Monday, December 11, 2023

Shop like a millionaire: Temu’s strategy to offer low prices

Shop like a millionaire. ago managed to stand with a STRATEGY bold: allowing consumers to buy quality products at low prices, imitating the purchasing power of a billionaire.

Thanks to its motto Shop like a billionaire, this platform has changed the paradigm of online shopping.

This online sales site stands out for offering a wide variety of products, from home appliances, clothes, shoes, to devices such as wireless headphones and smartwatches, all at the lowest prices and with free shipping.

This proposal has created doubts among many users, who debate in forums and social networks about the authenticity of such offers.

Under the management of Chinese giant PDD Holdings Inc, ago It made its debut in August 2022 in the United States and arrived in Mexico in May 2023. Currently, this platform with very competitive prices operates in 41 countries spread across America, Europe, Asia and Oceania.

Read Also:  The Spring Air mattress and pillow kit for less than 3,500 pesos

Temu’s reach is visible in app stores. On platforms such as Android’s Play Store and Apple’s App Store, the Temu app leads downloads, surpassing giants such as Shein, TikTok and WhatsApp.

What is Temu’s business model to keep everything affordable?

The success of ago an e-commerce platform founded in Boston, Massachusetts, is in its new business model: consumer-to-manufacturer (C2M).

Through this strategy, consumers dictate demand, and manufacturers adapt to meet it. This process has a direct effect on the price, because the factories adjust their production based on the specific needs of the customers.

In contrast to the traditional system where brands produce products and then try to create demand, C2M, known as the “edge manufacturing model” in Temu’s terminology, enables manufacturers to refine their processes using information on market provided by the platform.

Acting almost like a consultant, ago provides continuous advice to manufacturers, from logistics to after-sales service, to guarantee production in line with current consumer expectations. This approach benefits users by offering products tailored to their needs and at competitive prices, as indicated by the company.

Read Also:  Hapag-Lloyd's profit plunges 67%, but its prospects remain intact

In addition, the essence of this method is reflected in the brand name. Temu, according to the company, translates as “group price increase” (come together to reduce prices).

With this strategy, Temu not only aims to eliminate intermediaries and optimize supply chains, but to transform online commerce, combining individual needs with global resources.

It is worth mentioning that they are not the first to adopt it STRATEGY in business, because brands like Shein have already implemented it before.

Does Temu really offer discounts up to 90%?

Thanks to the savings efficiency it offers to manufacturers and a group of 10,000 employees, Temu presents goods from 29 different categories with discounts between 30% and 90%.

Read Also:  Congress advances discussions on new 'Clean slate' project

In addition, it provides free shipping on most of your orders by partnering with well-known courier companies such as UPS, FedEx, and USPS.

In addition, ago supports the security of your transactions with certifications from entities such as Visa Secure, MasterCard ID Check and American Express Safekey, ensuring the integrity of purchases on its platform.

Can’t beat Temu by offering discounts up to 90%?

A business needs to make money to grow. Despite offering such a low price, PDD Holdings, parent of ago announced revenues of $7,209.8 million in the second quarter of 2023, representing a growth of 66% compared to last year.

The increase in revenue for PDD Holdings, also the owner of the large Chinese e-commerce platform Pinduoduo, came mainly from sales services and online transactions, with growth of 50% and 131% respectively one.

Nation World News Desk
Nation World News Desk
Nation World News is the fastest emerging news website covering all the latest news, world’s top stories, science news entertainment sports cricket’s latest discoveries, new technology gadgets, politics news, and more.
Latest news
Related news