Temu: What is it, how do I pronounce it, and why is it so cheap?

It is not even two years old but already Temu is one of the most popular shopping apps in Internet history with close to 100 million users in the EU alone, more than twice that number in the US and well in excess of 30 million downloads of its app worldwide every single month.

But what is it? What does it sell? Are there really bargains to be found and why are consumer groups and legislators so troubled by Temu?

Okay, so, can we start at the start. What is Temu and how do I pronounce it?

It’s Tee Moo and at its most simple it is an online shopping portal, not unlike Amazon Marketplace. It doesn’t actually sell products as a traditional retailer might and instead offers places on its platform to others who can then sell their wares directly to the consumers. It is owned by the Chinese company PDD Holdings.

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Who are PDD Holdings?

You might not have heard of it but it is absolutely massive in China and routinely swaps places with Alibaba as the most valuable Chinese firm listed on a US stock exchange. It is worth in excess of €150 billion.

So, Temu is like Etsy, is it?

Hmm, not entirely .... or indeed not at all. Etsy is an online marketplace for sure but is mainly about giving a platform to small and artisan producers from all over the world to sell cute things while Temu gives consumers from all over the world direct access to Chinese factories making all manner of products.

And when you say all manner of products?

We mean it. Its categories cover everything from clothes, homewares and tech to musical equipment, office supplies and health and beauty and a whole lot more besides. If you can imagine something existing, you will most likely be able to find it for sale on Temu. The company says that it has more than 80,000 suppliers selling in excess of 25 million products.

And it’s cheap?

Almost comically so. Some of its prices make Penneys look like Harrods. Temu says it sells its stock for around 70 per cent less than comparable products on other platforms. Among the best selling products last week were a portable, rechargeable juicer for just under a tenner, a 184-piece first aid kit for less than €7, some white ear buds – that look suspiciously like a far more expensive brand that shares a name with a fruit – for a little over €16 and a calming dog bed for €8.

A calming dog bed?

No, we have no idea what it is but if it helps to chill out the Pricewatch puppy who is as likely to hump his bed as sleep in it, we’re there for it.

Why is it so cheap – the site not the calming bed?

Temu says its low prices can be explained by efficiencies all along its supply chain. It cuts out middle men and its sellers source products at scale from manufacturers at heavily discounted prices. Because they are shipping large volumes they can consolidate costs – or so the story goes. It also helps that as an e-commerce enterprise it is exempt from export duties in China. And because its products tend to be so cheap end-users here and in other countries frequently do not have to pay any duty.

Is it easy to find stuff on Temu and to navigate the site?

Yes and no. The search functionality and categorisation is pretty good but the site is nowhere near as calming as the dog beds it sells. Imagine the middle aisle of a German discounter on a cocktail of cocaine and magic mushrooms wandering into a Las Vegas casino by mistake and you’re getting close to what Temu is. If the ghost of Hunter S Thompson could be bothered setting up an online platform to sell an almost infinite amount of tat this might be what he’d came up with – although he might also stock some class A drugs.

This site sounds amazing why have I never heard about it before?

We have no idea. Maybe you’re not as in thrall to social media as some of us. Many social feeds have been flooded with influencers bragging about their Temu hauls for months now. It is all over Google and if you were in the US and one of the 123 million people watching the Super Bowl earlier this year you would have found it hard to miss Temu. It had six of the coveted – and wildly expensive – advertising slots during the American football showpiece.

Wildly expensive?

Each of those slots cost around €7 million so Temu was happy to spend over €40 million on one night of ads in the US. Mind you that spending is in the ha’penny place compared to its total advertising budget.

Go on?

The scale of Temu’s spending is simply massive. It spent €1.5 billion on Google Ads alone last year.

Who are its main competitors?

In short, every retailer everywhere. Digital marketing agency Wolfgang Digital has conducted research across its retailer customer base that shows Temu was in direct competition with all Irish online retailers during the last quarter of 2023.

And is that bad?

It is if you are in Irish retail or like shops existing. The Wolfgang data “confirms what many in the industry had suspected [that] Temu is aggressively targeting the Irish and all geographic markets by purchasing ads targeted at customers across a wide range of product categories from fashion to DIY, from electrical to furniture and everything in between”, the agency said.

