Temu may have snatched more than 10 million Amazon users in the United States

As more and more American consumers begin to downgrade their consumption due to inflationary pressures, Temu's orange packaging has become more and more common in delivery stations across the United States.

Perhaps more than any other e-commerce platform, Temu keeps users hooked on a constant shopping spree, keeping them chasing newer, better products they never knew they needed.

Its factory-to-consumer business model keeps prices rock-bottom, while banners on the site tout 70 percent discounts and tell users who’s just bought an item.

GlobalData's social media analysis shows that Temu is now the most downloaded app in many Western countries.

Meanwhile, mobile analytics firm GWS found that Amazon's U.S. user base fell sharply from April to July 2023, from 54 million daily active users to 46 million daily active users.

By comparison, Temu has added nearly 10 million new users since the beginning of the year , tying it for second place with Walmart.

In addition, the average time users spend on Temu is 20 minutes per day, while Amazon only spends 12 minutes.

In the UK, Amazon lost 1 million daily active users between January and July, while Temu saw a significant increase in daily mobile users to 3.5 million just one month after its launch.

However, Amazon does not seem to be interested in competing head-on with Temu. In June, it decided to exclude Temu from its price-checking algorithm, saying it did not meet its fair pricing policy standards.

In terms of customer base, the two e-commerce giants also seem to be targeting different customer segments. Amazon has more brand sellers with high customer unit prices, while Temu's products are mostly unbranded and rarely exceed $20.

Some may also wonder how long Temu's success will last. At least a large part of Temu's recent success is due to its advertising and expensive marketing. It spent millions of dollars on two 30-second Super Bowl ads with the catchy tagline: "Shop like a billionaire."

However, Patrick O'Brien, director of global retail research at GlobalData, said that despite this, Temu still poses a very big threat to Amazon: "Since Amazon is more of a platform for sellers, it cannot focus all its energy on selling its own products."

The competition between Temu and Amazon has not yet reached its peak, and only time will tell whether the former's "shop like a billionaire" business model will have a substantial impact on Amazon .

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