Thanks to his early experience, his business on Temu went quite smoothly, with multiple links reaching the top of the category.

Recently, Alex found that product links in categories such as home furnishing, gardening, and 3C were abnormal . The traffic of many top-selling products dropped sharply, while some lower-ranked products were not affected much. According to his feedback, he talked with his peers about this phenomenon, and several sellers had similar feelings. Everyone agreed that Temu may have passed the period of rapid development, and now the traffic of the entire market is declining sharply.

Similar to Alex, seller Li Gangqiang also felt that the recent order decline was quite obvious. Although his product did not reach the top, with the same ranking, his order volume was obviously lower than that in February and March.

Not only has the traffic declined, but according to Alex and Li Gangqiang, the traffic of many links on Temu has been very unstable recently, fluctuating up and down. Li Gangqiang bluntly said that he didn't know how to prepare the stock.

Alex introduced that Temu is different from Amazon. Its traffic distribution is confusing and sellers have no way of knowing the logic. When the platform promotes your product, it will divert traffic to advertising, and the link will take off immediately. On the contrary, if the platform does not promote it, your link traffic will suddenly disappear and the product will immediately become unsalable.

In his opinion, e-commerce should follow horse racing logic and determine product rankings based on platform conversion rates, sales, reviews and other weights, or let sellers know certain standards like Amazon does, rather than relying entirely on the platform's promotion decisions.

Selling prices to sellers increases platform profit margins

It is understood that the decline in traffic felt by sellers began at the end of May. Alex analyzed that this time point corresponds to the actual situation of the platform's warehouse explosion. He believes that the specific reasons are as follows:

1. The growth of new users on the platform has slowed down. When Temu was first launched, it offered a super low price strategy to attract new users. Many links were sold at $0.1 or $0.99. Because of the price advantage, many new users came to the platform to take advantage of the bargains. After launching in September last year, Temu became the most popular Android shopping app in the US market in just two weeks. On September 17, Temu's downloads ranked first in the Google Play Store rankings, successfully surpassing Amazon and Walmart.

This year, the ultra-low price of $0.1 during Temu’s promotion period has disappeared. Perhaps the platform also needs to recover funds, and the number of new users will decrease to a certain extent.

2. After the warehouse explosion problem, the platform’s promotion efforts were not so strong. In May , Temu’s warehouse was overwhelmed, and many sellers squatted in the early morning to grab positions. Until recently, the problem of grabbing positions has continued. This may be related to the platform’s expansion of multiple sites in a short period of time. After the warehouse explosion, the platform will correspondingly reduce the advertising of some products.

On Temu, many top-selling products require external traffic. If the platform stops advertising, the traffic of the top-selling products will drop significantly, while products with medium and low sales mostly rely on natural traffic, so the top links are the most affected this time.

3. The purchasing demand in the United States has decreased, and the overall market traffic has declined. In fact, it is not only Temu sellers, but many Amazon sellers have also felt the decline in orders and traffic this year. The final factor may be related to the demand of the terminal.

According to the latest monthly global port tracking report released by the National Retail Federation ( NRF) and Hackett Associates, import cargo volumes at major U.S. container ports in the first half of 2023 will fall 22% from the same period last year, and U.S. imports will fall back to pre-pandemic levels.

Li Gangqiang believes that in addition to the above factors, it may not be because Temu's traffic has decreased, but because the number of sellers on the platform has increased . With the explosion of traffic, many new sellers have flooded into the platform, and the competition has become more intense. Everyone is sharing the traffic. Under this circumstance, Temu also has the confidence to further lower prices, anyway, there will always be new "leeks" entering the market.

Alex said that the price cuts by the platform over and over again are not reflected on the consumer side. The pricing at the front end will not change. For example, if a product is sold at $10, this price is already lower than other platforms such as Amazon. It is meaningless to reduce the price at the front end. The final profit after the price cut goes to the platform . For example, Temu initially added 10 points to the seller's supply price. After layers of price cuts, the platform's profit may increase to 30 points.

The price dropped, the traffic disappeared, and the sellers don’t understand the game anymore.

Whether it is the platform’s price pressure or unstable traffic, the decline in orders makes it difficult for sellers to adapt to the platform’s rhythm.

Alex told Yienjun that the most frustrating thing for Temu sellers is that they have no idea about the platform’s positioning, and don’t know whether they specifically want factories or traders with supply chain advantages.

First of all, the supplier role that Temu wants is actually a factory. Now the traffic of many links is unstable. Buyers negotiate prices and require sellers to stock up in large quantities. But the problem is that if your product is promoted, the traffic of the link will increase rapidly. Once the advertising department of the platform stops promoting it, the seller’s link will be like "dead" and can only be cleared. Factories cannot adapt to this risk at all.

Secondly, if the link is only stable for a period of time, then this method is more suitable for traders, because traders can quickly adapt to the logic and rhythm of this supply, but there are also certain risks, because once the traffic takes off, the platform will carry out rounds of price reduction until there is no profit margin, then where does the price difference for traders come from?

Finally, whether it is a factory or a trader, sellers may encounter a problem: the price has dropped and the traffic has disappeared, because a price reduction does not necessarily mean that your products will continue to sell well, because the platform does not implement a relatively transparent horse racing logic.

Fundamentally, Alex believes that Temu is a new platform that is in a period of rapid growth and there may not be a perfect mechanism at present. Only when the platform has a clear goal can sellers move forward better.

Alex disagrees with the complaints from many of his peers that Temu will only reap a wave of traffic in the short term and will not adhere to long-termism. He thinks that Pinduoduo is a big company after all, and its ambitions go beyond just making quick money.

(Alex and Li Gangqiang are pseudonyms in this article)

Temu

Traffic drops significantly

Seller