Is the stuff Temu sells good?

Good is a relative term, isn’t it. The site sells a lot of dupes or products designed to look like better known brands for a lot less than the brands sell them. If you want hair care products that look a bit like Dyson but sell for a tenth of the price then Temu will have you covered. A watch that looks uncannily like an Apple Watch is selling for less than €40. Will such products be as good as the branded versions? When it comes to the Dyson dupe we can’t answer definitively as we have neither the product or the hair to test it out but we would have deep suspicions about the quality or the staying power of any knock-offs that sells for a tenth of the price of the mainstream product.

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It seems to be growing really fast. Where are all the shoppers coming from?

Everywhere. It drums up business through a mix of referrals, judiciously placed ads, social media mentions and a gamified way of shopping.

What does all that mean?

Well, users who successfully refer others to the platform or share content and discount codes are rewarded with credits that they can spend on the site. It also works with social media influencers to drive traffic with the Temu hashtag on Tik Tok currently having close to 6 billion views while the temuhaul hashtag has racked up over 2 billion views.

And you said something about gamification?

People can also get more credits by logging in frequently and taking part in competitions and it invites people to play games with more credit as prizes.

It probably collects a lot of user data, right?

It has a system that collects and mines user data on a scale that is scarcely imaginable. It is constantly following consumer trends, and tracking what people are looking for and looking at and then passes that info on to factories in China who can then cater for the capricious whims of consumers almost in real time. That sets it apart from the likes of Amazon which also collects loads of data from its users. It sells its data, Temu gives it away on the understanding that the manufacturers who get it will list their products on the site.

So it just uses some of the data it collects to help manufacturers make the products we want?

That might not be all. It has also got into trouble over some of its promotions and not long ago had to change the terms of a cash giveaway after concerns were expressed by users over what they were giving away. People were promised around €50 for referring others to the platform but then they found out that “except to the extent prohibited by applicable law”, they had given Temu consent to use and publish their “photo, name, likeness, voice, opinions, statements, biographical information, and/or hometown and state” for advertising or promotional purposes “in perpetuity”.

Wow and all that for 50 quid? That’s a bargain for Temu right there?

It might have been but the outcry forced it to tweak its Ts&Cs “to make it clear that we only ever use username and profile pictures in this promotion for referral functionality and winner announcements”. It accepted that the “previous terms and conditions were overly broad and inadvertently included promotional uses that Temu does not engage in”, it said.

Talk to me about returns

The site has a 90-day return window after the day of purchase but it rarely asks for products to be sent back as its prices are so low that the cost of processing returned items simply isn’t worth it.

So I could just buy a product, claim it didn’t match my expectations and they’d let me keep it and give me my money back?

You could probably do that for sure but given the cost and quality of the products and the impact such behaviour might have on your karma would you be bothered?

Hey, I’m the one asking the questions here. Are there any downsides to Temu?

Indeed there are. It is not all bargains and games, and there are many ethical and environmental concerns that can’t be ignored.

What do you mean by that?

Well, take the environmental concerns first. Do we really need a retailer selling millions of products – many of which rely heavily on plastic – and shipping them all over the world only to have many of them to end up in landfill? And that is just one problem with Temu.

Are there more?

For sure. There are grave concerns about the provenance of its stock and who is making it and how those who make the products are being treated.

What kind of concerns?

The US house select committee on the Chinese Communist Party is of the view that Temu does not ensure what it sells complies with US laws on forced labour. The head of the UK’s foreign affairs select committee, Alicia Kearns, told the BBC last year that there needed to be more scrutiny of Temu to ensure “consumers are not inadvertently contributing to the Uyghur genocide”. In response to queries from the British broadcaster Temu said it “strictly prohibits” the use of forced, penal or child labour by all its merchants.

And is that all Temu has said about that?

No. It has repeatedly said that anyone doing business with it must “comply with all regulatory standards and compliance requirements. Temu’s merchants, suppliers, and other third parties must pay their employees and contractors on time and comply with all applicable local wage and hours laws. Our current standards and practices are no different from other major e-commerce platforms trusted by consumers, and allegations in this regard are completely ungrounded,” the company said.

