With Christmas and New Year, the business war between European and American e-commerce has also entered a "white-hot" stage. According to foreign media reports, the American e-commerce giant Amazon is adjusting its business strategy to face the increasingly fierce competition with Chinese e-commerce platforms to compete for market share.
“The U.S. e-commerce giant faces an uphill battle in protecting its local market against companies such as Temu, fast fashion site Shein and ByteDance’s TikTok Shop,” Hong Kong’s South China Morning Post reported on the 24th that multiple sellers revealed that the U.S. retailer began tracking product pricing on Temu and asked some Chinese cross-border merchants to stop selling goods at lower prices on rival platforms.
The merchant said that the local office of Amazon in the United States recently notified the managers of some of China's best-selling brands that they are not allowed to sell the same products at lower prices on Temu. According to a merchant who sells furniture on both platforms, if Amazon finds that sellers are selling goods at too high prices on its platform, they will be kicked out of Amazon's "Featured Offers" program.
In response, an Amazon representative recently responded, "Sellers decide their own sales strategies and set their own product prices in the Amazon store. Amazon will not require them to set a certain price."
Last week, Anker, a well-known mobile power supply and charger brand, suddenly removed more than 40 products from Temu. Since then, rumors have begun to circulate that Amazon is pressuring sellers to prioritize them on its platform. A cross-border e-commerce operator revealed: "Many brands have opened brand stores in Temu before, but after receiving the warning letter the night before yesterday, they urgently removed the products overnight. This pressure has not yet spread to small sellers, but almost all the top 20 brands have received warnings." On Monday, Anker's official U.S. store in Temu no longer displays products, but its German store is still operating and lists 18 products.
According to Reuters, Amazon had previously excluded Temu from its price comparison system.
"In the past few years, as e-commerce companies rooted in China such as fast fashion brand Shein and online supermarket Temu have become popular in the United States, the tone of our shopping has also changed - shoppers no longer choose fast delivery, but are willing to wait for weeks for packages full of goods to be shipped back to the United States from China," the American technology media "The Verge" wrote. Chinese e-commerce is becoming popular among American consumers with its preferential prices and rich categories, which puts local giants such as Amazon under pressure. According to SensorTower's data analysis, as of August 2024, Temu's global number of users has reached 91% of Amazon, and it is expected to surpass Amazon, which has been founded for 30 years, within this year.
Although it once strongly condemned low-price competition, now, as platforms such as Temu become more and more popular, Amazon has begun to change its stance and copy the path of Chinese e-commerce. According to a report on the US CNBC website on the 22nd, two weeks before "Black Friday", Amazon quietly added a new section of Haul at the top of its mobile application that focuses on low-price products. It mainly provides ultra-low-price products shipped directly from China, such as $9.98 sneakers, $5.99 kitchenware and $2.99 mobile phone cases.
"The Verge" commented that Haul's page "looks a lot like Temu, Shein and AliExpress", and "Business Insider" even called it "a lame version of Temu". "The problem is the product selection, which isn't all that different from Temu, or even a lot of the stuff Amazon sells on its regular site. Prices on Haul are actually sometimes slightly higher than on Amazon." Business Insider added, "One of Temu's great features is that it has a variety of All kinds of weird stuff you didn’t know you needed. When you open the app, you’ll see rubber cable organizers you don’t see anywhere else—you’ll find weird, new, cheap items. In my opinion, Temu’s greatest strength is the variety of its new products—not just the cheap stuff.”
Salesforce's November 2024 Consumer Sentiment Survey shows that 21% of Americans surveyed believe that emerging e-commerce platforms such as Temu are more enjoyable than traditional shopping. Half of them said this is because they can shop at low prices, while 47% particularly enjoy the "treasure hunt" experience.
At the same time, the cost of lower prices is slower shipping. Unlike Amazon Prime, which typically ships within one to two days, items on Haul take one to two weeks to arrive. The CNBC website stated that Amazon has been courting Chinese sellers for many years, but it usually plays the role of a middleman and stores goods in U.S. warehouses in advance. This increases delivery speed and costs Amazon, but these costs are passed on to consumers in the price of the goods.
Although it "learns" from Temu's business model, Haul currently adopts a targeted invitation system for sellers, which means that not all merchants can "enter". This also results in the product category richness of Haul's platform not being as rich as Temu's, and it seems that it fails to show competitiveness in terms of price.
"Amazon seems to be planning to walk on 'two legs'," industry insiders commented, focusing on "brand" on one side and "low prices" on the other. I don’t want to give up the traffic of the main website, nor do I want to lose the dividends of low-price retail. Forrester retail analyst Kodali told the BBC that the project was not without risks for Amazon. There is evidence that consumers are “increasingly fed up with poor quality goods and slow shipping”. If the product doesn't meet the needs of shoppers and make Amazon profitable, "I don't foresee Haul being around for long," she said.
Although Amazon is still the largest e-commerce entrance in the United States, various platforms are trying their best to seize the market. Under this competitive situation, the diversion of orders and traffic has become an inevitable trend. Under this circumstance, although the launch of the Haul project as a means of diversion is a positive response strategy for Amazon, it still takes time to test whether it can bring new growth points.
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