Pinduoduo, an e-commerce company based in China, recently created a new overseas online shopping website. As part of its overseas expansion, the company has launched Temu, which could potentially be Amazon’s latest competitor. This one of the biggest e-commerce sites is accused of worst working practices.
Pinduoduo opens an online shopping site in the United States
(Photo: Zhong Zhi/Getty Images for CNBC International)
NANSHA, CHINA – NOVEMBER 18: David Liu, Vice President of Strategy, Pinduoduo talks with CNBC Senior Correspondent Arjun Kharpal during day two of CNBC East Tech West at LN Garden Hotel Nansha Guangzhou on November 18, 2020 in Nansha, Guangzhou, China.
The e-commerce industry has grown over the past few years with companies like Amazon still dominating this field. However, the Seattle-based company shouldn’t be relaxed with the idea that it monopolizes this service.
Last month, Pinduoduo announced plans to enter the United States with a business model that could match Amazon, according to Fortune’s previous report. Now it looks like it has already happened.
According to a recent CNBC report, the Chinese firm has succeeded in its push abroad by launching Temu, its online shopping site in North America.
The site went live on Thursday, September 1 for customers across the United States. Like any other e-commerce site, it offers a wide variety of products, ranging from home equipment to clothing and more.
Pinduoduo created a ripple in this major instance, especially showing its presence against the Amazon powerhouse in the west. In China, its main competitors are JD.com and Alibaba.
Despite its short stint as an e-commerce company, it has already managed to outperform those companies with a longer tenure than it. It was created in 2015, but it has already made waves around the world.
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Pinduoduo must survive in the US market
The company’s cross-border website, Temu, features products primarily from China. According to the report, shipping goods to the United States could take at least seven business days.
Interestingly, Pinduoduo will not charge shipping for orders over $49. However, to thrive on foreign soil, it is necessary to improve its brand image, especially if it goes against Amazon, a very established brand in the region.
According to WPIC CEO Jacob Cooke, Temu would need to gain customer trust and awareness in the United States before expanding. For those who don’t know, Cooke is a marketing expert who helps overseas customers sell their products in China.
Cooke added that Temu sells many products at a very affordable price. That alone might be enough to attract potential long-term buyers.
Apart from that, Pinduoduo has a strong connection with low-cost manufacturers in its home country. The good news is that they may not have kept in touch with US-based companies yet.
Accordingly, the e-commerce giant will aim to target consumers who prefer to buy products at low prices. With the competitive discounts it offers for some of its products, it’s no wonder it will survive the tough US market for years to come.
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Written by Joseph Henry
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