And are those statements accepted?

Not really. The US house select committee has pointed out that Temu does not have an auditing or compliance programme to ensure sellers remain in compliance with its code of conduct..

And what about transparency?

It seems to be lacking. Last week consumer groups across Europe warned that Temu frequently fails to provide information about the sellers on its platform and offers inadequate information about its system of recommendations and the criteria used to lead shoppers to certain products.

The Bureau Européen des Unions de Consommateurs (BEUC) said Temu was “rife with manipulative techniques – dark patterns – to get consumers to spend more than they might originally want to, or to complicate the process of closing down their accounts”.

Was that all?

No. Beuc also accused Temu of breaching the EU’s new online content law, the Digital Services Act, on all of the above points and called for it to be investigated by the authorities.

And what had Temu to say about that?

In response to queries from The Irish Times, a spokeswoman said Temu was “a newcomer to Europe” and had been “actively adjusting our service to align with local practices and preferences, and we are committed to full compliance with the laws and regulations of the markets where we operate”.

She said the company aims “not just to meet the minimum legal requirements but to exceed them by adhering to the highest standards of best practices”.

She suggested that the company’s “commitment to compliance and our willingness to engage stakeholders globally can be seen in our proactive actions”.

Regarding the specifics of the BEUC complaint, she said Temu “take it very seriously and will study it thoroughly. We hope to continue our dialogue with the relevant stakeholders to improve Temu’s service for consumers ... We are committed to transparency and full compliance with all applicable laws and regulations.”

Are there any other concerns?

There are. According to British consumer watchdog Which? ”every product we looked at on Temu had a discount applied, but it isn’t clear how long each product has been at that price or how long it was at the ‘was’ price”. That carry-on would not be allowed in Ireland.

Was that it from Which?

Nope. It also noted that – as with other online marketplaces – Temu does not verify the products selling on its platform. It tested electric heaters bought on the site earlier this year and all three of them “were found to be electrically unsafe and can’t be sold legally in the UK”.

At the time Temu told the magazine “that the safety of its customers is its highest priority, and that proactive monitoring systems had detected and removed two heaters in December”.

As part of another investigation, Which? found “cheap electricals such as chargers and plugs across a variety of marketplaces including Temu that fell apart during a brief stress test”.

Well that’s not good, is it?

It gets worse. The Toy Industries of Europe (TIE) sourced 19 toys from Temus last February and none were in full compliance with EU legislation while 18 posed a safety risk for children. Among the hazards identified were cutting, blockage, choking, strangulation and chemical dangers.

So, would you shop on Temu?

Pricewatch has not shopped on Temu but we did ask users of the platform formerly known as Twitter about their experiences. Here are just a small sample of the responses.

Once you buy they absolutely torture you on email to buy more stuff. They send you offers non-stop. Spin the wheel for discounts and free stuff. It’s endless. Once they have your email it’s endless. Lots of the stuff is quite poor quality. Orlaith Blaney

Ordered some jewellery and some summer tops, other bits and pieces. All were fine, arrived on time. Absolutely no problems. After you sign up to alerts to get discounts unsubscribe from everything because you will get bombarded with marketing. Dozens of alerts daily. J Magennis

On the advice of a friend I ordered bits and pieces from Temu. All arrived in good time and were as described on the tin. Their non-stop pushing of products is way over the top, though. Mary Conlon

I love Temu, huge choice, great value and fast delivery service. I’ve bought several bargains ranging from silicone to silk, literally! E.g. 100% silk pillow cases €19.28, pack of 3 silicone air fryer liners €9.97. Eileen O’Duffy

Brilliant for party supplies of any kind and gadgets. Bought a usb automatic garlic crusher, brilliant thing! Dee Farrelly

I bought some knick-knacks & some clothes & all as described. Good size, good quality & sooo cheap. I will definitely buy from Temu again. Liz Luke

I have bought several items, and very happy with them all, got plenty of lovely tops and trousers on it and a video doorbell for €15, absolutely brilliant, plenty of knickknacks, even my husband likes the stuff and he’s a farmer who doesn’t believe in knick-knacks. Mary Cuddy

Woeful, sent more than half the stuff back. AJ Walsh