Amazon's low-price mall is trying to challenge Temu

On November 12 last year , Amazon launched its low-price mall section, which caused quite a stir in the industry.

However, the thunder is much ado about nothing, and the low-price mall that wanted to compete with Temu seems to be moving further and further away recently.

With discounts up to 90%, Amazon's low-price mall is losing money selling goods

According to foreign media reports, it seems that in order to quickly attract a wave of users in the early stage, Amazon's low-price mall started a crazy subsidy mode some time ago.

Some consumers have found that by combining clearance discounts, discounts for purchases above a certain amount, and general discounts, some products can be discounted by up to 10%, which is almost equivalent to not spending any money!

The consumer cited his own situation as an example. After adding a total of 14 products to the shopping cart, the original price of the products displayed was nearly US$80 in total. However, after adding multiple discounts, the consumer only had to pay another US$8 including shipping costs.

The size of this discount is really exaggerated. It is obvious that Amazon is completely losing money by selling products at this price. But for a "newcomer" whose selling point is low prices, it would be unreasonable not to lose some money in the early stage to attract users.

However, as a low-price mall launched in response to Temu, even if it offers a discount of up to 90%, it is still quite far behind Temu.

Judging from the sales data, Amazon's low-price mall can only account for a small part of Temu. However, relying on the traffic earned at a loss, the recent growth momentum of the low-price mall is indeed not to be underestimated.

According to data provided by Marketplace Pulse, the number of products from Amazon's low-price mall on Amazon's top 100 best-selling list has increased from 2,700 during last year's Black Friday to 4,200 in January this year.

Industry insiders analyzed that although low-price malls have indeed produced a lot of hot-selling products in the short term, it is hard to say whether they can gain a foothold in the low-price market in the future.

This is because, compared with competing platforms, low-price malls are obviously insufficient in advertising investment. Previously, Temu had twice placed advertisements in the American "Spring Festival Gala" Super Bowl event. Although it paid a sky-high advertising fee, the publicity effect it brought was also very obvious, and low-price malls obviously lack such courage.

On the other hand, in addition to facing the siege of competing platforms such as Temu and SHEIN, changes in macro policies have also brought considerable challenges to Amazon's low-price mall.

US tariffs hurt Amazon

On February 1, local time , US President Trump signed an executive order, canceling the US "minimum" tariff exemption for small goods "valued at less than US$800" and imposing a 10% tariff on Chinese imports.

However, Trump later announced in an executive order that the duty-free treatment for small packages from China will continue to be effective until "adequate systems are established to fully and promptly process and collect tariff revenues."

Data shows that the number of goods entering the United States through "minimum" tariff exemptions has increased significantly over the past 10 years, from about 139 million pieces per year in fiscal year 2015 to more than 1 billion pieces per year in fiscal year 2023, an increase of more than 600%. In fiscal year 2024, the number of "minimum" goods rose again to more than 1.36 billion pieces.

Among them, a considerable number of small packages of goods are shipped from China to the United States. Although Trump hopes to close this so-called "loophole" in order to crack down on low-price platforms such as Temu, it has also invisibly caused a huge impact on Amazon's low-price mall.

Previously, data from Marketplace Pulse showed that almost all sellers in low-price malls are from China, and most of the goods are shipped from China.

This means that the low-price mall’s ability to provide low prices may be lost in the future. Once the $800 tax exemption policy is officially cancelled, the low-price mall will have to adjust its strategic direction from scratch.

Industry insiders analyzed that the "minimum" tariff exemption may have an impact on profit margins of about 5 percentage points, while e-commerce companies usually only have a profit margin of 10% or 15%, which will be a catastrophic blow to them.

It is understood that in order to reduce the impact of the new tariff policy, Temu has stated that the US station will continue to strengthen the reduction from full-service to half-service. SHEIN has also been strengthening its overseas warehouse layout in Europe and America in the past two years.

However, industry insiders believe that in the short term, the new tariffs will still have a significant negative impact on the profit growth and sales of platforms such as Temu.

Temu is also having a hard time

According to Second Measure, Temu's U.S. sales plummeted in the five days between February 5 and 10, 2025, falling by about 32%.

The industry generally believes that the decline in Temu's sales may be related to the adjustment of the US tariff policy. On the other hand, the increase in Temu's front-end prices is another reason for the decline in sales.

Recently, a group of Temu sellers reported that the prices displayed on the Temu front desk suddenly increased to varying degrees, ranging from a dozen US dollars to as high as several dozen US dollars.

Not only sellers have noticed the price increase, but many American consumers have also keenly noticed the price changes.

According to Bloomberg, many American consumers are worried that commodity prices may fluctuate significantly in the future, so they are currently in a wait-and-see state, and their purchasing behavior will be delayed or even reduced.

On February 13th local time , Trump once again announced that he would implement a "reciprocal tariff" policy. The National Retail Federation of the United States issued a warning that this move may further push up commodity prices, and ordinary American families will lose their desire to consume in the face of high prices.

Although Trump announced a few days ago that he would suspend the cancellation of the "minimum" tax exemption policy, the uncertainty of the future still dealt a heavy blow to Temu.

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