Until recently, both brands relied on an aggressive online advertising strategy to attract a young, bargain-hunting audience by promoting low-cost products shipped directly from China.
But an executive order signed earlier this month by President Donald Trump threatens this model. From May 2, goods worth less than $800 shipped from China and Hong Kong will no longer be exempt from customs duties.
To cope with the higher costs, Temu (PDD Holding) and Shein plan to raise their prices as early as next week. At the same time, they are reducing their advertising presence on most platforms, according to two companies that specialize in analyzing digital marketing spending.
According to estimates by Sensor Tower, Temu reduced its average daily advertising spending in the US by 31% on Facebook (Meta), Instagram (Meta), TikTok (Bytedance), Snap, X, and YouTube (Alphabet) between March 31 and April 13, compared to the previous 30 days.
Shein, meanwhile, reduced its spending by an average of 19% on Facebook, Instagram, TikTok, YouTube, and Pinterest during the same period.
Meta declined to comment on the data. Google, Shein, and Temu were not immediately available for comment either...
According to Mark Ballard, director of digital marketing research at Tinuiti, Temu has significantly reduced its investment in Google Shopping since April 12, following a sharp increase in the first quarter.
With Reuters
