PDD’s Temu enters South Korea as global budget shopping race with Shein, Alibaba heats up
- Temu kicked off its Asian expansion last month with a launch in Japan, and has signalled interest in the Southeast Asian market
- In South Korea, Temu will be competing against Alibaba’s AliExpress, which has established a foothold in the country
The local version of Temu is sticking to its low-price strategy, offering coupons up to 37,700 won (US$30) for new members and discounts as high as 90 per cent off on select items for a limited time.
It is a tried-and-tested playbook that has helped the online marketplace climb to the top of Google and Apple’s free-app rankings in the US, where it launched last year.
Temu is cooperating with third parties in South Korea to provide local customers with “last-mile” logistics and delivery services, according to a report by Chinese business news outlet Jiemian on Monday.
The move follows Temu’s arrival in Japan on July 1, which marked the app’s official debut in Asia. Temu is currently the No 1 shopping app on Japan’s iOS store.
The shopping platform is available in more than 27 countries and regions globally. Its owner, Chinese e-commerce giant PDD, also operates Pinduoduo, a separate app exclusive for China.
While Temu has not disclosed its next destination in Asia, in June it sent out a survey to sellers asking which platforms they were already using in Japan, South Korea and Southeast Asia.
Entering Southeast Asia would represent a new direction for the app, which has so far targeted mostly wealthier economies, where its low-cost goods produced by Chinese manufacturers hold a competitive price advantage over local rivals.
Temu did not respond to a request for comment on its plans for Southeast Asia.
In South Korea, Temu will need to contend with other China-originated shopping apps such as fast-fashion giant Shein, which was founded in the eastern Chinese city of Nanjing and is headquartered in Singapore, and Alibaba Group Holding’s AliExpress, which ranked fourth among iOS shopping apps in South Korea as of Tuesday.
AliExpress has found a foothold in South Korea, where its user base grew by over 150 per cent in three years, reaching 2.9 million as of April, according to data compiled by Forbes Korea. Alibaba owns the South China Morning Post.
The overseas market has become a new battlefield for companies like Temu, Shein and Alibaba, as competition intensifies in China’s e-commerce market amid sputtering economic growth.
