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Shopping app Temu uses TikTok strategy to retain its #1 spot on the App Store • TechCrunch

Shopping app Temu uses TikTok strategy to retain its #1 spot on the App Store • TechCrunch

Shopping app Temu uses TikTok strategy to retain its #1 spot on the App Store • TechCrunch

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Temu, a shopping app from Chinese e-commerce giant Pinduoduo, is fast becoming the No. 1 app on US app stores. The mobile shopping app reached #1 on the US App Store in September and continued to hold a top position in the months that followed, including the #1 free app on Google Play since December 29, 2022. Most recently, Temu snagged the #1 position again on the iOS App Store on January 3 and hasn’t gone down since – even surpassing its competitor Shein’s daily installs in the US

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Offering cheap goods from factory to consumer, Temu provides access to a wide range of products, including fast fashion, and pushes users to share the app with friends in exchange for free goods, which may explain part of its growth. However, the vast majority of its new installs come from Temu’s marketing spend, it seems.

When TechCrunch covered the rise of Temu in November, the app had by then registered just over 5 million installs in the United States, according to data from app intelligence firm Sensor Tower, making United States its largest market. Now the company says the app saw 5 million installs in the US in January alone, up 19% from 4.2 million in the previous 22 days from Dec. 10 to Dec. 31. December.

According to Sensor Tower’s estimates, Temu managed to achieve a total of 19 million lifetime installs on the US App Store and Google Play, of which more than 18 million were from the United States.

The growth now sees Temu overtaking rival Shein in terms of daily installs. In October, Temu averaged about 43,000 daily installs in the United States, the company said, while Shein had about 62,000. In November, Temu’s average daily installs increased to 185,000 while Shein’s surged to 70,000 and last month Temu averaged 187,000 installs while Shein averaged around 62,000.

The rapid rise of the shopping app is a reminder of how video entertainment platform TikTok became the world’s most downloaded app in 2021, after years of outsized growth. The video app topped 2 billion lifetime downloads by 2020, including sister app Douyin in China, Sensor Tower said. Combined, TikTok apps have now reached 4.1 billion installs.

Like Temu, much of TikTok’s early growth was driven by marketing spend. The video app has grown its footprint in the US and overseas by leveraging heavily on Facebook, Instagram and Snapchat’s own advertising platforms to acquire its customers. TikTok reportedly spent $1 billion on ads in 2018, even becoming Snap’s biggest advertiser that year, for example.

By investing in user acquisition from the start, TikTok was able to gain an audience who then improved their ability to personalize their For You feed with recommendations. Over time, this algorithm became very good at recognizing which videos would generate the most interest from this investment, making TikTok one of the most addictive apps in terms of time spent. Starting in 2020, kids and teens started spending more time watching TikTok than YouTube. And earlier this month, data from Insider Intelligence indicated that all TikTok users in the US now average almost an hour a day on the app (55.8 minutes), up from just 47. .5 minutes on YouTube, including YouTube TV.

Although Temu is a far cry from TikTok’s sky-high numbers, it appears to be benefiting from a similar growth strategy. The company invests heavily in advertising to acquire users, which it uses to personalize the shopping experience. One of the main features of Temu, in fact, is its own type of For You page which encourages users to browse trending articles “Selected for you”. In addition to the gamification elements, Temu also emphasizes store and product recommendation on its homepage, which is informed by its user data.

But the app’s growth doesn’t seem to be driven by social media. While the hashtag Temu (#temu) on TikTok is approaching 250 million views, that’s not really a remarkable number for an app as big as TikTok where something like #dogs has 120.5. billion views. (Or, for a more direct comparison, #shein has 48.3 billion views.) This suggests that Temu’s rise isn’t necessarily fueled by viral videos among Gen Z users or by marketing. influence, but rather through more traditional digital advertising.

According to Meta’s Ad Library, for example, Temu served some 8,800 ads across Meta’s various platforms this month. The ads promote sales of Temu and its heavily discounted items, such as $5 necklaces, $4 shirts, and $13 shoes, among other deals. These ads appear to work to increase installs of Temu, allowing the app to retain its top spot in the App Store’s “Top Free” rankings, which are heavily influenced by download count and download speed, among others.

Of course, having a high number of downloads does not necessarily mean that Temu’s app will maintain a high number of monthly active users. Nor does it mean that these users won’t quit the app once their initial curiosity has appeased. Still, Temu’s growth in downloads has seen it rank first among “Breakout” shopping apps in terms of downloads in the US for 2022, according to the “State of Mobile” year-end report from data.ai. (Data.ai calculates “Breakout” apps in terms of year-over-year growth on iOS and Google Play.)

Since Temu’s growth is more recent, the app did not secure a position in the Top 10 Apps in 2022 in the US or the world in terms of downloads, consumer spending or users. monthly assets, in this report. Instead, most of those spots still went to social media apps, streamers, and dating apps like Bumble and Tinder. The only retailer to find a spot on these lists was Amazon, which was the #7 app globally by active users and #8 most downloaded in the US.

Temu’s marketing investment may not be as profitable as TikTok’s as other discount shopping apps have seen similar growth only to later fail as consumers have discovered that in fact , $2 shirts and jeans were too good to be true deals. Wish fumbled as consumers grew increasingly frustrated with long shipping times, fake listings, missing orders, poor customer service and other things consumers expect from online retail. era of Amazon.

Temu now holds a 4.7-star rating on the US App Store, but those ratings have become less reliable over the years due to how easily companies can get away with fake reviews. Dig deeper into the reviews and you’ll find similar complaints to Wish, including fraudulent listings, damaged and delayed deliveries, incorrect orders, and a lack of customer service. Without addressing these issues, Temu seems more likely to go the way of Wish, not TikTok, no matter what he spends.

Tech

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