Money Talks from The Economist Money Talks: Why Amazon should be afraid of Temu
45 snips
Mar 21, 2024 Amazon faces competition from Chinese e-commerce giant Temu as they battle over market dominance in the US. Timu's aggressive marketing strategy, cheap unbranded products, and innovative business model challenge Amazon's position. Insights from Etsy's CEO shed light on the competitive landscape of e-commerce. Additionally, the hosts discuss the unexpected crow population boom in downtown Portland, drawing humorous parallels to the competitive dynamics between Temu and Amazon.
AI Snips
Chapters
Transcript
Episode notes
The Bead Challenge
- Alice Fulwood and Tom Lee-Devlin ordered the same beads, one from Temu and one from Amazon, to compare price and delivery speed.
- Temu offered significantly more beads for 60% of Amazon's price, but with a delivery time of up to two weeks compared to Amazon's next-day delivery.
Price Over Speed
- Temu's slower shipping times don't deter American consumers, who are drawn to the platform's extremely low prices.
- This suggests that affordability outweighs delivery speed for many online shoppers.
Temu's Business Model
- Temu ships directly from factories in China, cutting out US warehousing costs, leading to lower prices.
- This direct-to-consumer model also allows Temu to exploit a US import rule, avoiding duties and stricter customs scrutiny for packages under $800.