China’s Shein or Temu are the No. 1 most-downloaded apps in half of the world’s fifty largest economies. Downloads are not revenue, but downloads indicate ambition.
Shein or Temu hold both the No. 1 and No. 2 slot in ten countries. In 25 of the 50 largest countries by GDP, either Shein or Temu are the most-downloaded shopping apps. One of the two is at least in the Top 10 in 10 more countries. Shein and Temu differ in their supply chain, category focus, and brand recognition. But they both represent the made, sold, and marketed by China iteration of commerce.
Temu is the most-downloaded shopping app in the U.S., France, Italy, Spin, Germany, and the United Kingdom. All told it is number one in 14 countries. Launched by China’s Pinduoduo only eight months ago, in early September 2022, it is the latest marketplace to bring China-made goods to Western consumers.
Shein is the connector between China’s garment factories with Western Gen-Z customers that dominated before Temu entered the market. It is still No. 1 in ten countries, but they are all markets Temu is yet to launch. Shein’s sales are significant though - according to The Wall Street Journal, sales on Shein reached $30 billion in 2022. The company projects global GMV to grow to $80 billion in 2025.
Temu is likely the fastest retailer in history to go from zero to scale, enabled by the parent Pinduoduo’s seemingly unlimited financial backing. In eight months since it launched in the U.S., it added fourteen more active markets like Australia, the United Kingdom, and Germany. To reach No. 1, it focused on marketing and gamified referrals to incentivize existing users to invite their friends. It worked; it has been number one in the U.S. since October.
Shein has been around for a decade but has exploded in popularity over the past few years. While initially a faster fast-fashion alternative built around a Chinse supply chain, it has since expanded to more categories, manufacturing in other parts of the world, and even launched a marketplace to add more supply. Crucially, it has built meaningful brand recognition as visible from its tens of millions of fans on social networking platforms.
Getting to No. 1 in app downloads is bought through marketing. Turning into a sustainable and profitable market share is a whole different challenge. Wish app before Shein and Temu achieved number one status by, at points, being the largest advertiser on Facebook but couldn’t keep users returning without spending more on marketing. Shein solved it by building brand recognition and social following, Temu is yet to figure it out, but it likely has a runway that can last a long time. Both could end up in the same marketing trap Wish had.
Neither Shein nor Temu is the largest retailer in any country. App popularity indicates the direction of growth, not the size of the business. Thus, their rise in popularity is significant for two reasons. First, no other retailer is as aggressive to grow. And second, Shein’s and Temu’s ambitions are global and greater than their current offering.