GOLDEN VALLEY, Minn. — The story was originally published in November 2023.
In just days, the holiday shopping blitz begins with Black Friday. However, a shopping app called Temu has already tempted bargain shoppers for months now.
The online retailer sells just about anything you can think of, at prices up to 75% less than what you'd pay on other sites.
Since its debut just one year ago, Temu has become the most downloaded free app in both the Apple and Google Play stores. It has skyrocketed past every retail giant's apps, including Target, Walmart and even Amazon.
Why?
"You can hardly open your phone without seeing a Temu pop-up," University of Minnesota Carlson School of Management marketing professor George John said.
John said the astronomical rise of Temu could be attributed to the company's all-in approach on nonstop marketing.
"They've been on this incredibly aggressive campaign to download the app," John said. "The best guess I have is they spent 100s of millions, if not billions, on advertising. What they're betting on is, once you download the app, you get shopping/entertainment frame of mind and use it as a distraction."
So, in a time of historic inflation and supply chain issues where many retailers have turned to marking things up, how can Temu be selling all these items for so cheap?
John shed light on a few pieces of the puzzle.
"When you're shipping directly from China to the U.S., there are a couple of loopholes," John said. "If you ship something less than 800 bucks, you don't have customs duty to pay. I would be absolutely surprised to discover they're making money now. They don't expect to make money now, they're expecting over the long run, 30 million people in the U.S. to be 'shoppetainment' people."
Now, the big question: Are these products any good?
We ordered several products from Temu and Amazon that were similar, if not the same, to compare.
Many items did look similar at first glance, but ended up having quality and price differences. Temu items were generally significantly cheaper, but some items, like a flower vase meant to look like a book, came with a typo.
However, other items like pizza cutters were seemingly the same, except the Amazon pizza cutter came with a branded logo.
Temu advertises free shipping and free returns, just like Amazon does. However, on the Better Business Bureau's website, many of the complaints against Temu involve items that were significantly delayed or not having arrived at all.
Also upon closer inspection, we found both pizza cutter listings used the exact same photos. We reached out to Temu for a response about this, as it may raise copyright concerns.
The company's spokesperson agreed to chat but asked to remain unnamed and off-the-record. She did, however, send a written statement that reads in part:
"Temu has faced roughly 10 lawsuits stemming from (intellectual property rights) in the U.S… We've instituted rigorous measures and are proactive in addressing and combating all kinds of potential infringements."
WATCH: We ordered and tested several of Temu's cheapest items:
Cybersecurity concerns
None of the shipping minutiae may matter to a consumer looking to fill their time with online shopping. However, what matters is what the consumer might be giving up in exchange for the deals.
Temu has direct ties to China. It's owned by "PDD Holdings Inc.," headquartered in Shanghai. You don't have to look too hard to find reports that accuse the retailer of tracking everything from your location to your social media profiles.
A lot of other retailers do that as well, but reports show "PDD Holdings" takes it a step further by allegedly using malicious codes to bypass your phone's security settings, and sometimes changing them without your consent.
All of this, in order to track the user's every digital move — from the apps they're using to their personal text messages.
"Each and every category of data... like financial and usage data... is necessary to make the consumer shopping experience better," the company spokesperson told KARE 11.
They added the data they collect is "common industry practice."
Back in June, the House Committee on the Chinese Communist Party said its investigation into products offered to American consumers from Chinese retailers like Temu "could be made with forced labor in China," which is another aspect consumers might want to consider when shopping through Temu.
"Many of us don't think too much about it or we just don't know the truth," professor John said. "I would not use my regular credit card on any of these sketchy websites. I'd use a gift card. That way, you're protected in case something happens. In case there's a data breach and stuff like that, your core data is not compromised."
In the end, Temu did have some deals. However, some of them ended up being junk. While Temu's slogan is "Shop like a billionaire," consumers might want to do so — at their own risk.