Faced with fierce competition from Shein and Temu, Amazon is preparing a response and is also seeking to market cheaper products shipped directly to customers from China.
With an ultra-aggressive marketing policy and unbeatable prices, the Chinese giants Shein and Temu have firmly established themselves in the e-commerce sector, particularly in fast fashion. But their rise to power, particularly in the United States, is not viewed favorably by Amazon. Thus, Jeff Bezos’ company recently organized a private conference in China in order to attract the country’s producers, as reported CNBC And The Information. It plans to open by next fall a discount section dedicated to the sale of unbranded products at rock-bottom prices, which would be sent to buyers directly by sellers based in China. It is nothing more and nothing less than stepping on the toes of its competitors, even if it means copying their disastrous carbon footprint and promoting unbridled consumerism.
Shein, Temu and company: a proven economic model
Thus, Amazon will copy the economic model of Shein, Temu and other Chinese platforms, which offer low-priced items and ephemeral collections, whether clothing, electronic devices or household items. . To achieve such a result, they resort to small-quantity production that adapts to demand and shipping directly from China – which can take several weeks.
Amazon will therefore do the same, by offering a range of unbranded products – according to CNBC, dumbbells, phone cases and even face masks were presented –, a good part of which should cost less than 20 dollars. To reduce costs, the product ordered on Amazon would be sent directly by the manufacturer from China, using the dropshipping method, within nine to eleven days.
Amazon: towards even more unbridled consumerism?
Amazon is not new to China. Low-cost Chinese products are already widely present on the e-commerce platform – their volume sales have also increased by 20% between 2022 and 2023. However, until now, Amazon has encouraged sellers to use its service “Fulfilled by Amazon,” which involves sending products to the company’s warehouses, which then ships the products in record time, in exchange for fees charged to the original sellers. This new method would allow manufacturers and sellers to save money, and therefore offer products at more competitive prices. Obviously, Jeff Bezos’ company would charge a commission on sales made on its platform.
This new strategy may seem advantageous for consumers, who will benefit from attractive Chinese prices and the advantages of Jeff Bezos’ platform, but it does not fail to raise serious concerns. Indeed, Shein and Temu attract strong criticism not only on a competitive level, but also because of their incitement to overconsumption. Both platforms push consumers to buy low-cost products that they don’t necessarily need, which are often of poor quality and therefore need to be replaced regularly. Suffice it to say that the ecological impact is catastrophic… And that’s without taking into account the deplorable working conditions of the employees – the Uyghur people are unfortunately paying the price! In addition, the two Chinese companies do not hesitate to market counterfeits, dangerous or harmful to health items, ignoring the various regulations (see our article). Practices which have placed them in the sights of the European authorities, determined to make them respect the DSA.