The overseas version of Pinduoduo, Temu, has emerged as a promising player in cross-border e-commerce. While some sellers have found new growth opportunities, others have exited the platform disappointed. The question remains: Can Temu replicate Pinduoduo's domestic success internationally?
The Boom: Product Selection and Pricing Strategies
One seller shared her positive experience with Temu: "After two months on the platform and one month of active selling, I've achieved over 2,000 orders." While modest compared to some platforms' daily sales records, she finds the consistent 60 daily orders satisfactory in current market conditions.
"The profit margin is low at about 20%, but the fast turnover makes up for it," she explained. Her strategy involves mass product testing - initially listing 150 items before narrowing down to 70 performers. Notably, 90% of her revenue comes from just two bestsellers, highlighting the critical importance of product selection and competitive pricing.
The Bust: Low Prices and Operational Challenges
Contrasting this success story, another factory-based seller is liquidating inventory to exit Temu. She cites two primary frustrations: delayed platform responses and unsustainable pricing demands.
The platform's rapid expansion has strained its support capacity, with many product categories managed by just one or two account managers. Additionally, Temu's aggressive pricing strategy, while attractive to consumers, leaves minimal profit margins for sellers. The requirement for extensive product variations further increases production costs and inventory risks.
"They promise full-store promotion for listing 50 products, but it takes weeks just to get items listed," the seller complained. "My September shipment only went live recently. I'm done with this platform."
Temu's Strategic Challenges
Unlike previous failed Chinese overseas ventures, Temu shows staying power but currently attracts primarily small export factories and Amazon sellers clearing inventory. The platform's ambition to recruit category-leading Amazon sellers faces obstacles from its intense price competition.
Temu must carefully balance several competing priorities: maintaining value-focused positioning for budget-conscious consumers, preventing destructive price wars among sellers, and creating space for premium sellers without squeezing out smaller vendors.
Strategies for Seller Success
Sellers can improve their Temu performance through several approaches:
Precision Product Selection: Move beyond random listing to data-driven identification of high-demand, differentiated products through market research and sales analytics.
Dynamic Pricing: Implement tiered pricing structures and strategic promotions to maintain competitiveness without sacrificing all profit margins.
Supply Chain Optimization: Streamline production and logistics to reduce costs and improve delivery times through reliable shipping partnerships.
Platform Engagement: Maintain proactive communication with Temu representatives while closely monitoring customer feedback for continuous improvement.
Channel Diversification: Develop presence across multiple sales channels including other marketplaces and independent stores to mitigate platform dependency risks.
As Temu continues evolving, sellers must remain adaptable, combining operational efficiency with market responsiveness to navigate this competitive landscape.