How to combat the TEMU invasion: 6 Strategies for E-Commerce

May 21, 2024 | ,

Laura Bjerre Schwalbe

By Laura Bjerre Schwalbe


Reading Time: 5 minutes

It’s a name that’s impossible to ignore. 

No matter how hard you try.


The Chinese giant has invaded the e-commerce market and sent ripples through the industry with a strategy that most brands feel helpless against:

A marketing budget of an eye-watering 1.7 billion US dollars in 2023, used for buying top placements in Google and META across their massive product catalogue. At a fraction of the price of their competitors. With the slogan “Shop like a billionaire”, TEMU is certainly marketing spending like one.

As of right now, TEMU is the third most used online store in Denmark, and alongside other giants like Amazon, TEMU has contributed to a 10-15% price increase on Google Ads.


"At Danish Chamber of Commerce, we are pushing for political action to address the unfair competition that TEMU creates. Until that happens, my clear advice to e-commerce brands is: Keep on fighting, and leverage the advantages you've built up over your many years on the market."

Niels Ralund

E-commerce Director, Danish Chamber of Commerce

If your brand is like most, the paid media fight is one you can’t afford to win.

But that doesn’t mean that the battle is lost.

You can play to your strengths that, in turn, are TEMU’s major weaknesses: Loyalty, relevance, and locality.

Here are some key actions that you can take to tackle the TEMU invasion.

1. Set high standards for relevance and compliance

The first point is very simple: Be relevant and compliant.

As a new player in the Western market, TEMU is still learning the preferences of Western consumers. Recently, they have been receiving complaints that it's unclear why some products are recommended to users, which is also against EU law. 

Because of this, there's good reason to believe that TEMU will face restrictions to limit unethical marketing practices in the EU. 

Therefore: Be extra mindful and intentional about how you organize and use your first-party data.

By tracking past shopping behavior, browsing, and purchase patterns that the customer has given you consent to use, you can deliver personalized product recommendations that feel timely and relevant to each user.

And, importantly, you and your customer know exactly where the data is coming from. 

💡 Tip

Whether it's integrating a dedicated loyalty engine or using existing ERP or CDP systems, select the technology that aligns with your loyalty strategy and business goals.

2. Keep the visitor on your site – and optimize the conversion

Instead of focusing only on attracting more traffic, you should try to improve the experience on your website to get more conversions.

After all, the rising costs of digital advertising means that you need to maximize the value of every visitor you get.

This is where conversion rate optimization (CRO) comes in.


No matter if you know the visitor or not, every product page should be showing the most relevant recommendations to keep your visitor interested. And importantly, every add-to-basket should be followed with a relevant upsell.

Here, a pair of hiking boots is followed by a Raptor module showing hiking socks, a bucket hat, a water bottle, and other essentials for a hike.

💡 Tip

Up- and cross-selling can be completely AI-driven and automatized. Raptor’s recommendation modules always show the items that match both buyer intention and your business goals, so you no longer have to manually pick each suggestion. 

Did you know...? Raptor's recommendation modules also boost Time Spent On Site by 70%


3. Fast delivery private labels, and local strengths

Make the most of your local presence.

Maybe your brand has physical stores or warehouses closer to your customer base compared to TEMU, so use this to your advantage by highlighting your local strengths.

Highlight things like:

  • Next-day delivery, in-store pick-up, or easy returns
  • Products with a high stock
  • Trending products that have seen a rise in visits within the last 7 days
  • Well-known and trusted brands
  • Private label products with a high margin
💡 Tip

Build campaigns around well-known brands or your private label. Sometimes price is not the most important thing for the consumer, especially if a certain brand is known and trusted. With Raptor Merchandising, you can easily build time-limited campaigns that boost certain products in your recommendation modules. It's a great way to highlight chosen products without compromising on relevance. 


Here's an example of how you can display private label products in recommendation modules. Here, the private label is placed in front of other recommended products, ensuring higher conversions while still offering a relevant, personal recommendation. 



4. Build loyalty through meaningful benefits

Customer loyalty programs that offer real value can significantly enhance customer retention.

Design a loyalty program that rewards frequent shoppers with benefits such as exclusive discounts, early access to new products or special events, or free shipping.

But how about taking it a step further than just a loyalty program?

By segmenting your customer club by interests (or maybe their lifetime value), you can personalize their rewards or the messages you send to them. For example, if your member is a frequent shopper during sales seasons, you can give them early access to special sales or events.

💡 Tip

voucher-graphic2With Raptor’s Customer Data Platform, you can calculate if a high-value customer hasn’t made a purchase when they usually would. You can then target them with discount codes or a voucher to stop them before they leave for a competitor.


5. Engage your visitors with gamified campaigns

A great way to stay memorable is through gamified campaigns on your site. TEMU knows this, as games offering vouchers is a key part of their strategy.

But you can do it too!

clarins-exampleSee for example Clarin’s Mother’s Day campaign, where they implemented a catcher game by Qualifio. Visitors had to catch as many hearts as they could in 25 seconds for the chance to win product samplings and discount codes.

For Clarins, 1800 people took part in the campaign with 11% making a purchase after playing.

It’s not only a great way to get a visitor an extra step inside your door and towards conversion. It also collects vital zero- and first-party data about your customers, helping you create better andmore relevant customer experiences going forward.

💡 Tip

Try a couple of different gamification formats to figure out which game has the greatest effect. Your Gen Zs might be more interested in games while older generations might prefer quizzes or tests.


6. Don’t fall into TEMU’s Google trap

And what we mean by that is: Bring all your channels into play instead of relying on paid ads as a key strategy.

Many major e-commerce brands are focusing more on content pages than ever before. Not because they necessarily sell products or promote sales, but because they provide actual value and inspiration to your customers. You’ll stand out as knowledgeable and trustworthy – and you’ll be top-of-mind in the long run.

By creating a connection to your customers through e-mail, social media, your physical store, and maybe even your own app, you make it much less likely that your customer will leave you for a competitor.

The best solution for that is a Customer Data Platform (CDP) that is designed to connect all the data within your channels, tie your platforms together, and create aligned communication no matter where you meet your customer.

💡 Tip

Build look-a-like audiences that resemble the good customers within your business. By building these audiences based on your first-party data, you will reach and engage many more people than if you simply use the targeting features within META or Google (as much as +50% in Click Through Rates!)


Key Take-aways

TEMU is not the first drop-shipping dominator to enter the market – and it won’t be the last.

While they undeniably put pressure on the market, they also push existing e-commerce companies to innovate and improve.

Most importantly:

1. Use your first-party data. 

It’s a priceless leg-up on the competition that gives you endless opportunities to create relevant and personalized user journeys. And importantly, it's fully compliant and privacy-friendly. 

2. Conversion Rate Optimization (CRO) is key. 

Make every lead count by making the user experience as intuitive as possible – and don’t forget to increase basket size with relevant recommendations when you can. 

3. Play to your local strengths.

Fast delivery, easy returns, and exclusive brand deals are some of the perks that make you stand out. 

4. Build loyalty. 

Staying top of mind is all-important. Think about what perks you can offer that create an incentive to stay with you. 

5. Make it fun. 

TEMU uses plenty of games to capture the visitor and entice them with discounts. You can adopt a similar strategy with fun gamification strategies that both excite and convert. 

6. Activate every channel you own.

For this war, you need to get all your weapons ready. That means your e-mail newsletter, your social media accounts, your physical store, and everything in between. The more platforms you manage to activate your customers on, the more likely they are to stay loyal. 

Let us show you what you can achieve with premium personalization

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