The controversial e-retailer Temu has been attracting attention after it reportedly dropped an astounding $21 million on Super Bowl ads this year.
Temu is the latest shopping craze to gain a hold among U.S. consumers. The Chinese e-retailer offers nearly every product one could possibly want at extraordinarily low prices. It has received comparisons to Shein, Amazon, and Wish and incorporates aspects of all three e-commerce companies. According to Temu, it keeps its prices low by utilizing a Next-Gen Manufacturing (NGM) model, allowing buyers and sellers to connect directly and surpass typical commerce costs. This allegedly allows Temu to offer prices that consumers will be hard-pressed to find elsewhere.
The products sold by Temu are pretty varied, ranging from clothing to home decor to technology to jewelry. However, what all these products share in common is that they’re all usually under $30. Sometimes, the products even fall under $1, with things like jewelry falling into Temu’s special $.98 offerings.
Temu has surged in popularity in a startlingly short amount of time. Despite only launching in September of 2022, it is already proving to be quite the competitor in the U.S. market, even against seasoned giants like Amazon. Its success has raised curiosity among consumers but also suspicion, and rightly so. Fast fashion brands like Shein, which has been under scrutiny and in legal trouble for everything from worker exploitation to copyright lawsuits, have made consumers wary of prices that seem too low to foster a sustainable business model.
Labor exploitation may cause concern with Temu, but other potential issues have also crept up regarding user privacy and trustworthiness. Here’s everything you need to know about Temu.
What’s up with Temu’s Super Bowl ads?
Viewers watching Super Bowl LVII were reminded of Temu, repeatedly. The company aired three separate commercials during the Super Bowl, each of which cost the company $7 million, and each of which seemed to run many, many times throughout the game.
One of Temu’s Super Bowl commercials was designed like a children’s computer-animated show, as it depicted a number of various individuals buying all the cheap products their hearts desire. It also encouraged viewers to “shop like a billionaire.”
The purpose of the ads was to give the company a boost, as it has actually begun declining in recent months. Despite its strong start, Temu has been bleeding customers as it experienced a 12.5% drop in sales in December and a 4.8% drop in January. A recent survey also found that one-third of Temu users are planning to shop less on the app in the future. While the ads did spark an initial rise in Google searches for the company, they also reignited criticism.
The drop in sales and customers Temu experienced is likely a direct result of its unethical business practices. The harsh response to the Super Bowl ads is further evidence that some Americans are starting to become more cautious about supporting exploitative businesses. Most internet users displayed frustration about being exposed to the Temu ads and even criticized the Super Bowl for giving these spots to the company.
Despite all the backlash, searches and app downloads have still been rising since the Super Bowl. Often, as long as something is cheap, many customers don’t question what means the company utilized to offer such unusual prices. For those unfamiliar with Temu’s numerous controversies, here’s a rundown of its most significant issues.
Temu user privacy concerns
One concern that has arisen with Temu is that of user privacy. The majority of these concerns have risen not because of Temu but because of its parent company, PDD Holdings. PDD Holdings is a Chinese multinational commerce group of which Temu is a subsidiary. However, Pinduoduo is another subsidiary of PDD Holdings that has gained quite a bit of notoriety. Like Temu, Pinduoduo was an extremely popular shopping app catering to Chinese markets instead of American ones. Earlier this year, though, Pinduoduo was removed from the Google Play Store after multiple experts identified malware within the app.
According to CNN, when cybersecurity experts probed Pinduoduo, they found some pretty sophisticated malware. The app was made with a code that allowed it access to far more data than apps are normally supposed to access. It was able to update itself automatically, prevent users from uninstalling it, access users’ activity on other apps, and even access private messages. Having Pinduoduo and Temu come from the same parent company has made users a little leery of Temu.
However, there has been no evidence that Temu contains malware or steals user data. Yes, Temu does require some data access to things like your location, device, payment info, and contacts. This isn’t much different from other apps’ access, though, and it certainly doesn’t come close to the extensive privileges or access to one’s phone that Pinduoduo did. Additionally, it is believed the threat from Pinduoduo primarily targeted Chinese users, not Americans.
That hasn’t stopped some from accusing the app of being “tied to foreign adversaries,” which is the excuse Montana governor Greg Gianforte gave for banning Temu, WeChat, and Telegram from government devices in the state. So long as users exercise caution and are aware of what permissions they are giving apps on their phones, though, the possibility of Temu spying on or stealing data from consumers seems fairly small.
Temu labor exploitation concerns
While the user privacy concerns have largely been debunked, the potential of Temu being connected to forced labor has not been. In June of 2023, U.S. lawmakers warned consumers that there was a high possibility goods offered on Temu were produced from forced labor. It has been alleged that Temu may be abusing the U.S. de minimus provisions, which stipulate that items imported to the United States are not subject to tariffs or inspections so long as they are under $800 in value. While it’s not illegal for companies to take advantage of this law, Temu and Shein together are importing nearly 600,000 packages under $800 per day to the United States, and they could be doing this to hide ties to forced labor.
Additionally, it has been alleged that Temu violates the Uyghur Forced Labor Prevention Act (UFLPA). This act requires companies importing goods from the Xinjiang region to prove that the goods were not produced with forced labor. However, U.S. lawmakers allege that Temu doesn’t have any system in place for enforcing the UFLPA. A digital vetting company, Ultra Information Solutions, also found items listed on Temu that appeared to be produced from the Xinjiang region, though Temu attempted to hide the companies and origins behind the products. The U.S. House Select Committee on the Chinese Community Party wrote in a report that it’s almost guaranteed that “shipments from Temu containing products made with forced labor are entering the United States on a regular basis.”
Meanwhile, in November 2023, a shocking report came out about Pinduoduo’s work culture. Analysts suggested that the company’s work culture was more like “9127” than “996.” 996 already refers to a grueling work schedule in which employees work from 9 am to 9 pm six days a week. The 9127 would mean employees work from 9 am to 12 am seven days a week, which is an exaggeration but still highlights how aggressive the work culture is. Additionally, the report also drew attention to two employee deaths in 2021. Again, this is Pinduoduo, not Temu. However, since the pair share the same parent company, it wouldn’t be surprising if there were similarities across both companies’ work cultures.
Temu legitimacy concerns
While forced labor and user privacy concerns are the most serious controversies surrounding Temu, there has also been some skepticism about its legitimacy. The problem with determining its legitimacy is that everyone has had a different experience on Temu, and this really isn’t uncommon for a third-party marketplace. There are countless sellers in the marketplace, and not all of them are going to provide the same experience. Hence, some have reported ordering products on Temu, receiving them on time, and being satisfied that they lived up to expectations. However, others have claimed to have had negative experiences with Temu, such as orders never arriving, orders arriving damaged, or difficulty securing refunds for late orders or damaged orders.
Temu does allow customers to request refunds for missing orders or items and also offers a $5 credit for late orders. Sometimes, the refund may not match the order total, though, as refunds don’t account for things like sales and coupons. Some users reported difficulties in returning items, receiving refunds, or receiving a response from Temu.
On Better Business Bureau, Temu has a rating of C- and is filled with consumer reviews detailing the above mentioned issues. Most review sites show this mixed reception among consumers. What most customers agree on is that Temu products take a long time to receive, which the company notes on its website, and that the products are of very cheap quality, which is also to be expected. It doesn’t appear to be a rip-off given some consumers’ positive experiences, but one may have to temper their expectations to account for the long shipping times, poor product quality, and unpredictability of suppliers that arise from Temu’s extremely low prices and third-party marketplace structure.
(featured image: FG Trade)
Published: Feb 14, 2024 02:09 pm